Drilling program going to plan on Alaskan North Slope

ASX:88E   Mar 18, 2022


88 Energy has updated the market on the drilling progress at its Merlin-2 well at Project Peregrine on the Alaskan North Slope.

Drilling this well was our key objective that we wanted to see 88E achieve in 2022, as outlined in our 2022 88E Investment Memo.

So far, the oil and gas junior has successfully drilled the Merlin-2 surface hole to 2,005 feet. 88E anticipates that all target zones will be intersected prior to reaching the permitted Total Depth (TD) of approximately 8,000 feet, which it expects to reach in two weeks time.

The company confirmed that operations are progressing as planned with the Arctic Fox rig scheduled to commence drilling ahead to the reservoir targets imminently.

Initial indications as to the prospectivity of the target zones at the Merlin-2 location will come from logging while drilling and mudlogging that’s being completed during the current drilling phase.

Further updates will be available after 88E reaches total depth, after which a sophisticated wireline logging program will be run, spanning a further 5-7 days.

As we mentioned in our Investment Memo, the reason that drilling Merlin-2 is our single key objective for 88E this year is that a discovery here would be a potential company maker, and put 88E on the radar of oil and gas majors in the area.

Keep in mind that 88E’s 652 million barrel prospective resource at Peregrine is analogues to the Willow Oil Field that is owned by Alaska’s leading oil producer, ConocoPhillips.

Drilling was completed at Merlin-1 in April 2021, demonstrating the presence of oil in multiple targets in the Nanushuk Formation. The Merlin-2 well was designed to appraise primary targets that were encountered in Merlin-1.

While the placement of the Merlin-1 well was suboptimal with respect to reservoir development, it is anticipated that Merlin-2 will reveal thicker and higher porosity/permeability formations.

There is a lot riding on the results here, plus they will help us determine what we want to see the company deliver for the rest of the year.

More assays from WA nickel project

ASX:ARN   Mar 18, 2022


Today, ARN announced that it had received assays from two diamond drill holes at the VC1 target that we wrote about in our last note. Peak results from the two assays were as follows:

  • 0.55m @0.87% Nickel, 0.14% Copper and 0.06% Cobalt from 109.45m.
  • 1.5m @0.76% Nickel, 0.29% Copper and 0.06% Cobalt from 150.05m.

Overall, we don’t think these are spectacular results. But it is still a sign that there is nickel in and around the targets that ARN was focussing on with its last round of drilling.

ARN will be following up these drill results with EM surveys which will form the basis for the next round of drilling.

But we are more focussed on the assay results from ARN's recently completed rubidium/lithium drilling program — a precursor for what ARN hopes could be a maiden JORC resource.

We set these drilling results and a potential maiden JORC resource from its rubidium/lithium project as two of the three objectives we want to see from ARN in 2022. To see all of the objectives and why we continue to hold ARN in 2022, see our 2022 Investment Memo.

Project update

ASX:VUL   Mar 18, 2022


Today VUL provided an update on its Zero Carbon Lithium project in Germany.

The first point covered was around the development works of its Direct Lithium Extraction (DLE) demo plant. At this stage, ~80% of all of the equipment is ordered and off site prefabrication works have started. VUL is expecting the demo plant commissioning stage to begin in the middle of this year.

VUL also confirmed that its DLE pilot plant was still operating and showing lithium recovery rates averaging ~94-95%. Importantly, this is well above the recovery rates used in the 2021 Pre Feasibility Study (which was assuming 88-90% recovery rates). The change might not sound big but the incremental difference makes a huge difference to project economics.

VUL also announced that it had kicked off discussions with BNP Paribas who would be helping secure project financing after the completion of the definitive feasibility study (DFS) which VUL expects to be completed in the second half of 2022.

Overall today’s announcement directly speaks to our Objectives #1 and #2 for VUL, as per our 2022 Investment Memo, which can be viewed here.

In particular, we think that the lithium recovery rates are important and should feed through to improved project economics when that DFS is completed. The 2021 PFS which delivered a €2.25 billion NPV was estimated using a US$14,925 lithium hydroxide price, compared to current spot prices of ~US$78,000.

We think there's a strong chance that VUL puts together a DFS with improved project economics, and hope that this leads to eventual project financing to propel its Zero Carbon lithium project into the development stage.

