Today’s Market View – Greatland Gold; IronRidge Resources: Oriole Resources; Pan African Resources:

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SP Angel . Morning View . Tuesday 15 12 20


China economic data shows strong recovery




MiFID II exempt information – see disclaimer below


Greatland Gold (AIM:GGP) – New CEO appointed after initial resource estimate delivered at Havieron


IronRidge Resources* (AIM:IRR) – Further Phase-3 drill results confirm gold mineralisation at Zaranou


Oriole Resources (LON:ORR) — Exploration in Cameroon extends known area of gold mineralisation


Pan African Resources (AIM:PAF) – Solar power project for Evander Mines


Power Metal Resources* (AIM:POW) – Ultramafic rock intercepted at Molopo Farms Complex, Botswana


Resolute Mining (LON:RSG) – Bibiani sale for US$105m in cash


Trans-Siberian Gold (AIM:TSG) – 2020 production range guidance increased to 44-45koz




Asteroid mining on the Ryugu asteroid reveals organic matter in samples returned to Earth


The Japanese venture to mine samples on the Ryugu asteroid, 300m km from earth has resulted in a greater than expected haul of rock chips than expected.


Scientists were apparently speechless when at the recovery with some samples reported to be several millimetres across.


The Hayabusa-2 space probe will now journey further on to target another two asteroids in an extended mission.


The mission takes the recovery of rock chips for metallurgical sampling from remote locations to a new level




China’s steel industry body demands explanation from BHP over soaring iron ore prices


The China Iron & Steel Association has shared its frustrations over surging iron ore prices with top producer BHP, suggesting that Rio Tinto and BHP have in some way manipulated the price through what they are calling “possible violations of laws and regulations”.


The CISA held a video conference with BHP executives in which there was a “candid exchange of views” on the miner’s production, sales and pricing, according to a statement from the industry group (South China Morning Post).


China is reliant on imports for 90% of its iron ore, which has saved the steelmaking ingredient from restrictions imposed by Beijing on other Australian imports including coal, wine and barley.




Economics


US – The size of the bipartisan fiscal aid package was reduced to $748bn aiming to secure approval in the coming days.


The drop from the previously envisaged amount of $908bn is led by an exclusion of two highly contested provisions including liability protections for businesses and assistance for states and local governments.




China – Economic recovery accelerated in November with YTD growth numbers for industrial production, retail sales and FAIs all up.


Strong growth momentum towards the end of the year reinforces expectations of healthy growth in 2021, Bloomberg reports.


The data comes in sharp contrast to other major nations, many of which are now re-imposing virus restrictions amid new wave of infections.


Industrial Production (%YTD): 2.3 v 1.8 in October and 2.3 est.


Retail Sales (%YTD): -4.8 v -5.9 in October and -4.9 est.


Fixed Assets Investments (%YTD): 2.6 v 1.8 in October and 2.6 est.


China – press reports highlights China’s use of coerced labour for cotton picking


Human rights activists have highlighted China’s use of labour from extrajudicial internment camps for cotton picking and likely other work


The bigger issue here is the imprisonment of over 1m people, particularly Uighurs, in extrajudicial internment camps which are purported to offer vocational training to counter extremism


Consumers may shun Chinese manufactured goods if consumer more products are shown to be made with interned labour.


While China claims to have lifted more than 800m people out of poverty it is struggling to develop a middle class.


President Xi pledged to eradicate poverty in China with some 850m lifted out of extreme poverty un under 40 years.


China’s new Dual Circulation policy may help to develop a new middle-class with significant consequences for global consumption of goods and services.


Demand has taken off for domestic appliances as China incentivises buying in certain regions alongside stimulus for property purchases and development.




UK – Sterling climbs as much as 1.7% on Monday as Boris Johnson and Ursula von der Leyen agree to go “extra mile” on post-Brexit deal


The pound posted its biggest gain in almost two months after the UK and the EU agreed to continue negotiating on a trade deal.


The yield on 30-year gov bonds climbed as much as 10 bps to 0.82% as the curve steepened- while shares of UK lenders and homebuilders were among the biggest gainers in Europe (Bloomberg).


The EU’s chief negotiator Michel Barnier told a private meeting of ambassadors that a trade deal with the UK could be completed as soon as this week.


Employment fell 370k with the jobless rate increasing to 4.9% in three months to October as employers cut stuff amid uncertainty over the status of the furlough scheme.


