Gold Investment Day Keynote Drops into The Roadhouse Enroute to Singapore

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COMMODITY CAPERS: For those who may not have been paying as close attention as they should have been the gold price recently tipped over the US$3000 per ounce barrier.

There are plenty of reasons being bandied about for this event with many analysts pointing the finger at one person in particular who they say has given the world order too much of a shake in the past few months.

This will be one of the points of discussion to be dissected at the Singapore Mining Club Gold Investment Day – the opener to the Resource Connect Asia Tribeca Future Facing Commodities Conference in Singapore next week.

In the lead up to the conference, The Resources Roadhouse caught up with Keynote Speaker Ron F. Hochstein president CEO and director of Vancouver based Lundin Gold.

Lundin Gold operates the 100 per cent-owned Fruta del Norte gold mine, located in southeast Ecuador which has been in production since late 2019, and is among the highest-grade operating gold mines in the world.

Resources Roadhouse: It would be no surprise to hear that you are bullish on gold at present. How far do you think the gold price can go?

Ron F. Hochstein: Yes, it’s accurate to say that we are indeed bullish on the prospects for gold. While predicting the exact peak of any commodity price is inherently challenging, and we don’t have a specific target for how high the gold price can ultimately go, we believe the current macroeconomic environment presents a compelling case for continued strength.

From Lundin Gold’s perspective, our focus remains on operational excellence and maintaining our position as a low-cost producer. With production guided at 475,000 to 525,000 ounces per year for the period of 2025 to 2027, and an all-in sustaining cost consistently under $1,000 per ounce of gold, we are exceptionally well-positioned to benefit from any upward movement in the gold price.

To illustrate the potential, at a gold price of $3,000 per ounce, our operations would be capturing a significant margin. This substantial difference between our production cost and the market price would translate directly into significant free cash flow generation for the company.

While we refrain from speculating on precise price targets, our low-cost base and consistent production provide a strong foundation for significant profitability in a rising gold price environment.

RR: What do you believe is driving the current gold price?

RFH: We believe several interconnected factors are currently contributing to the strength in the gold price.

Firstly, heightened geopolitical and economic uncertainty is playing a significant role. In the current global landscape, marked by ongoing regional conflicts, trade tensions, and general economic anxieties, gold is once again being sought after as a traditional safe-haven asset. Investors tend to gravitate towards gold during times of instability to preserve capital.

Secondly, inflationary pressures, concerns about currency devaluation, and increased money supply remain relevant. While inflation rates may have cooled somewhat in some regions, the cumulative effect of past inflation, the potential for future price increases, and the expansion of the money supply continue to make gold an attractive hedge against the erosion of purchasing power of fiat currencies.

Thirdly, central bank buying is a crucial element. We’ve observed a trend of central banks increasing their gold reserves. This accumulation can provide significant support to gold prices.

Finally, investment demand is picking up, with both institutional and retail investors starting to buy again. The increasing accessibility of gold through various investment vehicles like ETFs has broadened investor participation.
It’s likely a combination of these factors, rather than a single driver, that is underpinning the current gold price environment.

RR: Are investors still focused on bullion, or are they looking at gold mining/exploration company investment opportunities?

RFH: We believe there’s currently interest in both physical bullion and gold mining/exploration company investment opportunities. While bullion remains a core safe-haven asset, we are seeing a notable shift with generalist investors starting to look at the gold mining industry to get exposure to the gold price again after a prolonged period of underinvestment.

This renewed interest in gold equities is driven by the characteristics of this cycle, with generalists particularly focused on free cash flow yield and dividend yield. Low-cost gold miners are of significant interest as they are best positioned to generate substantial free cash flow in the current environment.

This strong cash flow potential supports attractive dividend yields, making well-positioned, low-cost producers like Lundin Gold increasingly appealing to a broader investment audience beyond traditional precious metals investors.

RR: Lundin Gold’s Fruta del Norte gold mine in southeast Ecuador continues to lay eggs at a rate that would exhaust any golden goose. What expansion plans do you currently have underway at the mine to keep production on track?

RFH: We are incredibly pleased with the consistent performance of our Fruta del Norte mine, and we are actively pursuing strategies to ensure its continued success and longevity.

Currently, our plant expansion project is being commissioned, which is a key initiative to maintain and potentially grow our production profile. This expansion will initially increase mill throughput to 5,000 tonnes per day (tpd) for the year 2025, and we anticipate a further increase to 5,500 tpd from 2026 onwards. This increased processing capacity will be instrumental in sustaining our strong production rates.

Beyond the plant expansion, we are also very encouraged by the results of our near-mine exploration program. We are having great success through the exploration drill bit, actively defining several promising targets including FDNS, FDN East, Bonza Sur, and Trancaloma. These exploration areas hold significant potential to provide incremental production in the future and contribute to extending the overall mine life of Fruta del Norte.

Our strategy involves a two-pronged approach: optimizing our existing operations and aggressively pursuing near-mine exploration to unlock further value and ensure a sustainable production profile for years to come.

 

 

Will 2025 IPOs Limbo Beneath Record Low Set in 2024?

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COMMODITY CAPERS: HLB Mann Judd has been completing its annual IPO Watch for 20 years, in which time it has not seen such a dire result as that presented by 2024.

The advisory and accounting firm found that 2024 recorded just 29 new ASX listings, fewer tha 2023 which produced just 32 IPOs, a result market watchers considered then to be disappointing.

“The poor listing volumes are reflective of another challenging year in which there have been significant macro and political factors globally, and upcoming policy uncertainties in relation to the incoming US administration from the end of January,” HLB Mann Judd partner corporate & audit services Marcus Ohm said in the report.

Ironically the record low number of 2024 listings produced a higher total raising of funds, a 387 per cent increase to be precise of $4.1 billion, a decent jump on that delivered in 2023 of $847 million.

This was attributed to the eleven large cap listings in the year. HLB Mann Judd puts companies with a market capitalisation above $100 million in the large cap grouping. The eleven bigger cap companies contributed 96 per cent of the total funds raised.

There was only one large cap listing in the Materials sector in the year being Metals Acquisition Limited (ASX: MAC) which listed in February raising $325 million.

Elsewhere across the sector the ASX welcome another 12 entrants. The total of thirteen representing the highest number of listings in the year. Irony bit again, however, with new Materials listings representing only 45 per cent of total listings, down from 72 per cent in 2023 as conditions for battery metals listings proved difficult.