Trading halt pending assay results

ASX:LNR   Mar 18, 2022


This morning we saw our rare earths exploration investment FNT enter a trading halt pending some assay results.

In our latest FNT note, we mentioned that after uncovering 12 “priority 1” EM targets, the FNT team was on site conducting some “ground-truthing”. This is basically having the team on-site collecting rock chip samples in and around the target areas, looking at outcroppings, and pinpointing exactly where they intend to drill.

This forms part of the target generation works, whereby a junior explorer pinpoints high priority EM targets, checks if there are interesting outcroppings/high grade rock chips in that area so as to rank them from highest to lowest priority ahead of drilling .

For FNT to enter a trading halt ahead of announcing assays from these rock chips, we suspect the team must have picked up some interesting results.

FNT’s rock chip sampling is another step towards the maiden drilling program expected in the upcoming quarter.

Next week could make for an interesting one for FNT, with the results due. We also note that the share price of next door neighbour Dreadnought Resources moved from ~2.5c to a high of ~6.2c off the back of its rock chip sampling results (adding ~$91M to Dreadnoughts market cap).

One reason that we invested in FNT was to see it drill its rare earths project next door to Hasting's rare earths project, which is due to come into production in 2023.

To see all of the reasons why we invested and what we want to see FNT achieve in 2022, click here to see our 2022 Investment Memo.

Share Purchase Plan completed, shares now trading

ASX:ALA   Mar 17, 2022


The shares from ALA’s Share Purchase Plan (SPP) were issued to investors yesterday. Approximately 58m shares were issued @3.8c, raising a total of ~$2m, and we expected the share price to naturally come back down towards the capital raise price.

After peaking at ~4.5c — which represents an almost 15% profit for those who took shares in the SPP — the share price closed down ~9%. But this is completely normal with some of the shareholders who took up the offer looking to sell out for a quick profit.

The share price might trade sideways in the short term as SPP investors look to sell out for the quick profits. The positive is that when those investors sell, the buyers of those shares help to form a new base for the company’s share price.

We expect that with a new base for ALA’s share price and progress on the key objectives (as set in our 2022 Investment Memo) will see the price move in line with the company’s progress, as opposed to general market dynamics.

Below is an image of the objectives we want ALA to achieve in 2022:

Drilling completed at WA rubidium/lithium project

ASX:ARN   Mar 17, 2022


Earlier in the week, ARN announced that its 65 hole RC drilling program had been completed at its Niobe rubidium/lithium project.

With the majority of the drill holes making pegmatite intercepts, all eyes will be on the assays which ARN will be looking to convert into a maiden JORC resource. In our last note on ARN’s drilling program we set the following expectations for the assays:

  • Excellent: Average rubidium grades at or above the 0.15% upper range ARN set for its exploration target, with the project also proving out a lithium resource at the same time.
  • Good: Average rubidium grades above 0.07% and some indication of lithium mineralisation.
  • Poor: Average grades <0.07% rubidium and no lithium mineralisation in the assays.

We set this based on the exploration target that ARN had set based on analysis of historic drilling results: 33,000-150,000 tonnes of rubidium oxide grades ranging from 0.07% to 0.15%. ‘

The drilling program and the announcement of a maiden JORC resource are two of the three primary objectives we set for ARN to achieve in 2022. To see these and why we continue to hold ARN in 2022 view the memo here.

Major shareholder Silver Mines sells $206k in shares on market

ASX:TMZ   Mar 17, 2022


TMZ has confirmed that its major shareholder Silver Mines had sold $206k in shares on market at 6c per share, leaving them with ~58.6m shares (9.98% of TMZ).

With such a large shareholding we would prefer to see Silver Mines exit via a block trade whereby someone buys their entire shareholding via one transaction as opposed to continuous selling pressure on market, which may put downward pressure on TMZ’s share price.

Generally, major shareholders who own >5% of a company will need to lodge any changes to their shareholdings within ~2 business days. With the first sale being made on the 11 March we will be watching to see if Silver Mines continue to slowly sell on market over the next few weeks.

In the meantime, TMZ is working on updating its mineral resource estimates across its deposits as it aims to reach the milestone combined 100 million ounce silver JORC resource.