The number of redundancies over the three months period was the highest recorded in data going back to 2005.


Chancellor had ultimately to extend the furlough support programme on the eve of its expiry.


Reflecting the effect of the dismal year, annual fall in employment was the strongest in a decade with the number of people in paid work down 280k at 32.5m.


New strain of Coronavirus identified in the UK


There is no clear evidence that he the new strain is able to spread more easily or if it is more or less dangerous than other strains.


Experts appear to believe the current vaccines should also be effective against this variant strain .


To highlight how dangerous COVID is, a White House official who fell ill with Covid-19 in September is only now recovering after three months in hospital having lost his right foot and lower leg in the illness.


Craig Bailey will require significant rehab before he is able to go home.




Turkey – The nation will impose a four-day nationwide curfew over New Year holiday in an attempt to slowdown the spread of the coronavirus.


The lockdown will last from 9pm December 31 to January 4.


“Our hospital load is still very high… we will see the impact of restrictions more evidently soon,” Health Minister said.




Italy – The government is considering a nationwide “red-zone” during Christmas and New Year’s Eve banning all non-essential travel and closing down non-essential shops.


The nation recorded 491 new COVID-related deaths on Monday, up from 484 on Sunday, after surpassing the UK as the country with the highest death toll in Europe.


The decision might come after reports of crowds of people going out in Italy’s main city centers over the weekend, following a partial easing of restrictions in some Italian regions.




Netherlands and Czech Republic will follow Germany and go into a strict lockdown over the holiday period, Guardian reports.


Dutch PM said the nation will implement new restrictions for five weeks until January 19 as partial measures so far failed to arrest an increase in infections.


Non-essential shops and businesses, gyms, museums, cinemas and theatres will be closed now with bars and restaurants remaining closed since mid-October.


In Czech Republic, new measures will come into force this Friday with restaurants, hotels and indoor sports venues to be closed down.


Public gatherings will be limited to six people indoors and out, instead of current 10 and 50, with a nationwide curfew from 11pm until 5am.




Currencies


US$1.2140/eur vs 1.2153/eur yesterday. Yen 104.08/$ vs 103.90/$. SAr 15.019/$ vs 15.002/$. $1.332/gbp vs $1.340/gbp. 0.752/aud vs 0.756/aud. CNY 6.546/$ vs 6.537/$.




Commodity News


Precious metals:


Gold US$1,843/oz vs US$1,830/oz yesterday


Gold ETFs 106.6moz vs US$106.7moz yesterday


Platinum US$1,015/oz vs US$1,020/oz yesterday


Palladium US$2,322/oz vs US$2,331/oz yesterday


Silver US$24.21/oz vs US$24.85/oz yesterday




Base metals:


Copper US$ 7,773/t vs US$7,785/t yesterday


Aluminium US$ 2,040/t vs US$2,043/t yesterday


Nickel US$ 17,745/t vs US$17,550/t yesterday –


Shanghai nickel prices surge 4.7% on Monday as VNC situation deteriorates


A fire broke out at nickel mining facilities owned by Vale in New Caledonia on Monday, as the Brazilian miner attempts to sell the asset.


The foreign owned mine and its potential sale of other foreign companies has become a target of intense protests from pro-independence groups in the French territory (Reuters).


Nickel also rose on the LME, leading the complex of base metals to close 1.7% higher on Monday (Fastmarkets MB).


Zinc US$ 2,845/t vs US$2,816/t yesterday


Lead US$ 2,015/t vs US$2,072/t yesterday


Tin US$ 19,700/t vs US$19,555/t yesterday




Energy:


Oil US$50.0/bbl vs US$50.7/bbl yesterday


Oil prices remain fairly volatile yet above the US$50/bbl Brent threshold as concerns about oversupply battled with positive sentiment on vaccine roll outs and hope of a return of demand


Brent crude finished up slightly at $50.29/bbl at the close of yesterday’s session as positive vaccine news overpowered negative sentiment on inventory builds and tightening of lockdown restrictions


Libyan oil production has increased from 1.25MMbopd in late November to 1.28MMbopd according to a National Oil Corporation source


Widespread lockdowns in Europe have begun to curtailing demand which had showed signs of bouncing back, London is set to join many other areas of the UK under tier 3 restrictions while, France plans to delay easing of its restrictions and Germany looks set to tighten measures