It should be of no surprise that the Materials sector has historically recorded the most new listings, a rosette the sector maintained to display proudly in 2024.

There are, however many headwinds for the sector to battle, none more so than the lack of funds that seem to be available from the investment community.

More companies on the boards means more competition for that all important investment dollar and these days, as opposed to the mad times when those with the keys to the safe would throw money at anything, punters are far mor circumspect when it comes to taking the plunge, which is usually from the lowest springboard as opposed to the 10 metre tower.

Ohm was more prudent when presenting his thoughts on the matter, saying “This reflects unsupportive market conditions for junior exploration listings resulting in a marked decrease in the number of successful Materials listings.”

Gazing into his crystal ball, Ohm indicated there to be only three upcoming listings raising new capital on ASX as at 4 January 2025, which he suggested was a fair indication there won’t be an immediate uptick in IPO activity in the first quarter of the 2025.

“Conditions remain challenging in the IPO market at present and any marked improvement is likely be in the second half of 2025,” he said.

“The effects of a change in presidency in the US also present a potential impact on both the Australian and global markets in 2025.”

 

 

Uranium Set to Have its Day

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COMMODITY CAPERS: Uranium remains the under-appreciated Australian commodity despite the global membership badges our domestic industry displays.

Australia is ranked number one in the world for uranium resources, a lot of which still sits unmined.

Be that as it may, we are able to boast being ranked as the fourth largest uranium producer globally with the value of our uranium exports for the year 2023-204 hitting an impressive $1,200 million.

Australia’s uranium exports are currently produced at the Four Mile, Olympic Dam and the newly-opened Honeymoon mines in South Australia.

When the Honeymoon mine kicks in it is anticipated to push up Australia’s uranium export earnings to about $1.3 billion in 2024–25, with exports predicted to hit $1.5 billion in 2025-26.

Exploration for uranium has run rampant this year with uranium miners forking out some $15.2 million on exploration in the June quarter 2024, a healthy rise on the $3.4 million spent in the March quarter 2021.

In a recent research note on Paladin Energy (ASX: PDN) broking house ShawandPartners declared its bullish outlook for the uranium market.

“There is not enough supply to meet current demand, let alone increased demand from reactor restarts, new reactor builds and demand from Small Modular Reactors (e.g. Amazon, Google),” it said.

“The long-term contract price is continuing to shift higher each month (currently US$82/lb) and we think it is likely that contracting prices head above US$100/lb.”

Paladin Energy restarted its Langer Heinrich mine in Namibia this year after six years in care and maintenance.

Langer Heinrich is forecast to produce approximately 6Mlb of uranium when in production which is around three per cent of global supply.

“The two main issues impacting Langer Heinrich are the grade of the material on the previously mined stockpiles, and the availability of water from NamWater,” ShawandPartners said.

“Neither of these issues will be a problem post the processing of the stockpiles once production shifts to processing of freshly mined ore.

“Paladin has commented that it expects to reach full production rates of 6Mlb/yr by the end of 2025 as previously expected.”

ShawandPartners highlighted the recent run enjoyed by the spot uranium price through US$100/lb on the back of strong global support for nuclear energy to decarbonise power grids.

This has been heightened by supply constraints being felt by major producers such as Kazatomprom and Cameco.

“In our view the uranium price is likely to continue moving higher with US and European utilities not covered for the fuel requirements from 2026-2028 and limited new supply in that timeframe,” ShawandPartners said.

“It is difficult to see what will cap the upside in the short term.

“We assume a multi-year price spike to US$150/lb, before settling to our long-term U3O8 realised price assumption of US$76/lb (2024 Real) in 2030.”

Uranium will be the main agenda point at the RIU Uranium Investment Day being held at Claremont Football Club next Tuesday 19 November.

 

For information on the day CLICK HERE

Gloves on For Potential Potash Pugilism

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COMMODITY CAPERS: There appears to be a stoush brewing over prospective potash tenements in Western Australia.

In July this year, in a release dated 24th of that month, Reward Minerals (ASX: RWD) advised the market it would be concentrating its efforts and funding toward the advancement of the company’s Carnarvon Potash Project (CPP) and its patent pending processing technology.

Now concentrating its focus at Carnarvon, Reward indicated it felt the need to surrender its Kumpupintil (KP) potash project tenements, also in WA, which it did on July 22.

The company maintained Miscellaneous Licence (L45/302) that contains the KP Project camp and infrastructure, which it intends using to attend to minor environmental remediation of work areas including feasibility study test ponds, trenches and site access tracks.

This week, Jamukurnu-Yapalikurnu Aboriginal Corporation (Grandfathers country-Grandmothers country) the trustee for Martu exclusive native title lands, covering approximately 150,000 square kilometres of the Western Desert in Western Australia released a statement claiming the surrender of said tenements should have been discussed with them first, but wasn’t.

In the statement the land council representing the Martu native title area announced the termination of an agreement with potash mining companies, Holocene and Reward Minerals, following what it declared “a serious breach”.

The statement cited the Kumpupintil Indigenous Land Use Agreement (ILUA) between Jamukurnu-Yapalikurnu Aboriginal Corporation (JYAC), Holocene Pty Ltd (Holocene) and Reward Minerals Ltd that was related to the Kumpupintil potash project (formerly known as the Lake Disappointment potash project).

The land council explained the ILUA contains a key clause requiring JYAC be given 60 days’ prior written notice of the company’s intention to voluntarily surrender or relinquish its project titles, giving JYAC the option to acquire mining tenements over the location on behalf of Martu.

The project titles were surrendered on 22 July 2024 without informing the land council as required.

This is where it all gets interesting. Not much time elapsed, in fact just 38 minutes after the titles were surrendered, when another company, SBR critical minerals, swooped in and lodged applications for a series of mining tenements in that same location, depriving the land council of the opportunity to consider applying for them on behalf of Martu traditional owners.

Understandably the land council was not altogether pleased with this chain of events.

“In response to this serious breach, we have written to Reward and Holocene to inform them that the Kumpupintil ILUA has been terminated, effective immediately,” JYAC interim chief executive officer Rewi Lyall said in the statement.

“Martu have exclusive possession native title rights over their ngurra.