The updated resource estimates are objective #1 in our 2022 Investment Memo for TMZ, to view the remaining two objectives we have set for the company in 2022 click here.

High purity alumina added to government's critical mineral list

ASX:FYI   Mar 17, 2022


Yesterday the Australian federal government updated its “critical minerals strategy” documents and added two new minerals to the list - silica and high purity alumina.

The list of now 26 critical minerals are made up of those that are needed to manufacture high tech devices, military applications and, importantly, those needed to aid the transition towards a low carbon economy.

High purity alumina has several different industrial applications from glass to LED lights, more recently however it is starting to be considered a “critical” mineral due to its use in high energy density batteries such as those used in electric vehicles.

Our battery metals investment FYI is aiming to be the first to market to deliver high purity alumina using a new kaolin clay based process that is cleaner, purer, and much less expensive than traditional methods of alumina production. It is doing this via a partnership with US$14 billion global alumina giant, Alcoa.

With ESG considerations becoming more and more important and high purity alumina now recognised as a “critical mineral” we expect the market to become more interested in FYI’s tech.

Fed to take “aggressive” stance on inflation, gold to move up?

Next Investors   Mar 17, 2022


The gold price is sitting at US$1933/oz after The Federal Reserve raised interest rates by .25% - the first rate hike in three years and Jerome Powell flagged that The Fed would keep raising rates until they hit between 1.75% and 2%.

Below is a chart of the gold price with some key levels:

As the crisis in Ukraine kicked off, gold punched as high as ~US$2075/oz but retraced and bounced off the US$1900/oz mark.

The interesting thing to note here is that historically, gold thrives in a rate tightening environment.

We’ve noticed some lag in our gold stocks - as in they’re not moving with the gold price. But we think that the lag period may be close to ending.

These are the gold stocks in our portfolio:

Los Ceros (ASX:LCL) - This is why we invested

  • Gold, Exploration Stage (Colombia)

Tempus Resources (ASX:TMR) - This is why we invested

  • Gold, Exploration Stage (Canada, Ecuador)

Titan Minerals (ASX:TTM) - This is why we invested

  • Gold, Exploration Stage (Ecuador)

Ragusa Minerals (ASX:RAS) - This is why we invested (Catalyst Hunter Portfolio)

  • Gold, Halloysite Exploration Stage WA (Australia and Alaska)

Critical mineral processing nabs $243M in government grants

ASX:LNR   Mar 17, 2022


Prime Minister Scott Morrison yesterday announced that the federal government has committed $243m in grant funding for the processing and refinement of critical minerals, as listed in Australia’s 2022 critical minerals strategy.

This is the first grant as part of the federal government's $1.3 billion Modern Manufacturing Initiative.

The $243m in grant funding will be split across four projects, including vanadium and rare earths.

Of the four projects that received funding, we were most interested in the $30M grant that Arafura Resources received for its rare earths (NdPr) project in the NT. Here the company plans to construct a “first of its kind” rare earth separation plant - only the second of such plant outside of China.

With the government stepping in and providing capital to develop a rare earths processing and refining industry in Australia, the future for local rare earths explorers and producers looks bright.

All of this affirms our macro thinking behind the latest addition to the Catalyst Hunter portfolio - Frontier Resources (ASX: FNT). FNT is preparing for a drilling program right next door to another Hastings technology metals “Yangibana project”, which is expected to come into production 2023 and has the highest grade resource of its peers in the rare earths space.

Interestingly, Hastings was also a recipient of a government loan of ~$140M which is being used to develop its project.

Click here to view our 2022 Investment Memo and see why we invested in FNT and what we want the company to achieve in the year ahead.

Helium offtake agreement locked in early

ASX:GGE   Mar 17, 2022


GGE yesterday announced that it has partnered with Paradox Resources to explore future opportunities together in the helium space.

Paradox is a major player in the North American premium helium market with advanced processing capability. It owns the Lisbon helium processing plant located 20 miles north of the GGE’s helium project.

GGE points to the gas sales and offtake agreement with Paradox as further validation of the technical merit of its pure-play Red Helium Project, where it is targeting a gross prospective resource of 10.9 bcf.