The Netherlands has moved into its strictest lockdown since the pandemic began and Turkey has announced a 4-day lockdown over New Year


The US began its vaccine rollout on Monday starting as healthcare workers began receiving the Pfizer vaccine


The US follows the UK which began rolling out the Pfizer vaccine last week and Canada which has begun its rollout


Vaccination improves the medium-term demand outlook with hopes of a return to normalized demand in H2’21


20m doses are expected to be administered in the US by Christmas with 100m vaccinated by March


A blast in the Saudi port of Jeddah is being reported as a terrorist incident after an oil tanker was hit which led to a fire


The port has been closed while the incident is investigated


OPEC has postponed it Joint Technical Committee and Ministerial Monitoring Committee meetings until Jan 3 and 4


The group has also revealed its expectations of a slower demand recovery than originally expected, lowering its forecasts by 350,000bopd for 2021


The group cited persistent impact of the pandemic as the reason for this more bearish stance but did say a rapid roll-out of vaccines in major economies would provide upside to these estimates


Expectations are for an increase in inventories from the API later today and the EIA tomorrow


Analysts expect the data to show inventories increasing by 1.6MMbbls and for distillate inventories to be up by 400,000bbls


US shale output is expected to decline by 136,000bopd in January to 7.44MMbopd according to the EIA


Natural Gas US$2.658/mmbtu vs US$2.679/mmbtu yesterday


Natural gas prices edged higher in New York on expectations of colder temperatures than initially expected over the next 2 weeks in the US and record LNG exports


Output from the lower 48 US states averaged 90.8Bcf/day so far in December


Prices in Asia continue to move higher, congestion in the Panama Canal, supply outages and colder weather forecast for China, Japan and South Korea has seen the JKM move above US$8.075/mmbtu


Demand in Asia is helping to support prices in Europe as supply gets redirected. European storage drew by 146Bcf last week, above average for this time of year (108Bcf)


Uranium US$30.00/lb vs US$29.75/lb yesterday




Bulk:


Iron ore 62% Fe spot (cfr Tianjin) US$151.1/t vs US$158.0/t


Chinese steel rebar 25mm US$622.8/t vs US$626.0/t – China November steel output rises 10.8% YoY


China produced 117.34mt of steel products last month, up 10.8% on the year and 2.3% higher than the month prior, according to the NBS.


Over Jan-Nov, China’s finished steel production amounted to 1.2bt- up 7% on the same period last year.


China’s robust steel output has driven iron ore, nickel and zinc prices to fresh highs over recent months, while blast-furnace utilization rates remain over 90%- indicating steel mills have no plans to curtail production in the short-term.


Thermal coal (1st year forward cif ARA) US$67.0/t vs US$64.9/t – UK likely to bring forward ban coal fired power generation by a year to 1st Oct 2024.


The proposal is part of the government’s drive to speed up decarbonisation of the power sector and reach a net zero economy by 2050.


Coal’s share of electricity generation has fallen from 39% in 2012 to less than 3% in 2019.


Coking coal swap Australia FOB US$124.3/t vs US$124.3/t




Other:


Cobalt LME 3m US$32,000/t vs US$32,000/t


NdPr Rare Earth Oxide (China) US$61,795/t vs US$61,877/t


Lithium carbonate 99% (China) US$6,722/t vs US$6,654/t


Ferro Vanadium 80% FOB (China) US$27.5/kg vs US$27.5/kg


Ferro-Manganese high carbon 78% Mn US$1,325/t vs US$1,320/t


Tungsten APT European US$220-230/mtu vs US$220-225/mtu


Graphite flake 94% C, -100 mesh, fob China US$510/t vs US$510/t


Graphite spherical 99.95% C, 15 microns, fob China US$2,475/t vs US$2,475/t


Spodumene 6% Li2O min, cif (China) US$380/t vs US$375/t




Battery News


New solar energy storage


Researchers from Lancaster University have invented a new way to store energy from the sun for months at a time, with the option of releasing it on demand in the form of heat.


They have developed a “metal organic framework” that consists of metal ions webbed together into three dimensional structures.


Molecules loaded into the pores of these frameworks can absorb UV light and can change their shape when light or heat is applied.


These molecules can remain trapped at room temperature until external heat is applied to switch their state.