“Companies who come here know that when they make agreements to use Martu land, JYAC takes those agreements seriously.

“The companies agreed to give Martu the first opportunity to take ownership of its project titles or peg mining tenements over the location, but their actions allowed another company to take the area instead.

“JYAC will now consider the extent of this loss to Martu, and pursue compensation through the courts if necessary.”

The Roadhouse contacted Reward Minerals and the Department of Energy, Mines, Industry Regulation and Safety (DEMIRS) for comment, but had not heard back from either before deadline. We hope to bring you more about this next week.

New World Metals on Show at Investment Series

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THE CONFERENCE CALLER: As always, the annual New World Metals Investment Series is hosting a strong program of presenting companies.

This year, however, The Roadhouse has opted to look at the commodities being showcased by the presenters.

 

Antimony

The United States is currently on the look out for deliveries of many critical metals that were previously supplied by China and Russia, of which antimony is one.

China has imposed export restrictions on antimony to the extent that the reaction has been a very strong increase in the global price.

Antimony is used in a wide range of applications, ranging from flame retardants by enhancing the fire resistance in fabrics, plastics, and building materials.

Antimony plays an important role in the electronics industry for making diodes, Hall-effect sensors, and infrared detectors.

Antimony oxide improves the clarity and quality of glass and ceramics.

 

Copper

Copper exploration has been an ongoing constant in the Australian mining landscape and continues to be so.

Recent expenditure on copper exploration shows Australian exploration plays still enjoy the thrill of looking for, and the added thrill of finding this soft, malleable, and ductile metal with very high thermal and electrical conductivity.

According to the boffins at the Department of Industry, Science and Resources in their Commonwealth of Australia Resources and Energy Quarterly March 2024 the average spend on copper exploration in Australia rose to $169 million in 2023.

“This was around 19 per cent higher compared to the last year, and continues a general upward trend seen since 2017,” DISR said.

“Export volumes are forecast to reach 845,000 tonnes in 2023–24, little changed from 2022–23.

“However, due to a lower copper price, export earnings for 2023–24 are forecast to be around $12.1 billion, a 1.2 per cent contraction compared to 2022–23.

“Exports earnings (in real terms) are projected to grow 4.7 per cent annually, to reach around $16.8 billion by 2028–29.”

 

Gallium

Gallium is a critical metal used in the defence industry and computer chips with gallium chips anticipated to potentially replace silicon in semi-conductors, transistors, including electronic circuitry.

Gallium increases component speed and miniaturisation critical in generative AI and associated demands for semiconductors.

Once again, China has been central to the element’s recent surge in interest due mainly to an export ban implemented by that country in 2023.

Up to then, China was pretty much the sole gallium supplier to the semiconductor industry, producing around 98 per cent of the world’s supply of raw gallium.

Critical metal watchers anticipate USA, European and Asian, Sovereign states and semiconductor chip makers will be active in seeking reliable and secure supplies outside of China.

 

Graphene

Graphene was discovered in 2004 by some University of Manchester scientists playing with their graphite pencils and some sticky tape.

Their curiosity produced a substance 200 times stronger than steel that is 1,000 times lighter than paper.

Graphene conducts electricity better than any other material at room temperature making it a high contender for use in the battery industry.

Its exceptional conductivity has potential to produce graphene-based batteries that charge faster and last longer than the current lithium-ion favourites.

 

Graphite

Graphite is a soft, black mineral composed of carbon in a hexagonal crystalline structure, making it an ideal source for producing graphene.

Graphite is found in three different forms: in high-grade metamorphic rocks as disseminated crystal flakes; in veins or fractures as vein graphite; and in thermally metamorphosed coal deposits as amorphous graphite.

Graphite is a good electrical conductor and has a high fusion point and good lubricating properties.

It is used as an anode in batteries, as a refractory material in industries producing molten metal for crucibles and blast furnace linings, and to replace asbestos in brake shoes for heavier vehicles. Graphite is also used in pencils.

 

High Purity Alumina

High purity alumina (HPA) is a pure, high-grade form of non-metallurgical alumina or aluminium oxide (Al2O3).

Uses for HPA varies depending on its degree of purity, which can vary from 99.99 per cent (4N) and 99.999 per cent (5N), with some companies now seeking to produce 99.9999 per cent (6N) purity.

HPA is an essential compound for the manufacturing of LED (light-emitting diode) lights, lithium-ion batteries for electric vehicles and synthetic sapphire glass for wearable tech and smartphone camera lenses.

 

Indium

Most indium is used to make indium tin oxide (ITO), an integral ingredient of touch screens, flatscreen TVs and solar panels. This is because it conducts electricity, bonds strongly to glass and is transparent.

Indium nitride, phosphide and antimonide are semiconductors used in transistors and microchips.

Indium metal sticks to glass and can be used to give a mirror finish to windows of tall buildings, and as a protective film on welders’ goggles.

It has also been used to coat ball bearings in Formula 1 racing cars because of its low friction.

 

Lithium

If you haven’t heard of lithium by now, turn your phone on.

Lithium, a soft, very light, white metal, is found in spodumene rock formations, and Australia has some of the best-known deposits in the world.

Aside from its technological uses, lithium also has medicinal properties for psychotic medications.

 

Mineral Sands

Mineral sands (sometimes known as heavy mineral sands) contain concentrations of industrial minerals, such as rutile, ilmenite and zircon.

Other elements are sometimes present in the form of monazite and xenotime.

Rutile and leucoxene are sometimes blended to produce a high-grade titanium to be used as a feedstock to produce titanium dioxide and to make titanium metals for the aerospace industry.

Zircon is used as an opacifier for glazes on ceramic tiles, in refractories and for the foundry industry.

 

Nickel

Nickel has been delivering a world of pain to Australian participants with global mined nickel production up by 6.9 per cent year-on-year in the March quarter 2024.

Sounds good initially, until Indonesia is factored into the equation, which takes credit for the vast majority of that growth.

Because of its ability to process nickel further than Australian producers, Indonesia has more chance of exporting to China and is on track to further add to its current output.

The recent fall in nickel prices is expected to result in a substantial drop in Australia’s total mined and refined nickel production through to 2025–26.

We have already seen mine closures and reduced output from several Australian producers, as well as delays in planned projects.

