Resources Top 5: This mysterious explorer has been sitting on a mothballed 5.3Mt copper, 19.3Moz gold deposit since 1989

Enigmatic Bougainville Copper up ~30% on no news
African bauxite project developer CAY scores ~$12.1m via placement at a massive 41.8% premium
Pivotal Metals finalises acquisition of Horden Lake, a big 27.8Mt at 1.49% copper equivalent resource in Quebec, Canada

Here are the biggest small cap resources winners in early trade, Wednesday December 21.

BOUGAINVILLE COPPER (ASX:BOC)

(Up on no news)

BOC puts out the same sad announcement every quarter.

But things could be moving in the right direction.

The Bougainville Government “is very keen” to see a resumption of mining at BOC’s monstrous Panguna copper-gold deposit “as it strives to develop its economy in its quest to achieve independence by 2027”, according to this news source.

Here’s the project’s background, which is interesting.

Gold and copper were discovered in Bougainville’s central hinterland in the 1960s by prominent exploration geologist Ken Phillips. It was subsequently developed by BOC, then a subsidiary of Rio Tinto (ASX:RIO).

‘Panguna’ was established in 1972 as the world’s largest open cut mine. In the 16 years to 1988, Rio extracted a total of 3 million tonnes of copper, along with associated silver and gold.

Production stopped in 1989 after conflict between the Bougainville Revolutionary Army and Papua New Guinea Defence Force escalated into a decade-long civil war.

It is still one of the world’s richest deposits. Today, Panguna still holds an estimated 5.3 million tonnes of copper and 19.3 million ounces of gold – a veritable treasure trove.

CANYON RESOURCES (ASX:CAY)

African bauxite project developer CAY has scored ~$12.1m via placement at a massive 41.8% premium to the 30-day volume weighted average price (VWAP).

The cash comes from Singapore-based Eagle Eye Asset Holdings, which “has a successful track record in investment and developing projects in Africa amongst other geographies”, CAY says.

Eagle Eye will own 19.9% of the company on completion of the placement, becoming its largest shareholder.

CAY’s focus is the 1 billion tonne ‘Minim Martap’ bauxite project in Cameroon, which is at the pointy end of the development cycle.

Bauxite is the only raw material used in the commercial production of alumina, which can then be turned into aluminium metal.

One tonne of aluminium requires about five tonnes of dried bauxite.

A project BFS confirmed Minim Martap as a “robust” long-term project, “producing some of the highest-grade bauxite globally for an initial 20 years of mining”, CAY says.

In October, the company said it had seen increasingly strong interest from potential joint venture and strategic partners since the release of the BFS.

“During the quarter, conversations have continued with multiple potential partners who are interested in the Minim Martap Bauxite Project with a view to securing long term supply,” it says.

“The company expects to commence a formal process of negotiations with potential partners, including offtake and strategic funding or equity partners in the near term.”

MAYUR RESOURCES (ASX:MRL)

(Up on no news)

Diversified PNG-based MRL is another stock close to development and first cashflows.

Its ‘Central Cement and Lime’ project would be a vertically integrated manufacturing facility with the ability to meet 100% of PNG’s cement, clinker and quicklime requirement.

The co-located quarry, plant site and deep draft wharf will enable very low operating costs, it says.

Phase 1 of the project is fully permitted and construction ready, the company says, with first revenue from aggregates and quicklime pencilled in for the second half of 2023 and 2024, respectively.

MRL is now looking to bed down financing.

It is also building the Orokolo Bay vanadium, iron, and industrial sands project, where a mining lease was recently granted.

This was followed by the signing of a magnetite offtake agreement with a large Japanese trading house and a cornerstone investment deal.

The spin-out and IPO of Ortus Resources on the ASX to raise capital for Orokolo Bay remains on hold due to prevailing market conditions, the company said last quarter.

Discussions and due diligence with potential strategic partners to fund the project privately continues, with MRL pencilling in first revenues for Q4 next year.

PIVOTAL METALS (ASX:PVT)

The stock formerly known as Rafaella Resources has just finalised the acquisition of Horden Lake, a big 27.8Mt at 1.49% copper equivalent resource in Quebec, Canada.

That resource – collated from a bunch of old drilling results – includes 200,855t copper, 61,726t nickel, 167,114t palladium and 65,000oz gold.

It is now a focus for the company, formerly a tin-tungsten project developer based in Spain.

Drilling is planned grow and upgrade the Horden Lake resources, focusing on higher-grade copper ore-shoots and on those areas only drilled by INCO in the 1960s, where assay data is only available only for copper and nickel.

A 2023 PFS will also look to finally include the entirety of the contained gold as well as adding the cobalt and silver, PVT managing director Steve Turner says.

“We are finishing the year having completely transformed the portfolio,” Turner says.

“The strategic refocus and upgrade to the portfolio offers tremendous potential to shareholders with considerable news flow expected over the coming year.

“The drilling programme for Horden Lake has been prepared and the permitting submitted to ensure that operations can commence early in the New Year.”

PEARL GULL IRON (ASX:PLG)

Beleaguered iron ore explorer PLG – which listed last September at 20c per share — is raising $2m at 2c per share to keep the lights on.

“Since we listed, we have concentrated on delivering the exploration plan on Cockatoo Island that was presented in the IPO prospectus,” chairman Russell Clark says.

“We have reached a point where additional funds are required to continue the exploration work, assess new opportunities and for working capital.

“We are very pleased that this raise is fully underwritten providing confidence to new and existing shareholders.”

There is a maiden resource due out soon on the flagship Cockatoo Island ‘Switch Pit’, where the company has been drilling into thick, high grade iron ore like ~57m grading 68.9% fe from ~80m.

That’s high. The benchmark grade often quoted is 62% fe – anything higher than this can attract a substantial price premium from buyers.

Aside from rare exceptions like Mount Gibson Iron’s (ASX:MGX) Koolan Island mine – right next door to Cockatoo — Australia doesn’t have many high grade hematite resources like those in Brazil or Africa.