UK – will need to spend $20bn on four EV battery gigafactories (Benchmark Minerals)




CATL signs deal with PT Aneka Tambang for nickel as part of $5bn investment in lithium battery plant in Indonesia with production scheduled for 2024


The agreement requires 60% of nickel to be processed for batteries in Indonesia (Reuters).


Tesla executives are also due to visit Indonesia next month to discuss potential investment in a supply chain for its electric vehicles. This is likely to include nickel and cobalt.




Last Mile Solutions is to go public via a reverse merger with Forum Merger III Corp in $1.4bn deal.


Gross proceeds from the deal are expected to $379m, $155m from private investors including BNP Paribas Asset Management. The deal is expected to close in Q1.


Batteries for the small Class 1 delivery vans the Company plans to launch in Q3’21 will be made by CATL which provides LFP cells for urban delivery vehicles.


The urban delivery vehicles will have a range of 150-200 miles and a battery capacities of 42kW-60kW. The Company plans to release a third vehicle in 2022 with a battery capacity of 60-90kW and a range of 175-200 miles.




Baidu considers entering the EV race and is reported to have in contact with Geely Group, Guangzhou Auto, and China FAW Group for potential JVs.


Chinese search giant Baidu is considering making its own EVs according to sources on the matter (Channel News Asia).


The Company is said to be considering contract manufacture or a majority-owned venture with automakers and is already involved in autonomous driving and internet connectivity infrastructure.




Alternative fuels for military aircrafts


The Ministry of Defence has said that up to 50% of conventional fuel currently used by military aircrafts can be replaced with sustainable sources.


These sources are known as ‘drop ins’ and include hydrogenated fats and oils, food waste, alcohols, sugars, household waste, biomass and algae.


Aviation currently accounts for two thirds of fuel used across defence. It is estimated that by substituting 30% of conventional fuel with an alternative source, a jet travelling 1000 nautical miles could reduce its CO2 emissions by 18%.


The military are also said to be switching to electric vehicles as it is easier to refuel a vehicle in the field with electricity than maintain diesel fuel lines




Company News


Greatland Gold (AIM:GGP) 32.13p, Mkt Cap GBP1,259m – New CEO appointed after initial resource estimate delivered at Havieron


Greatland Gold has announced that the appointment of a chartered accountant, Shaun Day, to succeed the incumbent, Gervaise Heddle as CEO. Mr. Heddle is reported to be “leaving the Company to pursue other interests.”


Mr. Day is reported to have “over 20 years of experience in executive and financial positions across mining and infrastructure, investment banking and international accounting firms” including roles as CFO at Northern Star Resources and joins Greatland Gold from AIM and ASX-listed Salt Lake Potash.


Greatland Gold recently announced an initial, inferred mineral resource estimate for its Havieron project in the Paterson Region of Western Australia of 52mt at an average grade of 2.0g/t gold (3.4moz) and 0.31% copper.


The resource estimate consists of 18mt at an average grade of 3.8g/t gold (2.2m0z) and 0.61% copper within the Crescent Zone plus an additional 34mt at an average grade of 1.1g/t gold (1.2moz) and 0.15% copper in the adjacent Breccia Zone.


The estimate is based on the results of 125 drill-holes totalling 126,643m and is reported within a cut-off defined by the A$50/t NSR envelope at assumed metal prices of US$1,400/oz for gold and US$3.40/lb for copper (approximately US$7,500/t).


The company reminds us that “Mineralisation has been intersected in drilling at depths greater than 1000m … [and that it’s drilling has, so far has] … outlined an ovoid shaped zone of variable brecciation, alteration and sulphide mineralisation with dimensions of approximately 650m x 350m trending in a north west orientation below 420m of Permian cover”.


The company explains that there is additional potential to expand the initial resource as “mineralisation remains open within four target regions identified: South East Crescent and Breccia Zone, North West Crescent, Northern Breccia, and the Eastern Breccia.”


Drilling during 2021 is expected to “focus on the extension and definition of the South Eastern Crescent and Breccia, North West Crescent, Northern Breccia and Eastern Breccia zones adjacent to the current Inferred Resource … [while] … Infill drilling is underway on the top 350 vertical metres of the South Eastern Crescent within the existing resource outline with the aim to define Indicated resources to underpin the proposed Pre-Feasibility Study”. The Pre-Feasibility Study “is expected to be delivered by late 2021”.


Newcrest Mining is earning a 70% interest in the project though delivery of the pre-feasibility study.