 

Rare Earths

Rare earth elements are a group of seventeen chemical elements that occur together in the periodic table that is made up of yttrium and the 15 lanthanide elements (lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, and lutetium).

Rare earth metals and alloys that contain them are used in many everyday use devices, such as computers, rechargeable batteries, mobile phones and magnets.

Many of the rechargeable batteries made with rare earth compounds are also used in electric vehicles.

 

Silica Sand

Silica sand is probably one of the more underrated of the world’s resources, being as it is the second most consumed globally after water.

Silica sand is demand as the primary ingredient for all glass and concrete, making it the foundational ingredient of the modern city.

Silica sand also has a crucial role to play in the global decarbonisation effort as high purity silica sand with a low iron content is needed for the high-tech flat glass used in solar panels and smart screen technology.

 

Silver

Silver has been giving gold a good run for its money of late, in fact the past twelve months has seen the second most shiny of the precious metals rising by more than 25 per cent this year to mid-August.

Silver is not often credited for its photovoltaic contribution, but being a quiet achiever the part it plays in generating solar power grew 64 per cent to a record high with analyst predicting strong growth to come.

There are many other uses for silver, including in medicine, the automobile industry – combustion and electric, as a water purifier, and is used in brazing and soldering.

A further approx. 280 million ounces (nearly 9,000 tonnes) of silver used in photography, silverware and jewellery manufacturing each year.

 

Tin

Tin is a white metal at room temperature that is soft and highly rust-resistant and fatigue-resistant.

Tin is non-toxic and highly malleable, which means it is easily shaped to suit the demands of its users.

Tin alloys easily with other metals, has a low melting point and is easy to recycle.

Of the many important uses for tin, the most common is to produce tinplate, or steel coated tin to be used for food packaging.

Tin and tin alloys are used also for solder, especially in the electronics industry.

It is commonly used as an alloy for bearing metal and as an alloy in metallic coatings.

 

Uranium

Uranium has found its way back to the national consciousness due to recent power policy shifts announced by the Federal Opposition.

Uranium is used to power nuclear power plants to generate electricity.

The energy produced by uranium creates steam that turns the turbines in the power plant which generate electricity.

Australia has the world’s largest Economic Demonstrated Resources of uranium and in 2022 was the world’s 4th largest uranium producer.

Australia, at present, has no commercial nuclear power plants and has very limited domestic uranium requirements.

Australia exports all its uranium production to countries that have signed bilateral safeguards agreement to ensure Australian uranium is only used for peaceful purposes and does not contribute to any military applications.

 

 

CLICK HERE TO VIEW THE NEW WORLD METALS INVESTMENT SERIES PROGRAM

 

 

Gold Continues Being Bankable Exploration Target

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COMMODITY CAPERS: Gold, it seems, is worth its weight in itself these days and there are plenty of explorers out there eager to find more of it.

One only needs look at the number of companies that last year were spruiking discovery of lithium on their gold tenements to now finding gold on their lithium tenements to see how trends have changed.

With the price of gold hovering around US$2539 per ounce why wouldn’t they?

This week presented plenty to see in the gold exploration sphere, here’s some news from the sector:

 

Barton Gold Holdings (ASX: BGD) reported high-grade assays from the Tarcoola Goldfield at the company’s Tarcoola gold project in South Australia.

Barton Gold Holdings received assays from recent drilling that it declared to have confirmed the new Tolmer gold mineralised system, comprised of quartz veining within a broader zone of alteration.

Barton Gold explained the assays received from approx. 100 metres spaced drill lines indicate potential for a zone of continuous high-grade mineralisation, which is subject to confirmation via further drilling.

Barton is currently planning follow up drilling programs later this year, including aircore and further RC definition drilling, to help define the potential extent of the Tolmer footprint and potential continuity.

“We are excited to confirm that the first significant test of Tarcoola’s new structural model has confirmed a new gold mineralised system at Tolmer,” Barton Gold Holdings managing director Alexander Scanlon said.

“We have also successfully intersected high-grade mineralisation at multiple other targets, demonstrating Tarcoola’s broader potential to host multiple shallow, high-grade gold zones.

“We are also awaiting further assay results from the open pit Perseverance Mine, where we are hoping to convert further shallow mineralisation in the pit floor into additional high-grade Resources for a ‘Stage 1’ operation.”

TO READ THE FULL BARTON GOLD HOLDINGS ANNOUNCEMENT: CLICK HERE

 

Brightstar Resources (ASX: BTR) received first results from RC infill drilling carried out at the Lord Byron deposit, part of the company’s 293,000 ounce Jasper Hills gold project near Laverton in Western Australia.

Brightstar Resources explained the program is targeting gold mineralisation within conceptual open pit shells beneath and between the existing open pits to increase confidence in the current resource.

The drilling is part of a RC and diamond drill-out at Jasper Hills, which the company has designed to infill the resource, improve the JORC classification and provide information for mine planning at the proposed Lord Byron open pit and Fish underground mines announced in the Jasper Hills Scoping Study.

Initial assays included:

LBRC24034
32 metres at 1.25 grams per tonne gold from 53m;

LBRC24007
24m at 1.53g/t gold from 53m;

LBRC24008
5m at 4.29g/t gold from 92m; and

LBRC24054
9m at 1.47g/t gold from 29m, and
7m at 3.36g/t gold from 129m.

“These assays represent the first results from the recently acquired Linden Gold exploration package at the Jasper Hills gold project,” Brightstar resources managing director Alex Rovira said.

“The results are highly encouraging and align with grades and widths we expected from the existing 244,000 ounce gold mineral resource.

“The increased confidence from this infill drilling will feed back into future resource estimates and ultimately help guide the near-term development of open pit mining operations at Lord Byron, as detailed in our recent scoping study, which outlined the highly profitable production of 2.2 million tonnes at 1.6 grams per tonne for 115,000 ounces of gold over three years.”

TO READ THE FULL BRIGHTSAR RESOURCES ANNOUNCEMENT: CLICK HERE

 

Delta Lithium (ASX: DLI) recently completed metallurgical testwork for the Baldock gold deposit at the company’s Mt Ida gold project in Western Australia.

Delta Lithium took receipt of the results just as it also received Mining Approval from DEMIRS for underground mining at Baldock, resulting in the Baldock Area now being fully permitted for open pit and underground mining activities.

