31/07/2023

Metals One (MET1), which is advancing battery metal projects at brownfield sites in Finland and Norway, announced the admission of its entire issued share capital at 8.00 a.m. today. Admission follows a placing by Shard Capital Partners LLP and SI Capital Limited, as well as a company Subscription, for a combined total of 44,000,000 Ordinary Shares at 5p per Ordinary Share, raising gross proceeds of £2.2 million. The company said Metals One has listed with interests in nickel projects with substantial exploration carry exposure through farm-ins at a critical time for battery metals driven by the continued rise in electric vehicle adoption globally. With European brownfield projects, experienced partners, and funded work programmes in place, its projects are well positioned for rapid advancement as it seeks to establish ethically mined sources of critical minerals, including nickel, in Europe, close to future customers.

Comment: Any company that manages to raise the cash required for an IPO in current stock market conditions has to be both very determined and have a compelling investment case. In this case it is evident that MET1 achieved this with the help of the dream team combination of brokers – Shard and SI Capital. Metals One fits the fundamental bill as far as its position in the battery metals space, with the icing on the cake being the location of its assets close to key European car and industrial groups. Listing in a quiet time could provide a worthwhile  opportunity at around the placing price.

Premier African Minerals (PREM), provided a further update on the Zulu Lithium and Tantalum Project and the Offtake and Prepayment Agreement entered into between Premier and Canmax Technologies Co., Ltd. The company said it was deeply appreciative to its team at Premier and the team from Canmax for the work being undertaken in an effort to find a satisfactory outcome. In regard to Spodumene concentrate production, it is most encouraging to note that it is able to produce high grade spodumene concentrates from the plant material in our laboratory and to note that it expects to re-float concentrates produced to date with the intention of having saleable material in the coming weeks.

Comment: Given the somewhat rocky ride for the company over the past couple of months, it can be seen that it is attempting to steady the ship. However, once there has been a rug pull in much followed stock, it can take a while for nerves to settle and buyers to return.

Artemis (ARV) released a quarterly activities report for the period ending June 30 2023. Highlights included lithium bearing pegmatite identified by Joint Venture (JV) partner GreenTech Metals within the Osborne JV (GRE: 51%, ARV 49%) with high tenor rock samples assaying up to 3.6% Li2O. At Greater Carlow anomalous lithium and lithium pathfinder element trends identified within tenements E47/1746 and E47/1797 (ARV: 100%). ARV said it was evaluating all options to de-risk the Paterson Central project including third party funding options and or joint venture.

Comment: There would appear to be a disconnect between the bear market in ARV stock, and what the company is achieving on the ground. Today’s RNS could help inspire confidence.

Capital Metals (CMET), a mineral sands company approaching mine, updated on the company’s response to the temporary suspension of Industrial Mining Licences 16236 and 16237 and on Project development activities. The company said it believes the net is closing in on the small number of individuals within the GSMB and Government who are frankly out of control and whom we believe are seeking to illegally hand the company’s rights to favoured third parties. It is continuing its efforts to accelerate that outcome while simultaneously protecting the interests of shareholders through local writs and international arbitration. It is pleased that in parallel with these actions, we are now advancing development activities with the commissioning of the EIA which will lead to applications for industrial mining licences at EL199 in the southern area of the Project, which holds the majority of the total mineral sands resource of the Project and is not subject to the illegal activities of the GSMB.

Comment: CMET’s experience in Sri Lanka underlines the issues associated with jurisdiction risk across the board. However, it is unfortunate for the company that the individuals who are not playing ball regarding the company’s rights, are quite happy to shoot the interests of their country down. Ideally, the situation will be resolved resulting in the share price of CMET rebounding to where it was back in May at 4.5p, something which is certainly not factored into the current valuation of the company.

Aura Energy (AURA) provided an overview of activities for the period ended 30 June 2023 to accompany the Appendix 5B. Aura said it remains focused on fast-tracking the development of its Tiris Uranium Project in Mauritania and the advancement of the Häggån Polymetallic Project in Sweden. The forecast net operating cashflow, and the investment in exploration and evaluation for the coming Quarter is A$3.06m. With a closing cash balance of $11.27m, the company has sufficient working capital for 3.68 Quarters.

Comment: It is not often that you read that a company has enough cash for 3.68 quarters. But at least it does have a decent financial runway, and of course, net operating cashflow, something which puts it well placed relative to many of its peers.

Atlantic Lithium (ALL), the African-focused lithium exploration and development company targeting to deliver Ghana’s first lithium mine, presented its Quarterly Activities and Cash Flow Report for the period ended 30 June 2023. The company said over a 12-year mine life, the DFS indicates the production of 3.6Mt spodumene concentrate, delivering free cash flow of $2.4bn from $6.6bn Life of Mine revenues, a post-tax NPV8 of US$1.5bn and an Internal Rate of Return of 105%. Ewoyaa benefits from exceptional fundamentals, including adjacent infrastructure and the support of its surrounding host communities, which underlie its confidence in the delivery of the Project.

Tertiary Minerals (TYM) advised that the necessary permissions have now been received from the Forest Department in Zambia to carry out the company’s proposed soil sampling programmes in the forest areas within the Mukai and Mushima North project licences. The company said its objective is to now complete soil sampling over the exciting targets it has developed at Mushima North and Mukai as well as at its Konkola West Project. This will enable it to prioritise our Zambian Projects for follow up drilling having already completed similar programmes at its Lubuila and Jacks Projects.

Comment: TYM’s share price has certainly been in need of a boost, and it would appear that the latest news from Zambia may be the chance for bottom fishers to finally enter the fray.

Touchstone Exploration (TXP) provided an update on the construction of the Cascadura facility and Royston-1X production testing. Touchstone has an 80 percent operating working interest in the Cascadura field and the Royston-1X well, which is located on the Ortoire block onshore in the Republic of Trinidad and Tobago. Heritage Petroleum Company Limited holds the remaining 20 percent working interest. The company said it was working diligently to complete the commissioning of the facility and it is eager to commence first production.

Comment: Although many in the market have yet to cotton onto the progress here at TXP, the shares have gradually been gathering momentum, a process which should continue in the wake of today’s RNS.