Conclusion: The new CEO is taking over following the publication of an initial mineral resources estimate for Havieron which outlines a resource of 52mt at a gold equivalent grade of 2.5g/t. Additional targets within the lease area offer scope for meaningful resource expansion as exploration proceeds and the project advances towards a pre-feasibility study in late 2021. The depth of the mineralisation beneath significant post-mineralisation cover will require bulk underground mining techniques which should benefit from Newcrest Mining’s expertise and resources.




IronRidge Resources* (AIM:IRR) 12.8p, Mkt cap GBP52.7m – Further Phase-3 drill results confirm gold mineralisation at Zaranou


IronRidge’s latest drill results at its Zaranou Project, Cote d’Ivoire has produced initial high-grade and broad low-grade drilling results at its Ehuasso target, with the latest set of results confirming mineralisation over 1.7km along strike which is open at depth.


The Phase-3 programme consists of 50,000m combined AC and RC drilling at Zaranou, with approximately 30,000m drilled to date from three active drill rigs, and drilling expected to be completed in early Q1 2021.


Ongoing RC and AC drilling results for 4m composites over the two targets include highlights reported at a 0.1g/t cut-off and a maximum 4m of internal dilution:


ZARC0075: 20m at 2.64g/t from 60m including 4m at 12.44g/t


ZARC0067: 16m at 2.73g/t from 72m including 4m at 1.9g/t, 4m at 4.5g/t and 4m at 3.9g/t


ZARC0065: 23m at 1.33g/t from 192m including 4m at 1.9g/t, 4m at 1.6g/t and 4m at 4.4g/t


ZARC0059: 8m at 3.11g/t from 208m including 4m at 5.9g/t


ZARC0075: 12m at 1.91g/t from 188m including 4m at 1.5g/t and 4m at 4g/t


ZARC0068: 8m at 2.22g/t from 112m including 4m at 3.8g/t


ZARC0069: 28m at 0.59g/t from 144m including 4m at 3.5g/t


ZARC0036: 16m at 1g/t from 28m including 4m at 2.7g/t


ZARC0069: 12m at 1.28g/t from 124m including 4m at 3.3g/t


Drilling results to date from Phase-1 and Phase-2 programmes have defined the 1.7km x 70m (apparent thickness) Ehuasso Main target, with the new results reported infilling the target to 80m spacing over the target, from 160m previously.


The Phase-3 programme has returned multiple high-grade and broad low-grade drill intersections at depth over the Ehuasso and Ebilassokro targets, with results to date confirm depth continuity of higher-grade structures into fresh material below the base of oxidation.


Vincent Mascolo, CEO of IronRidge, commented: “As previously announced, an RC rig has commenced drilling at the Yakasse target. We are currently awaiting assay results from the first holes. Our ‘early ounces’ strategy continues to target oxide gold mineralisation, with initial observations suggesting it continues to average depths of 50m and up to 90m, which we believe is indicative of simple mining and processing at low operational and capital costs.”


“With only 12km of the 47km of identified strike having been drill tested to date, an additional 8km strike of hard-rock artisanal workings and 27km of soil anomalies remain untested with the potential to deliver a pipeline of further discoveries along this considerable mineralised structure.”


*SP Angel act as Nomad to IronRidge Resources




Oriole Resources (LON:ORR) – 0.38p, Mkt cap GBP5.5m – Exploration in Cameroon extends known area of gold mineralisation


Oriole Resources reports that rock chip sampling and 1:2000 scale detailed mapping at its Bibemi gold exploration project in Cameroon has extended the known strike length of mineralisation by 3km to 8.3km with the identification of two new prospects at Lawa West and Lawa East extending the mineralised footprint towards the south-west.


Mineralisation is reported to remain open towards the southwest and Oriole Resources “plans to test the new Prospects with eight drill holes and, together with further three holes at Bakassi Zone 1, the planned maiden diamond drilling programme now stands at 28 holes for 3,080 metres (‘m’). The rig is now expected to arrive in Cameroon in late December 2020, following minor delays as a result of the impact of COVID-19 on the global shipping industry”.


Drilling is now expected to start in January with initial results expected late in Q1 2021 or into Q2.


Rock chip sampling undertaken as part of the mapping programme has shown best results of 11.68g/t gold over a vein width of 0.6m at Lawa West and 22.38g/t over a vein width of approximately 3m at Lawa East.


