BCI Minerals Tips Higher Iron Ore Earnings

THE BOURSE WHISPERER: BCI Minerals (ASX: BCI) is anticipating a healthy windfall from the recent rise in global iron ore prices.

BCI Minerals said it expects increased EBITDA from Iron Valley for the June 2019 quarter compared to the levels reported for the first three quarters of the current financial year (FY19).

Iron Valley is a mine in the Central Pilbara region that is operated by Mineral Resources (ASX: MIN) and has Ore Reserves of 95 million tonnes at 58.4 per cent iron (as at 30 June 2018).

BCI receives a quarterly royalty from MIN and the company’s EBITDA from Iron Valley has ranged between $5.6 million (FY18) and $18.3 million (FY17) since operations commenced in 2014.

BCI previously reported its EBITDA from Iron Valley for the first nine months of FY19 was $6 million from 5.5 million tonnes shipped and that it expects Iron Valley EBITDA for FY19 of between $6 million and $12 million.

However, iron ore prices have enjoyed a large spike during the last six months due to global supply issues and ongoing strong steel demand and have been particularly strong in the June 2019 quarter to date, with the CFR 62 per cent Fe iron ore price averaging US$96 per dry metric tonne (dmt) in April and May and the spot price currently at US$105/dmt.

This compares to an average of US$74/dmt for the first nine months of FY19.

Discounts for 58 per cent Fe iron ore products have also reduced materially and are at the lowest level in more than three years, leading to a reduction in discounts for Iron Valley product.

Although most of the recent Iron Valley shipments have been iron ore fines, which has a lower price than lump, overall pricing for Iron Valley product has been strong, particularly in April and May 2019.

BCI now expects FY19 EBITDA from Iron Valley to be between $11 million and $12 million, which is at the upper limit of the company’s previous estimate.

“If the iron ore market and MIN production levels remain at current levels, FY20 is expected to be another positive year for BCI’s Iron Valley royalty,” BCI Minerals said in its ASX announcement.

“Potential further upside exists if the proportion of lump shipped by MIN returns to long range average levels.”

BCI Minerals currently boasts a cash position of $34.8 million (as at 31 May 2019).

Combined with stronger royalty earnings from Iron Valley, the company believes it is in good stead to continue advancing its Tier 1 development project, the Mardie salt & potash project, located on the West Pilbara coast in the centre of Australia’s key salt production region.

The Mardie project is expected to produce high-purity salt (typically 99.7 per cent NaCl) and sulphate of potash (SOP) via solar evaporation of seawater.

“Using an inexhaustible resource and a production process driven mainly by natural solar and wind energy, Mardie is a sustainable opportunity to supply the salt and potash growth markets in Asia over many decades,” BCI Minerals explained.

“The long-term demand outlook for both salt and SOP is positive.

“High purity salt produced at Mardie will be used in chemical and industrial processes that create thousands of everyday products.

“Demand in this market segment, particularly in Asia, is expected to grow strongly over the next decade and result in a supply deficit.”

 

Email: info@bciminerals.com.au

Website: www.bciminerals.com.au

 

Companies of Interest Presenting at Gold Coast Investment Showcase

THE CONFERENCE CALLER: The 2019 Gold Coast Investment Showcase is just two weeks away and The Resources Roadhouse continues its look at companies that will be in attendance.

 

Pioneer Resources (ASX: PIO) informed the market of TSX-listed Novo Resources Corp.’s intention to enter into a US$30 million farm-in and Joint Venture agreement with Sumitomo Corporation of Tokyo, Japan, and its wholly-owned Australian subsidiary.

The aim of the JV is to advance Novo’s Egina project located approximately 80 kilometres south-southwest of Port Hedland in Western Australia.

The Egina project includes Pioneer Resource’s Kangan gold project, where Novo is currently earning an interest under a binding memorandum of agreement that has now been replaced with a new agreement on essentially the same terms that allows Sumitomo to become a party to it.