The signed drill contract and offtake agreement provide line of sight to monetisation on success GGE’s maiden helium well, Jesse#1 which is scheduled for spud next month.

The company notes that this deal comes at a time when helium, one of the world’s most critically scarce commodities, is needed most.

We provided our take on the deal in a Note to Wise-Owl readers yesterday: GGE gets helium offtake BEFORE drilling, and explain how it relates directly to the third objective in our Investment Memo (Progress commercialisation of the gas resource) that we want to see GGE achieve in 2022.

More spodumene intercepts at its Brazilian lithium project

ASX:LRS   Mar 16, 2022


Today, LRS announced that it has intersected more spodumene bearing pegmatites in both drillhole no 5 and 6.

In our last note we wrote that the results from drillhole four would start to prove out whether or not a spodumene structure is getting bigger across its project. Today LRS announced that in that particular hole LRS returned ~36m of cumulative pegmatite intercepts with one intercept alone measuring ~17m.

LRS also confirmed that both holes five and six also made pegmatite interceptions with hole six still ongoing.

All of this means LRS has now put together a ~500m section of its total ~1.5km strike zone, confirming spodumene bearing pegmatite intercepts across the entire 500m southern section of the prospective strike zone.

Finally, LRS confirmed that the assays from drill holes one and two are expected within the next few weeks.

If those assays confirm the presence of high grade lithium across the structure then we think LRS will be in a strong position to potentially tick off objective #1 in our 2022 Investment Memo of putting together a maiden JORC resource for its Brazilian lithium project.

Heritage surveys ongoing at the Hawkins zinc/lead project

ASX:BPM   Mar 16, 2022


Yesterday, BPM announced that heritage surveys had commenced across its Hawkins zinc/lead project in the Earaheedy basin in preparation for the 7,500-metre air core drilling program, scheduled for ~early April.

We are not expecting BPM to make a discovery with the air core drilling program but instead want to see the company throw up enough follow-up drill targets to warrant deeper RC/diamond drilling later in the year.

In our 2022 Investment Memo, we highlighted that the Hawkins project was the main reason we continue to hold BPM in our portfolio, With the project sitting ~40km away from Rumble Resources (capped at $269M) Chinook discovery.

It has been a long time coming for the Hawkins project but today’s announcement is the final step before BPM can start to tackle objective #1 from our 2022 Investment Memo and begin exploration works across the project.

Drilling permit granted for Skuterud Cobalt project

ASX:KNI   Mar 15, 2022


Yesterday, KNI announced that drilling permits had been granted for a 7-hole, 2,800m diamond drilling program at its Skuterud cobalt project.

The drilling program which is expected to commence in the first week of May will be targeting three high priority EM conductors that we have covered in our last two notes for KNI.

To read about the EM target we are most interested in check out our previous note here: KNI Geophysics Unveils EM Conductor Under Historic Cobalt Mine

With previous drilling missing the EM conductor we are hoping that the modern exploration technologies KNI have used can mean KNI can make a large scale cobalt discovery.

Trading halt “significant commercial agreement announcement"

ASX:GGE   Mar 15, 2022


Yesterday morning we also saw our 2021 Catalyst Hunter Pick of the Year GGE go into a trading halt pending an announcement regarding a commercial agreement.

In our 2022 Investment Memo our third objective for “what we want to see GGE achieve in 2022” was for it to commercialise its helium resource. GGE had mentioned to the market that it was in negotiations regarding some sort of offtake agreement but we didn’t think this would come until at least after the first well was drilled.

With the company now in a trading halt it looks like GGE may have managed to secure something before its drilling program targeted for mid-April.

The market usually responds well when a positive announcement is early or unexpected.

Of course a “commercial agreement” is still very vague so we will be watching to see what GGE announces on/before Wednesday this week.

Fraser Range Nickel exploration update

ASX:GAL   Mar 15, 2022


Yesterday morning GAL put out an update across all of the exploration work ongoing at its Fraser Range project.

The key takeaways for us from today’s announcement was:

  1. 940m of RC drilling has been completed so far across one prospect.
  2. EM surveys progressing across three prospects as part of target generation works for future drilling programs.

Todays announcement confirms to us that GAL is actively working towards delivering objectives #1 and #2 that we set in our 2022 Investment Memo as “what we wanted to see GAL achieve in 2022”.