CEO, Tim Livesey, commenting on the progress of the exploration said that “We are extremely encouraged by the discovery of further mineralised veins to the south west of the Bakassi zones” and added that the “recent identification of vein swarms at the new Prospects, supports the possibility of structurally controlled, higher volume areas of mineralisation, and we are pleased to have expanded the programme to enable testing of them”.


Oriole Resources also reports that “At the Wapouze project, 20km to the north, two short pilot trenches will commence shortly for a total of 200m, to test key anomalies identified during the 2019 soil sampling campaigns … Sampling and detailed mapping will be undertaken to help understand the spatial-temporal relation between lithologies, alteration and structures. Subject to results, it is possible that the drill rig could be moved to test targets at Wapouze following the programme at Bibemi”.


Conclusion: Extending the known mineralised area at Bibemi is prompting Oriole Resources to expand its forthcoming drilling programme to test the south-western extent of the mineralisation identified through mapping and rock-chip sampling. The early-stage rock-chip results show some high grades and we await the drilling to learn whether these early-stage results will be replicated.




Pan African Resources (AIM:PAF) 21.5, Mkt cap GBP415m – Solar power project for Evander Mines


Pan African Resources reports plans for a 9.975MW photovoltaic solar power plant at its Evander mines complex in South Africa.


Construction of the plant, which should provide around 30% of requirements, is expected to start during Q1 2021 and initial power is expected to become available during Q3 2021.


Capital investment for the plant, which is to be built by the international juwi Group, is expected to be 140m Rand and payback on the investment is “less than 5 years”.


In a separate announcement, Pan African Resources confirms that it expects to produce around 97,000oz of gold during the six months ending 31st December 2020 and that it remains “on track to meet its production guidance of approximately 190,000oz (2019: 179,457oz) for the 2021 financial year”.


The second announcement also confirms the retirement of its Chief Operating Officer, Andre van den Bergh with effect from 1st January 2021. In a record which few now entering the industry are likely to match over their careers, Mr. van den Bergh is “the Group’s longest serving employee, … [and] … rendered uninterrupted service for 46 years with Group companies”.


He is to be replaced as COO by mining engineer, Bert van den Berg, who joined Pan African in 2016 following some 14 years in the platinum mining industry.




Power Metal Resources* (AIM:POW) 2.1p, Mkt cap GBP18.5m – Ultramafic rock intercepted at Molopo Farms Complex, Botswana


Power Metal has continued to progress its Molopo Farms Complex Project, targeting massive nickel sulphide and PGM mineralisation in Botswana. The drill progamme is for an initial 2,505m across four diamond drill holes designed to intersect massive nickel sulphide mineralisation.


Drill hole KKME 1-6 is the second of a four-hole programme, and has been successfully completed to a depth of 547m- with ultramafic rocks intersected immediately beneath the Kalahari Group sediments at 27m and continue to the end of hole.


Drilling indicated a total down hole ultramafic intercept of approximately 520m, with primary core inspection indicating possible cyclic layering within the ultramafic zone.


Two shear zones were intercepted by the drilling at 501m and 515m, and the drill hole will now be surveyed with a downhole electromagnetic geophysics probe to determine whether the conductive target interpreted from geophysics surveys is related to these shears, or whether a conductive body could be located beyond the current end of hole.


Core from the drill hole will now undergo detailed geological logging- with core samples sent to lab for nickel and PGM assay.


The Company has signed agreements with Aster Funds (AFL) and Bell Geospace to progress surveying and processing techniques at site, to use alongside the existing airborne, AMT ground and downhole geophysical datasets with a view to accelerating and refining exploration targets.


AFL employ satellite-based Aster Thermal Imagery to provide target mapping through infra-red spectral analysis and electromagnetic conductivity analysis, with these systems aiming to complement existing geophysical datasets. The collaboration with Bell will facilitate the integration and analysis of the KKME airborne and ground geophysical data with Bell’s high-resolution Zeppelin airship-supporting gravity data collected over the three KKME Molopo Farms Complex licence areas.


Paul Johnson, CEO of Power Metal Commented: “We are pleased with progress at Molopo Farms Complex in Botswana where the second drill hole has intersected 520 metres of ultramafic rock. Results from the second drill hole continue to demonstrate the target geological model of an intrusive feeder zone which is a prospective setting for nickel and PGM mineralisation. We are also excited to report that Kalahari Key has signed collaboration agreements with two companies which are at the cutting-edge of remote sensing and data processing for exploration targeting.”