Pioneer retains a 30 per cent free-carried interest in the Kangan project up to a decision to mine, after which it becomes a contributing JV partner.

Pioneer explained that Sumitomo, via an Australian subsidiary, has agreed to join Novo in spending $460,000 within the next 18 months to earn a joint 70 per cent interest in the Kangan gold project.

Upon Novo and Sumitomo earning their combined 70 per cent interest, Pioneer is free carried up to a decision to mine and thereafter contributes in proportion to its JV interest.

The Kangan gold project, currently held 100 per cent by Pioneer, forms a key part of Novo’s Pilbara exploration portfolio and sits within that company’s Egina project, which lies in the heart of the Pilbara conglomerate gold province.

“The addition of Sumitomo to the Kangan farmin/JV adds significant financial and technical power to support Novo’s efforts at the Kangan JV project, and we look forward to receiving results as exploration programs at Egina and Kangan advance,” Pioneer Resources managing director David Crook said.

The gold deal comes as Pioneer maintains its caesium-focus with drilling underway at the company’s Sinclair lithium-caesium-tantalum (LCT) Pegmatite at its 100 per cent-held Pioneer Dome project near Norseman in Western Australia.

The drilling coincides with the company’s plans for a third shipment of pollucite scheduled for the third week of June 2019.

The RC drilling, comprising 2,000m, has been designed to discover extensions to the core zone of the Sinclair Pegmatite, which contains the complex array of alkali metal minerals including pollucite, potash feldspar, petalite, lepidolite and cleavelandite.

Drilling will test a zone approximately 150m long both to the north and south of the pit.

A further 500m of diamond core drilling will commence as the RC drilling phase nears completion, targeting pollucite mineralisation extensions and caesium anomalies that occur to the north of the Sinclair Pit.

 

Matsa Resources (ASX: MAT) recently announced the execution of an Ore Purchase Agreement with AngloGold Ashanti Australia (AGAA) for the purchase of ore from the company’s Red October mine.

Matsa Resources informed the market that ore from Red October is to be treated at the AGAA-owned Sunrise Dam gold mine, for up to five years.

The 3.8 million tonne per annum mill at the Sunrise Dam gold mine is located approximately 60 kiloetres from the Red October gold mine and provides Matsa with access to a nearby milling solution for its Stage 1 production ore and for a further 4.5 years thereafter.

Matsa has previously delivered ore from its Fortitude and Red Dog gold mines to Sunrise Dam and is confident in the outcomes of the ore processed there.

Matsa will be responsible for mining and transporting the ore to Sunrise Dam with AGAA taking possession of ore once delivered.

The company said the agreement will allow Matsa to continue to progress mining at the Red October gold mine at a relatively low capital cost.

“The execution of the Agreement with AngloGold Ashanti continues our strong relationship and builds on the MoU both parties entered into in mid-2018,” Matsa Resources executive chairman Paul Poli said.

“Previous mining campaigns at Fortitude and Red Dog have been successfully processed at Sunrise Dam with minimal fuss and we expect this to be no different.

“The fact that AngloGold are prepared to potentially accept all ore from Red October for up to five years is testament to this as Matsa looks to develop a longer term mine plan in the future.”

 

Graphite-focused Renascor Resources (ASX: RNU) has been bust at the company’s 100 per cent-owned Siviour graphite project, located in South Australia’s Eyre Peninsula.

Renascor Resources received a Letter of Interest (LoI) for export credit agency (ECA) cover from Atradius Dutch State Business, the Government of the Netherlands’ official ECA

The LoI came after a preliminary assessment of the Siviour graphite project by Atradius on behalf of the Dutch State, confirming in principle project finance support under the Dutch export credit guarantee scheme.

Atradius is the official ECA that administers the ECA scheme for the Government of the Netherlands.

In order to promote Dutch exports, Atradius offers insurance and guarantee products for projects involving the export of capital goods from the Netherlands.

ECA Cover from Atradius is often used to assist Dutch exporters in winning export transactions and increasing the capacity to raise finance from banks for projects involving Dutch exports.

