Resources Top 5: Novo and SQM team up for lithium ‘n’ nickel; MTM bursts up 120pc
Here are some of the biggest resources winners in early trade, Tuesday December 19.
Move over a bit Azure and Gina, because the third in their ménage à trois – SQM – also has a thing going on with Novo Resources.
As Stockhead’s Top 10 at 10 covered, just a bit beyond 10am this morning, Pilbara gold explorer Novo is the latest to ink a JV with global lithium miner SQM, which will shell out A$10 million for a 75% interest in five of Novo’s prospective lithium – nickel tenements.
This ground is “adjacent to or in the vicinity” of the Andover project owned by Azure Minerals’ (ASX:AZS), which is the subject of a new joint ~$3.70/sh takeover bid by SQM and Hancock Prospecting.
[NEWS] Novo Resources and Global Lithium Producer SQM Form Strategic Joint Venture
Battery Metals Portfolio Update: https://t.co/4MeR4hL0Nx
— Novo Resources Corp. (@Novo_resources) December 18, 2023
It’s a handy cash injection and promises there’ll be a bit more activity and weight behind the lithium hunt on the gold explorer’s ground.
NVO’s share price has shot up some 45% as a result, swiftly reversing what was beginning to look like a pretty bloody ordinary December for the sub-$10m market capper, which is now up roughly 10% YTD.
The lithium – nickel collaboration between SQM and Novo is dubbed the Harding Battery Metals Joint Venture, comprising those aforementioned five sites, with an option over additional Novo Pilbara tenements.
Novo will be entitled to a “contingent success payment” based on the lithium contained in a JORC compliant ore reserve upon completion of a feasibility study.
A couple of other key details in the JV battery metals hunt: SQM will be the manager; and Novo will retain 100% of the gold, silver, PGE, copper, lead and zinc mineral rights.
Novo executive co-chairman and acting CEO Mike Spreadborough said:
“To be participating in a JV with a global lithium leader like SQM is an excellent outcome for Novo and will see us receive an immediate payment of A$10 million that will further boost cash reserves for our primary gold exploration focus.
“Meanwhile, SQM can focus on the battery metals prospectivity of the West Pilbara area and our shareholders can benefit from future exploration success with a free-carried interest until a decision to mine.”
NVO share price
This tiny copper stock is also near the top of the ressie gainers at the time of writing with a +50% bolt out of the blue. Actually, out of the red as it’s been trending down this year – YTD -54%.
Culpeo owns a big exploration package in Chile, the world’s number one copper producer, with two high priority project areas (Lana Corina and Fortuna) on the Chilean coastal belt.
Its news today regards the El Quillay North prospect at the Fortuna project, where it’s sighted significant widths of visible copper mineralisation, intersected at a “very” shallow depth.
• A broad zone of shallow visible copper mineralisation intersected over 40m from 15m downhole in CMEQD002 and over 23m from 20m downhole in CMEQD001.
• The mineralisation in both those two diamond-drilled holes remains open in all directions.
This, says the company, expands the potential of the El Quillay corridor where outcropping copper mineralisation and historical mining is present over a strike length of more than 3km.
Assay results are expected in January.
Here’s a sample:
Culpeo Minerals’ MD, Max Tuesley seems suitably excited:
“It is a fantastic result to immediately intersect visible copper so near to surface with our first two diamond holes at El Quillay North. This validates our initial work and confirms the prospectivity of this very exciting target.”
As our Jess Cummins wrote in November, what makes the Fortuna project interesting:
“Is the presence of numerous historic shafts and small-scale mining sites that hold historical significance, yet have not undergone exploration using modern, state-of-the-art techniques”.
That under-exploration appears set to change.
CPO share price
Ever since emerging WA lithium producer Global Lithium (ASX:GLI) acquired a 10.5% stake in Kairos via ~$4m placement back in June, KAI has been snaking down to a share price position that sees it roughly -14% YTD.