With EM surveying ongoing across three different parts of its Fraser Range project and an RC drilling program running concurrently GAL is setting itself up for a busy year across its Fraser Range project.

One of the primary reasons we continue to hold GAL in our portfolio is because the company is busy all year round with exploration work which increases the probabilities that a discovery can be made, todays announcement is more confirmation of this.

Lithium projects applied for in the Northern Territory

ASX:RAS   Mar 15, 2022


Yesterday, RAS announced that it had successfully applied for three exploration licences prospective for lithium next door to Core Lithium (capped at $1.8 billion) in the Northern Territory, AUS.

The exploration licence applications sit next door to Core Lithium's Finnis hard rock lithium project which has a JORC resource of ~15 million tonnes (Mt) at 1.3% lithium oxide.

RAS’s grounds sit on similar geological structures which adds another project into the RAS stable with neurology to much bigger companies, although given the project is made up of exploration licence applications it is still far too early to tell what RAS has on its hands.

The acquisition sits outside of our 2022 Investment Memo which is focussed on RAS’s WA hallyosite project and its Alaskan gold project.

We will however be watching to see if the lithium project throws up any interesting exploration targets, and we are pretty happy with the concept given how hot the lithium market is and how well Core Lithium has performed.

MRE for Texas Silver District

ASX:TMZ   Mar 01, 2022


It’s a positive that TMZ got its Texas updated JORC 2012 MRE out on time for Texas.

It now means that TMZ has 40.2 Moz AgEq combined after the Conrad MRE which had 20.7 Moz AgEq.

We’re looking for the completion of the remaining MRE update for Webbs and we think TMZ may now need to drill to hit the 100Moz AgEq nark to do so.

That 100Moz AgEq threshold forms Key Objective #1 in our TMZ Investment Memo.

TMZ has flagged a geophysics program is advancing at Texas so we believe there could be some drilling upside to come there.

TMZ moves methodically, but it’s our view that this is necessary to advance Australia’s highest grade undeveloped silver resource.

The silver price got as high as US$25.60 an ounce on February 24.

Vonex half year results announced

ASX:VN8   Mar 01, 2022


Our telco investment Vonex is in the midst of an acquisition phase, having acquired four complementary businesses over the past 2 years. This has helped VN8 deliver a strong financial performance over the half-year ending 31 December 2021.

We liked that group revenue increased to $15m, up 54% year-on-year (YoY). Gross profit was also up significantly to $7.5m, up 174% YoY. Underlying EBITDA was up to $3.3m for the half year, versus $0.2m in H1 FY21.

The acquisitions have rapidly expanded VN8’s customer base, with PBX users now exceeding 90,000. This has led to a 104% growth in annual recurring revenue to $34.5M - which we think is quite sold for a company with a market capitalisation of ~ $32M.

The flip side to the acquisitions is that VN8 currently has a high level of net debt ($11.9M) - but given its strong cashflow, we expect most of the debt to be paid back this year. This will free up cash for further acquisitions and possible dividends down the track.

We’re keen to see VN8 continue to grow on several key financial and operating metrics in 2022, whilst fully integrating the most recent acquisitions into its business.

1,000m RC drilling program commenced in the Fraser Range

ASX:GAL   Feb 28, 2022


On Monday, GAL announced that it had started a 1,000m RC drilling program to test three new EM targets as well as re-test two targets in an area that was previously tested with shallow aircore drilling.

In its last round of drilling in ~2018, GAL hit 36 metres @ 0.2% nickel from 18m including a higher grade section of 3 metres @ 0.56 % nickel from 24m during a shallow aircore drilling program where the average depth in each hole was ~41m.

Rarely are nickel sulphide deposits found at that depth and with the nickel price trading at 10 year highs we think GAL is taking shots on goal at the right time in search of a large scale nickel discovery in the Fraser Range region.

Whilst we wait for the assays from ~8,700m aircore drilling program from its norseman project, we will be watching to see if GAL makes any visible sulphide intercepts from this RC drilling program.

Wyemandoo pegmatite rock chip samples

ASX:ARN   Feb 28, 2022


ARN announced today assay results from its last round of rock chip sampling at the Wyemandoo lithium/rubidium project.