The Dutch ECA scheme was identified as applicable to Renascor’s Siviour project based on the sourcing of Dutch content through Renascor’s Dutch strategic engineering partner, Royal IHC.

Renascor has estimated that up to approximately 60 per cent of project capital expenditure is expected to qualify under the Atradius ECA Cover.

Renascore also had a Mineral Lease for the Siviour graphite project granted by the South Australian Minister for Energy and Mining.

The grant came on the back of three-years of preparation and review of all potential environmental, social, economic and technical aspects of the project.

A positive Pre-Feasibility Study confirmed the opportunity to unlock further value from Siviour through Australia’s first integrated graphite concentrate and spherical graphite operation.

Renascor believes the project economics of the Spherical PFS highlight Siviour’s potential to achieve high economic returns through the vertically integrated development of a mine and flake graphite concentrate operation, plus downstream production of spherical graphite.

The company also upgraded the JORC Mineral Resource estimate for the Siviour project after completion of an infill drill program, which was conducted to improve the confidence in the Siviour Indicated Resource

This resulted in a Measured Resource estimate of 15.8 million tonnes at 8.8 per cent total graphitic carbon (TGC) for approximately 1.4 million tonnes of contained graphite.

The total (Measured, Indicated and Inferred) Siviour Mineral Resource estimate now consists of 87.4 million tonnes at 7.5 per cent TGC for 6.6 million tonnes of contained resource (with 64 per cent classified as Measured or Indicated).

 

De Grey Mining Achieves High Gold Recoveries with Conventional CIL Processing at Toweranna

THE BOURSE WHISPERER: De Grey Mining (ASX: DEG) announced positive results from metallurgical test work recently undertaken on samples from within the proposed Toweranna open pit resource area at the company’s Pilbara gold project in Western Australia.

De Grey Mining carried out test work to assess conventional carbon-in-leach (CIL) gold recovery from both oxidised and fresh rock.

The company indicated it had obtained high gold recoveries from all of the oxide zone samples, ranging from 92 per cent while the fresh rock samples returned results with 94.7 per cent gold recovery.

De Grey said the results indicate Toweranna mineralisation is free milling and fully amenable to convention CIL processing.

Separate samples were also tested for gravity recovery, with oxide and fresh rock samples returning recoveries of 20.8 per cent and 54.3 per cent respectively.

The company considers the high levels of gravity gold indicate that it may be possible to lift total gold recovery by installing a gravity concentrator ahead of the CIL circuit and as such will evaluate the merits of employing gravity extraction in subsequent test work.

“Toweranna continues to grow in stature with strong resource growth potential and high recovery with conventional CIL processing characteristics,” De Grey Mining technical director Andy Beckwith said in the company’s announcement to the Australian Securities Exchange.

“On-going drilling results continue to define multiple stacked lodes to at least 200 metres depth.

“Once drill assays are finalised, we will update the zero to 200 metres open pit resource and run open pit optimisations.

“We are increasingly seeing free gold in the veins in core and the high gold recovery together with the simple free milling nature is encouraging.

“Toweranna is poised as a game changer as it has the potential to rapidly increase resources and improve the PFS economics.”

 

Email: admin@degreymining.com.au

Website: www.degreymining.com.au

 

St George Mining Assays Confirm High-Grade Drill Hits

THE DRILL SERGEANT: St George Mining (ASX: SGQ) announced further thick intercepts of high-grade nickel-copper-cobalt-PGE sulphide mineralisation from Phase 1 of its 2019 drill program at the company’s Mt Alexander project in Western Australia.

St George Mining said it had received assays indicating that drilling had intersected nickel-copper sulphide mineralisation with the best intersections being at the Investigators prospect.