The project in question relates to the Kalahari Key Mineral Exploration Ltd, of which Power Metal has an 18.26% shareholding and elected to earn in to a 40% interest in the project by funding US$500,000 of exploration in 2020.


On completion of the earn-in, Power Metal will have an effective economic interest of 50.96% in the project, and the $500k cost is fully funded by the company’s existing cash resources.


*SP Angel act as Nomad and Broker to Power Metal Resources




Resolute Mining (LON:RSG) 42p, Mkt Cap GBP464m – Bibiani sale for US$105m in cash


The Company entered into a binding agreement with Chifeng Jilong Gold Mining over a sale of the Bibiani Gold Mine in Ghana.


Cash consideration will be payable in two tranches with US$5m to deposited on signing the agreement followed by US$100m on completion of the deal that is expected to close by March 2021.


Chifeng is an international gold mining company listed on the Shanghai Stock Exchange (US$4.3bn market capitalisation) operating five mines, including the world class Sepon gold mine in Laos.


Resolute acquired the mine in 2014 placing operations on care and maintenance launching a Feasibility Study looking at an option to develop long term and larger scale underground operation.


Updated FS was released in 2018 envisaging a 10 year mine life at ~100kozpa and $700-800/oz AISCs.


The mine is estimated to host 6.4mt at 3.3g/t for 660koz in Reserves and 21.7mt at 3.6g/t for 2,500koz in Total Resources.




Trans-Siberian Gold (TSG LN) 117p, Mkt Cap GBP102m – 2020 production range guidance increased to 44-45koz


The Company upgraded its 2020 production guidance to 44-45koz, up from 38-42koz expected previously.


The upgrade is led by higher processed grades as mining at the Asacha Gold Mine transitions to the East Zone.


This puts the Company on course for a record year in terms of gold output.


Gold production in the first 11 months of the year totalled 40.3koz






Analysts


John Meyer – [email protected] – 0203 470 0490


Simon Beardsmore – [email protected] – 0203 470 0484


Sergey Raevskiy –[email protected] – 0203 470 0474


Joe Rowbottom – [email protected] – 0203 470 0486




Sales


Richard Parlons –[email protected] – 0203 470 0472


Abigail Wayne – [email protected] – 0203 470 0534


Rob Rees – [email protected] – 0203 470 0535


Grant Barker – [email protected] – 0203 470 0471






SP Angel


Prince Frederick House


35-39 Maddox Street London


W1S 2PP




*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)


+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.




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Sources of commodity prices




Gold, Platinum, Palladium, Silver


– BGNL (Bloomberg Generic Composite rate, London)


Gold ETFs, Steel


– Bloomberg


Copper, Aluminium, Nickel, Zinc, Lead, Tin, Cobalt


– LME


Oil Brent


– ICE


Natural Gas, Uranium, Iron Ore


– NYMEX


Thermal Coal


– Bloomberg OTC Composite


Coking Coal


– SSY


RRE


– Steelhome


Lithium Carbonate, Ferro Vanadium, Antimony


– Asian Metal


Tungsten


– Metal Bulletin




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This note has been issued by SP Angel Corporate Finance LLP (‘SPA’) to promote its investment services. Neither the information nor the opinions expressed herein constitutes, or is to be construed as, an offer or invitation or other solicitation or recommendation to buy or sell investments. The information contained herein is based on sources which we believe to be reliable, but we do not represent that it is wholly accurate or complete. All opinions and estimates included in this report are subject to change without notice. It is not investment advice and does not take into account the investment objectives and policies, financial position or portfolio composition of any recipient. SPA is not responsible for any errors or omissions or for the results obtained from the use of such information. Where the subject of the research is a client company of SPA we may have shown a draft of the research (or parts of it) to the company prior to publication to check factual accuracy, soundness of assumptions etc.


Distribution of this note does not imply distribution of future notes covering the same issuers, companies or subject matter.


Where the investment is traded on AIM it should be noted that liquidity may be lower and price movements more volatile.


SPA, its partners, officers and/or employees may own or have positions in any investment(s) mentioned herein or related thereto and may, from time to time add to, or dispose of, any such investment(s).


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SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return of less than 15%



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