The company had also completed an internal Scoping Study, the results of which provided the company with the impetus to approve an additional $5 to $6 million expenditure at Mt Ida.

This expenditure will be focussed on drilling the gold resources with the aim of growing the existing 752,000 ounces at 3.5g/t gold resource to over the magic one million ounce mark to genuine standalone scale.

Delta has commenced reviewing options for a standalone gold plant at Mt Ida.

“Receiving the underground mining approval means Delta now has all approvals in place to commence mining operations at Baldock, during a period of historically high Aussie dollar gold prices,” Delta Lithium managing director James Croser said.

“An internal Scoping Study has demonstrated that Mt Ida has real potential to be a highly profitable gold mine on the basis of the current MRE.

“Metallurgical composites have been tested from along the extent of the 3km strike at Baldock, across multiple of the largest lodes, and show Mt Ida’s gold can be extracted easily utilising a standard CIL adsorption process.

“These important answers have given the company confidence to approve targeted gold drilling at Mt Ida.

“The aim is to grow the existing resources to beyond +1Moz and create the best opportunity for genuine standalone scale.

“The mobilisation of the diamond rig targeting deeper high-grade zones will occur in the coming weeks, to join the existing RC program.”

TO READ THE FULL DELTA LITHIUM ANNOUNCEMENT: CLICK HERE

 

Will Ghosts of Transgressions Past Rewrite Study Template?

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COMMODITY CAPERS: In 2020, Rio Tinto infamously destroyed the Juukan Gorge in Western Australia, the reverberation from which continues to cause wobbles in the corridors of permitting power.

This was on show last week when the Federal Minister for the Environment, Hon Tanya Plibersek MP, put the kybosh on Regis Resources’ (ASX: RRL) McPhillamys gold project in New South Wales by partially upholding a Section 10 Objection under the Aboriginal and Torres Strait Islander Heritage Protection Act 1984.

We can’t pretend to know what discussion transpired when the document landed on Minister Plibersek’s desk, but let’s assume the spectre of past mining infractions (Rio, we’re looking at you) when it comes to sacred Aboriginal sites started rattling the office furniture.

Would signing off on the decision be a Sir Humphrey Appleby moment of political bravery, or would telling the company to rethink its proposal be a more prudent, Jim Thacker moment of pragmatism?

“I have decided to make a partial declaration under section 10 of the ATSIHP Act to protect a significant Aboriginal heritage site near Blayney, in central west New South Wales, from being destroyed to build a tailings dam for a gold mine,” Minister Plibersek said in her media release.

“The Wiradjuri/Wiradyuri people, who traditionally lived around the Bathurst area, have significant spiritual and cultural connections to the headwaters of the Belubula River.

“Because I accept that the headwaters of the Belubula River are of particular significance to the Wiradjuri/Wiradyuri people in accordance with their tradition, I have decided to protect them.

“Crucially, my decision is not to stop the mine.”

To say Regis Resources was bullish about the opportunity offered by the McPhillamys gold project would be an understatement with the company releasing a Definitive Feasibility Study (DFS) in July that demonstrated the project as being, “a value accretive, long-life, low operating cost, organic growth opportunity with robust financial metrics, located in the Central Tablelands of New South Wales”.

With the gold price currently on a very satisfying trajectory, the DFS delivered a scenario yielding peak annual production of 235,000 ounces of gold and average annual gold production of 187,000 ounces when at steady state production rates through years one to nine.

The process plant would treat approx. seven million tonnes per annum to recover a total of 1.71 million ounces of gold over 9.4 years of processing.

All In Sustaining Costs (ASIC) for the life of mine was estimated at $1,580 per ounce generating total EBITDA of $2.8 billion and pre-tax cash flow of $1.5 billion.

Who wouldn’t be excited by that? And who wouldn’t anticipate such a project, providing tax dollars to the government coffers and lots and lots of employment, to get a tick of approval using the Minister’s thickest Texta?

In its response Regis noted Minister Plibersek stated her decision “will not stop the mine”.

“To the contrary”, the company said, “this decision does impact a critical area of the Project development site and means the Project is not viable”.

Regis acknowledged that, “while a number of alternatives were considered early in the design process, the Project does not have any currently viable alternative infrastructure locations”.

The decision potentially throws a whole new shape to studies undertaken by companies in the future as where a company may or may not put a tailings dam might no longer be a definitive aspect of a DFS.

A DFS is, by name, definitive. Meaning there is not any wriggle room when a spanner is thrown amongst the pigeons.

Should a DFS then, be so black and white?

If it means a company is sent back to the drawing board, meaning more time and money to be spent on a reconfiguration shouldn’t there already be a Plan B scenario in place?

A DFS is an expensive exercise. This one was the culmination of years of works plus several truckloads of cash, which means to revisit and revise will involve spending more time and investment dollars that are presently thin on the ground even with the skyrocketing gold price.

We don’t pretend to fully understand the repercussions involved, we are after all a journalist, not an engineer, although there is any number of journos out there purporting to have all the answers.

We simply ask the question. Does a DFS have to be so definitive, or could there be more scope for alternatives, especially given the wavering concern of those signing off on such ventures regarding possible damage to indigenous cultural sensitivities?

In her media release, Plibersek revealed Regis had indicated had, “assessed around four sites and 30 potential options for the tailings dam”.

“Protecting cultural heritage and development are not mutually exclusive,” she said.

“We can have both.”

Regis accepted this, however, responded to say that although, “there were multiple locations and potential options for the TSF (tailings storage facility) that were assessed, Regis notes that these were not currently viable options for the Project.

“To advance an alternative TSF solution will require further extensive investigations and studies along with the restart of the state and federal approvals process, which could take between five and ten years, ultimately with no certainty of a viable alternative being realised.”

The Association of Mining and Exploration Companies (AMEC) declared the Minister’s decision would make the $1 billion McPhillamy’s gold project unviable in its current form.

“The $1 billion investment to build the mine, the 580 construction jobs, the 290 operational jobs, and $200 million dollars of royalties to the State, as well as real benefits for local Traditional Owners, just went up in smoke,” AMEC CEO Warren Pearce said.

“This is an incredibly disappointing decision that lacks reason and common sense, and sets a truly terrible precedent for investment risk in Australia.”