Laboratory assays for hole MARC118 confirmed thick intersections of high-grade nickel-copper-cobalt-PGE mineralisation of:

10 metres at 2.47 per cent nickel, 1.06 per cent copper, 0.07 per cent cobalt and 2.52 grams per tonne PGEs from 142m, including 3m at 3.85 per cent nickel, 2.12 per cent copper, 0.11 per cent cobalt and 4.22g/t PGEs from 145m and 2m at 5.04 per cent nickel, 1.47 per cent copper, 0.16 per cent cobalt and 2.12g/t PGEs from 150m.

St George explained that hole MARC118 was drilled along the north-south MAD60 Line at Investigators, where high-grade nickel-copper sulphide mineralisation had previoulsy been intersected from very shallow depths of 25m below surface and extending down-plunge for a length of more than 380m.

The company said the 10m thick high-grade intercept in MARC118 greatly extends the continuity of mineralisation on the north-south trending MAD60 Line.

High-grade mineralisation was also intersected in hole MARC109, which was drilled approximately 200m to the west-northwest of MARC118.

Assays for MARC109 returned:

4m at 1.21 per cent nickel, 0.47 per cent copper, 0.04 per cent cobalt and 0.99g/t PGEs from 200m, including 2m at 2.04 per cent nickel, 0.83 per cent copper, 0.07 per cent cobalt and 1.67g/t PGEs from 202m.

“The latest high-grade intersections at Investigators establish further continuity to the scope and scale of mineralisation at Investigators,” St George Mining executive chairman John Prineas said in the company’s announcement to the Australian Securities Exchange.

“Ongoing step-out drilling is being planned for Investigators, with two SAMSON EM anomalies in the northern section of the prospect area lined up as high-priority targets for the upcoming drill program.

“The SAMSON anomalies are corroborated by data from two separate geophysical surveys – the recent Sub-Audio Magnetics (SAM) survey as well as a prior moving-loop EM survey, and are compelling drill targets for the discovery of additional mineralisation.”

 

Website: www.stgm.com.au

 

AVZ Minerals Executes Strategic Relationship Agreement with Huayou Cobalt Group

THE BOURSE WHISPERER: AVZ Minerals (ASX: AVZ) informed the market that it has entered a strategic relationship with Shanghai-listed company, Zhejiang Huayou Cobalt Co. Ltd.

The deal has been struck via the latter’s group company, Huayou International Mining (Hong Kong) Limited.

AVZ Minerals explained the agreement would enable it to draw on Huayou Cobalt Group’s experience in the Democratic Republic of Congo (DRC) and mainland China as it completes a Definitive Feasibility Study for the company’s Manono lithium and tin project in the DRC.

AVZ expects Huayou will also be able to provide advice and assistance with respect to project financing, offtake financing, strategic services, EPCM and cost-effective transport of product to final recipients.

Huayou Cobalt Group is one of the world’s largest manufacturers of cobalt chemicals for use in batteries and has extensive in-country experience with several established cobalt mining and processing operations within the DRC.

Huayou is also a 9.47 per cent shareholder in AVZ.

AVZ outlined the strategic relationship that will emanate from the deal, saying it has been designed to promote discussions to advance Manono to production including, but not limited to, the Definitive Feasibility Study; project financing; off-take and EPCM; – Consideration of any other ways in which a relationship between the two parties may be beneficial for all stakeholders.

The Strategic Relationship agreement is non-binding and non-exclusive.

“AVZ values its existing relationship with Huayou very highly and this new agreement will see the two companies come even closer to advance the Manono project,” AVZ Minerals managing director Nigel Ferguson said in the company’s announcement to the Australian Securities Exchange.

“We believe that bringing Huayou’s tremendous mining expertise to bear on the DFS, financing and offtake negotiation will accelerate the commercialisation of the largest lithium ore body on the ASX and yield tremendous value for AVZ shareholders.”

 

Email: admin@avzminerals.com.au

Website: www.avzminerals.com.au

 

Alliance Resources Delivers New Weednanna Drilling Results

THE DRILL SERGEANT: Alliance Resources (ASX: AGS) announced results of diamond drilling recently undertaken at the company’s Weednanna gold deposit on the Eyre Peninsula of South Australia.