That said, it’s shot up near 30% over the past 24 hours at the time of writing, and it has some news.
Based on assay results, it’s made a high-grade rare earths discovery at the Roe Hills project in the Eastern Goldfields region of WA, not far from Kalgoorlie.
It’s talking thick zones of high-grade, clay-hosted rare earth elements (REE) with assays up to 2.31% TREO – over a large area at the project’s Black Cat prospect.
The results include a standout intersection of 28m at 3854ppm TREO from 32m which includes 4m at 2.31% TREO (23,182ppm) in drillhole RHRC253.
Additionally, more than 90% of holes tested for REEs have returned significant intersections of REE (>500ppm TREO).
The company notes the mineralisation contains “exceptionally high proportions of the high-value neodymium + praseodymium (23% of TREO) and Magnet REO (28% of TREO) elements”.
Kairos believes Black Cat to be a significant clay-hosted REE discovery with scale and potential.
Is that all, then? Actually, here’s something else to keep an eye on:
Additional lithium-bearing pegmatites with highly promising LCT-fertility indicators have reportedly been intersected in an existing pegmatite swarm at the Crystal Palace prospect to the north of Black Cat (see above).
KAI share price
Battery metals have had a battered about old year, many of them. SGA, for instance, is down about 38% YTD.
It has good news today, though, especially for fans of things that are round.
The company has announced it’s produced its first spheroidized graphite from the Sarytogan graphite deposit in Central Kazakhstan.
Why’s the “spheroidized” aspect important? It’s a part of the necessary production process that readies the commodity for actual sale to battery cell makers.
It’s actually reminded me to re-read this explainer from a while back, written by resident ressie-spert Reubs, which included the following:
There is 10 times more graphite than lithium in a lithium-ion battery, with each EV requiring ~55kg of flake graphite to make the battery anode.
The process from the mine to battery is a complex one.
First, graphite ore is processed into a flake concentrate, which is then shaped in a process called ‘spheronisation’.
Then it has to be purified to 99.95 per cent.
At that point we have a potato shaped particle, sized to a certain diameter, which is +99.95 per cent graphitic carbon.
Here’s what that looks like:
Just joking, they’re tiny.
Then these particles must be coated. Once coated, spherical purified graphite is called ‘active anode material’.
Now it is ready for sale to a cell maker.
Here are some of the highlights from SGA’s process:
• “A high combined spheroidization yield of 54% has achieved ideal D50 sphere sizes of 32, 18, and 12 μm after classification with high tap densities ranging from 0.91 to 0.99 g/cm3.
• “All flowsheet elements now demonstrated for production of Uncoated Spherical Purified Graphite (USPG) and Ultra-High Purity Fines (UHPF).”
• “Both the USPG andUHPF products to now be tested in advanced battery applications.”
• A PFS (pre feasibility study) is advancing and is scheduled for completion no later than Q3 2024.
SGA share price
Hang on, hold the phone… Just as we were about to put this article to bed, MTM goes and pulls a +100% gain.
Why? The tiny goldie has announced it’s acquiring a West Arunta niobium-REE project that’s prospective for mineralised carbonatites and is adjacent to WA1 Resources (ASX:WA1) and Encounter Resources (ASX:ENR)
MTM is picking up 100% of Flash Metals Pty Ltd, the owner of three granted exploration licences in Western Australia’s West Arunta, immediately adjacent to ground held by WA1 and ENR.
The deal also includes the acquisition of the Mukinbudin niobium-REE Project, which comprises two granted exploration licences 250km northeast of Perth in the South West Mineral Field.
The company also notes that Flash holds an option to exclusively negotiate the rights to Flash Joule Heating technology developed by Rice University in Houston, USA.
Why’s that important? It’s because the tech has reportedly shown potential to treat REE mineralisation and more efficiently recover critical metals from critical metal-rich recycling and waste streams.
MTM share price