AMEC conceded that Regis would now need to consider a possible new pathway for the eventual development of the project, however, if this were possible, it will now require an all-new State and Federal approvals process adding years to any completion date.

“If any project, no matter how thoroughly consulted, negotiated, supported and assessed, can be knocked over by the objections of only a few people at the end of the process, then how can any company or investor have confidence to invest in Australia,” Pearce continued.

“The absolute absurdity of this this decision, is that in upholding the Section 10 Objection the Minister has chosen to ignore the views of the recognised Traditional Owners for this country (the Orange Local Aboriginal Corporation), who did not object to the Project.

“They could see the value and future prosperity that this project could bring to their people. It’s a shame the Minister didn’t listen to them, while purporting to protect their interests.

“Instead, the Minister has chosen to prioritise the views of a small number of persons, who are not the local lands council.”

McPhillamys still has the potential to be a multi-billion dollar project that could deliver positive outcomes.

The NSW state government would welcome the projected approx. $200 million in royalties with the Federal government enjoying a healthy boost to the Australian economy.

Add in the projected 580 full-time jobs in construction and around 290 full time jobs when in production, McPhillamys stands out as a project of some significance.

It will cost more for companies to have a Plan B up their sleeve, but with the uncertainty surrounding who ticks off what and why they may not, surely a DFS needs to be a bit more Flexible.

We wait with bated breath to see which up and coming project will be the first to release a completed FDFS?

 

 

Gold Juniors Embrace Shining Opportunity

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COMMODITY CAPERS: Hump day arrived this week bringing with it a gold price of US$2,473.40 per ounce, giving gold producers and explorers alike something to smile about.

With his recently pinged right ear bandaged up for his arrival at the Republican Party love-in, prospective POTUS, Donald Trump could be given some credit for the spike in the most precious of metals’ pricing.

Gold has received quite a bit of attention of late, mainly due to a concerning rise in geopolitical tensions.

The concerns have resulted in renewed consolidation of its ‘safe haven’ status with it being a physical, relatively scarce asset that has historically held its value in times of global uncertainty.

Trump’s obfuscation over America’s support for The Ukraine in the Russia Ukarine war and his prior pacification of Russia – and by extension its leader Vladimir Putin – over the suspected Russian interference in his 2016 election have gold buyers forming queues around the world looking to shore up a secure store of value.

Gold has been on a healthy run, averaging about US$2,200 an ounce in the first half of 2024, up 15 per cent year-on-year due to strong demand from investors and even more from central banks.

Central bank buying has been at historic highs over the past two years, which has continued in 2024.

If you guessed China is the leading central bank gold purchaser, then you move one step away from The Chaser.

“China is the leading central bank gold purchaser in a move many see as part of the trend towards “de-dollarization” i.e countries distancing themselves from the USD as the global reserve currency,” Shaw and Partners noted in it’s the Research Monitor September Quarter 2024 report.

“Chinese consumers have flocked to gold as their confidence in investments like real estate or stocks, that have traditionally performed well, has faltered.”

The bean counters at the Office of the Chief Economist have forecast gold prices to remain elevated throughout 2024 and 2025, before easing slightly in 2026.

This, it said in the Department of Industry Science and Resources June 2024 Resources and Energy Quarterly rolled on the back of a year-on-year four per cent decrease in Australian gold production in the March quarter 2024, due to lower grades and disruptions from heavy rainfall.

“Production is forecast to grow over the outlook period as major new projects and expansions come online,” DISR said.

“Gold export earnings are expected to reach a record $33 billion in 2023 24, easing to around $31 billion in 2025–26 as prices gradually decline from record levels in Australian dollar terms.

Shaw and Partners identified that although the gold price climbed in 2023, funds raised by junior and intermediate gold companies continued to decline for the second consecutive year.

“Unlike major producers that self-fund their exploration, juniors heavily rely on capital markets to fund their programs,” Shaw and Partners said.

“In the past three years, junior companies accounted for more than 50 per cent of total exploration budgets.

“Constrictive market conditions for gold consequently reduced the exploration budgets in 2023 by 16 per cent YoY to US$5.9B with IR related exploration budgets declining 19 per cent YoY to US$2.5B, the lowest since 2020.”

This hasn’t stopped some juniors from making an impact.

 

Great Boulder Resources (ASX: GBR) has been busy of late at the company’s Side Well gold project near Meekatharra in Western Australia.

The company most recently announced having identified two new large, high-priority gold targets at the Side Well gold project via soil auger sampling.

The first is a 2.4 kilometres-long Ironbark-style target with peak gold values of 75ppb gold with the second being a 1.4km-long bismuth-molybdenum anomaly, displaying the same pathfinder elements as Mulga Bill, including bismuth assays up to 475 times background levels.

“We recently completed a program of wide-spaced surface sampling over the Side Well South area, extending coverage to the bottom of the Side Well project,” Great Boulder Resources managing director Andrew Paterson said.

“This data has confirmed mineralisation continues south through our tenements and the known hydrothermal system now covers more than 18 kilometres of strike.

“At Side Well South we’ve identified two new targets collectively spanning 3.8 kilometres of strike.”

The company had earlier completed aircore (AC) drilling at the project’s Mulga Bill North target that added definition to gold mineralisation approximately 500m north of the Mulga Bill resource envelope.

The company explained on announcing results that the program is part of an ongoing process it is carrying out to identify and define additional gold mineralisation to expand the existing 568,000 ounces gold Mulga Bill Mineral Resource.

Highlights include:

24SWAC214
12m at 2.61 grams per tonne gold from 88m, including 4m at 4.27g/t gold from 93m;

24SWAC216
4m at 5.03g/t gold from 84m and 3m at 2.31g/t gold from 112m;

24SWAC211
3m at 2.68g/t gold from 114m; and

24SWAC220
9m at 1.95g/t gold from 100m.

Earlier drilling at the northern end of Mulga Bill, resulted in Great Boulder claiming discovery of a new shallow high-grade vein extending approx. 150 metres north of the Side Well JORC Mineral Resource of 7.45 million tonnes at 2.8 grams per tonne gold for 668,000 ounces of gold.

Highlights from the recent campaign include:

24MBRC001
32 metres at 8.38 grams per tonne gold from 104m, including 18m at 13.76g/t gold from 104m;

24MBRC002
16m at 2.12g/t gold from 108m, including 4m at 5.68g/t gold from 108m; and

24SWAC194
26m at 3.31g/t gold from 88m, including 8m at 10.02g/t gold from 88m.