Alliance Resources completed five HQ sized diamond holes (19WDDH001-005) during January and February 2019 to provide metallurgical samples for the deposit’s fresh sulphide rock domains of Shoots 1, 2, 4, and 5.

Highlights of the results, included:

19WDDH001
39.1 metres at 3.51 grams per tonne gold from 46.9m, including 8.45m at 8.52g/t gold from 74.3m;

19WDDH005
9.4m at 12.45g/t gold from 97.3m, including 3.3m at 32.47g/t gold from 103.4m; and

19WDDH003
2.1m at 23.87g/t gold from 100.9m.

“The diamond drilling results have been provided to Alliance’s metallurgical consultants who are currently planning future metallurgical testwork to optimise the processing flowsheet and design of a gold processing facility for the Weednanna deposit,” Alliance Resources said in its ASX announcement.

 

Email: info@allianceresources.com.au

Website: www.allianceresources.com.au

 

Tanga Resources Commences Hagenhof Drilling in Namibia

THE DRILL SERGEANT: Tanga Resources (ASX: TRL) announced drillinhg has commenced at the company’s Hagenhof copper project in Namibia.

Tanga Resources explained the program has been updated to now consist of approximately 3,000 metres of diamond and Reverse Circulation (RC) drilling to test copper mineralisation at several targets at Hagenhof.

The company had to revise its previously announced RC drill program due to an unexpected delay in the arrival of an RC rig from South Africa, resulting in the drilling contractor providing a track mounted diamond drill rig, at no additional cost to the company, until the RC drill rig arrives, at which time the program will revert back to RC drilling.

“Diamond drilling has commenced at the Main Gossan targeting a prominent ground magnetic anomaly and will test the strike, plunge and grade of the historically reported copper mineralisation,” Tanga Resources said in its ASX announcement.

“It is expected that RC drilling will then test the prominent magnetic anomaly coinciding with a large interpreted structural domal feature at Liv’s Hill, before going on to test copper mineralisation at Jette’s Hill, Copper Cap and P5; all of which have never previously been drilled.”

 

Email: info@tangaresources.com.au

Website: www.tangaresources.com.au

 

De Grey Mining Scores Further High-Grade Intercepts at Toweranna

THE DRILL SERGEANT: De Grey Mining (ASX: DEG) released results for an additional 17 RC drill holes undertaken at the company’s Toweranna gold deposit in the Pilbara of Western Australia.

De Grey Mining has now completed the RC program with a total of 42 holes drilling in advance of 10,126 metres.

The company explained the RC drilling was undertaken on a 40m by 40m basis to allow for an open pit resource estimation to 200m depth, targeting lateral and depth extensions to the existing shallow 2018 Toweranna Mineral Resource of 2.01 million tonnes at 2.2 grams per tonne gold for 143,900 ounces.

De Grey stated the new drilling results confirm lateral extensions and additional stacked lodes and add further support to an anticipated substantial increase to the current open pit resource to 200m depth.

Potential to extend gold lodes beyond 200m is currently being evaluated with selected scout diamond holes testing for mineralisation between 200 to 600m depth.

Latest RC results include:

TRC153
11 metres at 2.11 grams per tonne gold from 45m;

TRC164
8m at 2.71g/t gold from 31m, including 3m at 6.73g/t gold from 35m;

TRC157
7m at 9.27g/t gold from 209m, including 1m at 25.5g/t gold from 209m, including 1m at 17.85g/t gold from 212m; and

15m at 4.71g/t gold from 223m, including 3m at 8.55g/t gold from 223m, including 1m at 37.1g/t gold from 235m.

TRC158
12m at 2.23g/t gold from 195m;

13m at 1.61g/t gold from 217m; and

23m at 1.54g/t gold from 246m.

“De Grey continues to successfully establish strong shallow gold mineralisation at Toweranna,” De Grey Mining technical director Andy Beckwith said in the company’s announcement to the Australian Securities Exchange.

“Toweranna continues to open our eyes to this new style of gold mineralisation.