The new vein discovery at Mulga Bill extends into Mulga Bill North, where drilling has defined gold mineralisation over 1.5km of strike.

“This is an extremely exciting development at Mulga Bill, with the discovery of a thick high-grade vein immediately north of the current Mulga Bill resource,” Paterson said.

“Our drilling has defined it over 150 metres of strike, with indications that it could extend 350 metres or more.

“This new discovery connects the Mulga Bill and Mulga Bill North prospects.”

 

Mt Malcolm Mines (ASX: M2M) is making solid progress at the company’s Golden Crown gold prospect in Western Australia.

The company has carried out activities with the aim of establishing the feasibility of wet gravity processing at a nearby third-party plant while assessing the mineability of the shallow high-grade ore at the prospect.

A Reverse Circulation (RC) drilling program completed earlier this year outlined a well-defined mineralised area, which the company considers a solid foundation for robust maiden Mineral Resource Estimates.

The RC drilling produced the highest recorded intersection for Golden Crown of:

24GCRC060
6 metres at 24.46 gras per tonne gold, including a broad high-grade zone of 10m at 15.4g/t gold.

Other high-grade intercepts included:

24GCRC032
4m at 3.29g/t gold (20-24m);

24GCRC033
4m at 5.23g/t gold (22-26m);

24GCRC048
3m at 6.88g/t gold (0-3m); and

24GCRC059
4m at 4.43g/t gold (14-18m).

The drilling entailed 18 shallow grade control drillholes along three designated lines, within an area designated to support bulk sampling testwork that is hoped to demonstrate the economic viability of processing of upcoming bulk samples in the wet gravity plant, offering crucial insights into resource development potential.

“The primary objective of the Golden Crown bulk sampling work is to enhance our understanding of the ore’s geological properties, such as grade variance, metallurgical characteristics, and future mineability,” Mt Malcolm managing director Trevor Dixon said.

“This information is crucial for our future planning of efficient and cost-effective mining operations.

“The bulk samples will assist in verifying gold grade and continuity at Golden Crown whilst also evaluating the feasibility for any potential future mining operations that can provide a saleable gold product to the company.”

 

 

Predicting the Future Requires the Correct Lenses

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COMMODITY CAPERS: The old adage goes that fortune tellers don’t ride horse because they have crystal balls, however there are some glass orb gazers who seem to have their antennae highly tuned.

The resources sector provides the optimum opportunity for investors brave enough to punt on the aspirations of geologists turned company directors.

Anybody who was fortunate, or canny, enough to get on the recent Azure Minerals slingshot was suitably rewarded for their investment when the price was at, in retrospect, a bargain at around 50 cents, before the ride began.

Not everybody, however, is adept at reading the potential prosperities of the junior end of town, but thankfully there are some out there prepared to put their neck, and reputation on the line.

As 2024 broke through the dismal investment pall that hung over the market in 2023, half a dozen or so analysts from broking firm ShawandPartners adjusted the vertical hold on their screens to provide punters with some foresight.

Not all companies covered were in the Resources realm, so we have included here the ones that we consider the most interesting to our readers.

 

AIC Mines (ASX: A1M)

ShawandPartners liked AIC’s ownership of the high-grade operational Eloise copper mine in Queensland and was looking forward to the company bringing its then recently-acquired Jericho copper deposit into production.

“A1M is the quality junior copper producer on the ASX,” the analysts said at the time.

“The company offers investors one of the few ways to invest in a simple leveraged exposure to the copper price.”

In March, AIC Mines announced an increase to the Jericho Ore Reserves to 3.2 million tonnes at 1.9 per cent copper and 0.4 grams per tonne gold for 61,100 tonnes of copper and 37,000 ounces of gold, which at the time represented an 86 per cent increase in contained copper and an 86 per cent increase in contained gold.

A subsequent increase of Resources and Reserves at Eloise took combined Eloise and Jericho Ore Reserves to 5.6 million tonnes at 2.1 per cent copper and 0.5g/t gold for 119,200 tonnes copper and 84,050 ounces gold.

The company’s combined Mineral Resources at Eloise, Jericho, plus Sandy Creek and Artemis leapt to 22.9 million tonnes at 2.1 per cent copper and 0.5g/t gold for 471,950 tonnes copper and 353,950 ounces gold.
After being granted the Jericho mining lease, AIC Mines commenced of development for the Jericho copper mine via an underground link drive directly from the Eloise decline.

This week, the company advised it had received firm commitments for $57.2 million to develop the Eloise to Jericho Link Drive.

 

Firefly Metals (ASX: FFM)

Firefly Metals had just rebranded from previous moniker, AuTECO and in the process readjusting its focus from gold to copper through the purchase of the Green Bay copper-gold project in Newfoundland, Canada.

ShawandPartners were fans of the company offering investors a simple exposure to copper exploration.

“Steve Parsons has rejoined as CEO and Mike Naylor as executive director,” ShawandPartners said.

“Both are well known to the market and have an established track record of success.”

The Green Bay copper-gold project hosts a mineral resource prepared in accordance with Canadian NI 43-101 of 39.2 million tonnes at 2.1 per cent copper for 811,000 tonnes copper equivalent (CuEq).

Firefly wasted little time getting the drill rigs spinning at Green Bay, which has demonstrated the mine hosts two distinct styles of copper mineralisation: One contains high-grade copper-gold massive sulphide zones (VMS) and the other a large-scale, copper-rich Footwall Zone (FWZ).

The drilling returned results with high grades and strong widths well beyond the existing resource boundary.

This provided impetus for the company to accelerate its growth campaign, with drilling being conducted from the underground exploration drive, making it faster, cheaper, and more accurate.

FireFly Metals was rewarded via a highly successful share placement, through which the company raised $52.2 million.

“We decided to raise such a substantial sum in light of the exceptional drilling results we have been generating and the increasingly obvious scope to grow the resource quickly by extending the known mineralisation and testing the compelling targets nearby,” FireFly Metals managing director Steve Parsons said at the time.

“The result is a game-changing event for FireFly.

“We are now fully funded for the next 18 months, during which time we will have two underground rigs and one surface rig working flat out to grow the resource.”

 

Metro Mining (ASX: MMI)

Metro Mining operates the Bauxite Hills bauxite mine in far north Queensland, from which the company ships approx. 5 million tonnes per annum of bauxite to China that it is in the process of expanding to 7Mtpa.

Being a bauxite producer at this point in time is fortunate with plenty of action for the commodity on a global scale.

According to the March 2024 Resources and Energy Quarterly from the Department of Industry, Science and Resources chief economist there has been growth in bauxite consumption.

The United Arab Emirates (UAE) increased global bauxite usage by 0.3 per cent year-on-year in 2023 to 361 million tonnes.

An Indonesian ban on bauxite exports boosted Australian bauxite export volumes and values by 4.3 per cent (to 37 Mt) and 48 per cent (to nearly $1.7 billion) year-on-year in 2023, respectively.

In the December quarter 2023, Australia enjoyed record export earnings of over $0.5 billion, most of which – some 98 per cent went to China.

An expected rise in bauxite exports in 2024 is likely to boost Australia’s aluminium, alumina and bauxite (AAB) export earnings to $17 billion in real terms in 2023–24 (Figure 11.14). Disruptions to bauxite exports from Guinea are expected. In Guinea, bauxite mines are dependent upon diesel for their operations.

Damage to a major oil depot in Guinea from an explosion in December 2023 hurt that country’s production as its mines rely on diesel fuel. The damage is likely to take more than two years to repair.

“As the world’s 2nd largest bauxite exporter, Australia is in the box seat to fill the loss of bauxite from Guinea,” the DISR bean counters said.

“In China’s Guangxi province, alumina refineries are encouraged to use imported bauxite with preferential support from the local government.”

Metro Mining CEO Simon Wensley visited Chine in March, when negotiations were concluded on contract volume and prices for Q2 2024.

The company’s offtake is fully committed for 2024 with three main customers and its FOB price for Q2 2024 will be up to 20 per cent higher than Q4 2023.

 

Peninsula Energy (ASX: PEN)

Peninsula Energy is restarting uranium production from the Lance ISR (In-situ Recovery) uranium project in Wyoming, US.

Uranium from Lance is leached from the orebody in an acid solution before being recovered in an ion-exchange resin.

“Nuclear energy is enjoying a renaissance around the globe as governments have realised that decarbonisation of power grids requires nuclear energy,” ShawandPartners said.

“There has been little investment in uranium supply since Fukushima and as a result, uranium prices are surging higher and could spike well above US$100/lb in 2024.”

When ShawandPartners covered the stock in December it noted the company was expecting first production in late 2024.

That is still on the cards with the company announcing an updated processing plan in August this year which declared first production was anticipated in December 2024 and ramping up to 1.8 million pounds steady state by 2029.

Peninslua Energy recently completed an Equity Raising banking approx. $106 million putting it in a strong financial position to complete key development and construction activities at Lance.

“The work at Lance is continuing at full pace and we remain on track for commissioning later this year,” Peninsula Energy managing director and CEO Wayne Heili said.

“This funding provides us with balance sheet strength to take us through until anticipated sustainable free cashflow generation in Q3 2025.

“We are still progressing debt discussions but felt this opportunity delivers a high-level of financial certainty to shareholders in respect to our funding requirements.”

 

 

Renewable Alternative to Small Modular (nuclear) Reactors

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COMMODITY CAPERS: There’s been much chat around of late concerning Small Modular (nuclear) Reactors (SMRs), but what exactly are they and is there a renewable alternative?

In a 2020 posting on the Australia’s Nuclear Science and Technology Organisation (ANSTO) web page, the government department described SMRs as “modular” simply because one unit can be assembled next to another and scaled up or down to meet local electricity needs.

SMRs are also said to be designed to “plug in” to existing power networks, which is what has given rise to their consideration as a power source as they are supposed to replace an aging power station with a “modern, reliable, and zero-emissions power source”.

Their notoriety grew when US company NuScale Power emerged as a front runner in the technology with it anticipated to be on the way of producing the first SMR to win a license from the U.S. Nuclear Regulatory Commission for construction.

Things got off to a flying start for the company in 2020 when the US Department of Energy approved $1.35 billion over 10 years for the plant, known as the Carbon Free Power Project.

NuScale was on the march having planned to develop a six-reactor 462 megawatt project with the Utah Associated Municipal Power Systems (UAMPS) and launch it in 2030, but as time went on and costs continued to rise, several towns pulled out of the project.

In November 2023, NuScale announced termination of the small modular reactor project.

A RENEWABLE ENERGY ALTERNATIVE EXISTS

Renewable energy storage plays a couple of fiddles down from second to renewable energy generation.

Boffins at the university of Newcastle in New South Wales decided there should be a bridging of that void and commenced working on technology that what was to become the basis for MGA Thermal.

MGA Thermal created a patented material it called ‘miscibility gaps alloys’ (MGA), using which it can build blocks that can store excess energy generated by renewable power stations.

The real smarts of the technology is that it could also be deployed in retired coal-fired power stations.

And, unlike nuclear fuelled power, there is no residual waste as the MGA blocks, when spent can be recycled to make new MGA blocks.

The MGA blocks are designed utilising two key materials.

Tiny metal alloy particles are dispersed through a matrix material that melt as the blocks are heated and energy is absorbed.

At the same time matrix material remains solid and keeps the molten particles in place.

The energy is stored in the solid-to-liquid phase change and is released as the blocks cool and the particles become solid again.

MGA Blocks are used in Thermal Energy Storage Systems (TESS) which deliver continuous high temperature heat or electricity that is safe, low cost, sustainable and high capacity.

TESS enables a scalable means of firming variable renewable generation into a highly reliable and versatile supply of process heat, heat & power (cogeneration) or steam for electricity generation.

The system has minimal need for expensive capital equipment making it a good fit for power station retrofits as the MGA Storage can seamlessly plug into existing electricity generation infrastructure allowing for ultra-low carbon energy storage.

The system can simultaneously charge and discharge, enabling a continuous 24/7 discharge of renewable energy.

MGA Thermal has received funding from the Australian Renewable Energy Agency (ARENA) for a demonstration plant.

MGA Thermal hopes the plant will validate the technical performance of its TES technology under a variety of end-use case simulations and demonstrate the potential role that TES technology could play in the Australian energy market including for dispatchable electricity and process heat.