“We don’t know how big Toweranna can be just yet as it remains open and is only constrained by the limit of drilling.

“This next phase of deeper scout diamond drilling will give us an indication of the resource potential between 200 to 600 metres depth.”

 

Email: admin@degreymining.com.au

Website: www.degreymining.com.au

 

ioneer Produces Battery-Grade Lithium Hydroxide

THE BOURSE WHISPERER: ioneer Ltd (ASX: INR) has had battery-grade lithium hydroxide produced using standard commercial processes on ore from the company’s Rhyolite Ridge lithium-boron project in Nevada, USA.

ioneer said the testwork had been carried out by Veolia Water Technologies Inc. as part of the Rhyolite Ridge DFS.

Veolia is the world’s largest supplier of evaporator and crystalliser systems and is globally regarded for its processing expertise.

Veolia’s benchscale testwork simulated major unit operations within the DFS process flowsheet and produced: boric acid and lithium carbonate; and high-purity (battery grade) lithium hydroxide.

“Veolia has a strong track record in designing and supplying production processes for the lithium industry,” ioneer managing director Bernard Rowe dais in the company’s announcement to the Australian Securities Exchange.

“By simulating major unit operations of the Rhyolite Ridge process flowsheet, Veolia has successfully validated the commercial process and confirmed key flowsheet parameters being finalised in the Rhyolite Ridge DFS.

“This gives us confidence that our commercial process is both straightforward and scalable.

“Using the technical-grade lithium carbonate produced from Rhyolite Ridge DFS flowsheet, Veolia has successfully completed bench-scale testing to support the commercial application for crystallising battery-grade lithium hydroxide.

“The testwork confirms that Rhyolite Ridge will be able to produce a range of products at the mine site including boric acid, lithium carbonate and lithium hydroxide.

“ioneer is well placed to meet the expected strong North American demand for lithium as the United States looks to develop a domestic battery supply chain.”

 

Website: www.ioneer.com

 

Helix Resources Reports Interim Collerina Resource

THE DRILL SERGEANT: Helix Resources (ASX: HLX) posted an interim maiden Indicated and Inferred Mineral Resource estimate for the Central Zone portion of the company’s Collerina copper deposit in the Cobar Region of Central New South Wales.

Helix Resources believes the high-grade copper from near surface at Collerina provides scope for potentially advantageous development optionality with the project being well located in a region with increasing development and exploration activity.

The interim Indicated and Inferred Mineral Resource estimate is 2.02 million tonnes grading 2.03 per cent copper, 0.1 grams per tonne gold and includes a high-grade massive sulphide component of 1.4 million tonnes grading 2.6 per cent copper, 0.2g/t gold.

The company explained this Resource announcement was delayed from earlier expectations due to the undertaking of a reinterpretation of the mineral system’s localised geometry, particularly in the deeper parts of the system, and with several delays in drilling.

The company considers the new interpretation will be a critical part in the planning for future drilling to expand on the Resource estimate.

The review established a robust and refined interpretation of the broader Collerina copper system and provided clear vectors to expand the known copper mineralisation envelope, well beyond the current drill pattern.

“The interim resource modelling process has substantially improved our overall understanding of the controls on the distribution of copper at the Collerina deposit,” Helix Resources managing director Mick Wilson said in the company’s announcement to the Australian Securities Exchange.

“Due to the drill density so far, only a modest portion of the Collerina system can be converted to JORC 2012 compliant resources at this stage.

“However, the low discovery costs to date and near-surface high grade copper reporting in the fresh portion of the Central Zone Plunge underpin the projects emerging value.

“Drilling in adjacent target areas, particularly up and down dip of the Central Zone Plunge are clear priorities.

“Our confidence in the refined geological shape and understanding of the structural controls on copper distribution and enrichment, with further drilling, we expect to see significant portions of the surrounding Exploration Target shape included in a deposit scale resource estimate.”

 

Email: helix@helix.net.au

Website: www.helix.net.au