Out of a total of 188 assays received by the company, ARN reported a peak result of 1.24% rubidium and in a separate assay a peak grade of 1.05% lithium.

This forms the basis for the geochemical sampling program ARN are using to define drill targets, which it will be following up as soon as the drill rigs are done at the companies Niobe project.

At the moment we are waiting on the assays from all of the pegmatite intercepts ARN has made whilst drilling Niobe.

Final Processed Seismic Data Received

ASX:IVZ   Feb 28, 2022


Today IVZ announced that the datasets from its 2021 2D seismic survey and the re-processing of the US$30M legacy dataset left over by Mobil had largely been received from the 2D seismic consultants.

Next, IVZ will continue with its internal interpretation of the datasets before ranking the anomalies picked up from most interesting to least, so as to finalise the locations for its drilling program now expected to be spud in June 2022.

In our 2022 investment memo we put the “detailed interpretation of seismic data” and final identification of the drilling locations as objective #1. Once this is out of the way, IVZ can shift its focus to the maiden drilling program.

2022 Drilling program kicks off

ASX:EXR   Feb 28, 2022


Today EXR announced that it had started drilling the first of a total 24 well drilling program planned for 2022.

The first of these wells sits right on the border of the tenements that make up the Oyu Tolgoi mine owned by Rio Tinto and will be drilled to a planned total depth of ~700m.

This year, we want to see EXR complete the pilot production program off the back of last year's drilling program.

EXR confirmed that the 2 well extended pilot production program was scheduled to commence around ~mid year. With gas becoming a talking point off the back of the Russia/Ukraine conflict we are eagerly waiting to see if EXR can confirm economic flow rates at its project.

$2.5M funding package + drilling program expanded to 5,000m

ASX:LRS   Feb 28, 2022


Today LRS announced a $2.5M financing package signed with Lind Asset Management over a 14 month loan term.

With fresh funding secured, LRS also announced that the 2,000m drilling program at its Lithium project in Brazil would be expanded to 5,000m with the ultimate aim of putting together a maiden JORC resource.

The terms of the funding facility are as follows:

  • $2.75M face value loan, repayable over a 14 month period.
  • LRS to issue Lind 35 million unlisted options with an exercise price of 5c, expiring March 2026.
  • LRS to pay Lind a $75k commitment fee.
  • Funds raised from “in the money” options being exercised must be used to repay the principal of the loan.

So in total over the 14 month loan term, LRS is paying $325k in loan fees and 35m in unlisted options exercisable @ 5c.

In our last note, where we covered LRS’ first spodumene intercept from its drilling program at its Brazilian lithium project, we mentioned we wanted to see LRS shore up its balance sheet so we welcome the news from Monday.

New products hit shelves at Coles

ASX:FOD   Feb 25, 2022


We noticed something new at our local Coles this week, FOD’s plant based protein smoothies had hit the shelves.

We bought both, and our key takeaway (from flavour point of view) is that these things are filling - essentially an entire breakfast / lunch replacement.

Banana was our favourite, but we did like the Raspberry & Chocolate one too.

If you’re invested in FOD, go down and try one for yourself and let us know what you think.

We are keeping an eye out for early sales/market share data from this new product, and how it will help improve FOD’s overall sales and financial performance.

AJX Half yearly results

ASX:AJX   Feb 25, 2022


On Friday, AJX announced that it had increased its revenues by ~46.3% with gross margins consistent with 2H FY21 and from the same period last year's results at 40.1%.

AJX showed a US$1.9M loss in its income statement, but the actual cash outflow was much lower at ~$900k and we note that with the addition of the new BioCoolTM products and new customers AJX had increased its inventories by US$600k.

Earnings call and preliminary annual report summary

ASX:ONE   Feb 25, 2022


ONE reaffirmed revenue guidance of €12.5 - €14m for 2022 - ONE remains one of our favourite investments and biggest positions.

Key metrics (with commentary):

  • 5% Recurring Revenue growth - slightly disappointing, but still time to make up ground
  • 37% Total Revenue growth (due to lumpy outlay of lower margin hardware sales) - this is reflected in non recurring revenue up 120% and cost of sales up 86%
  • 9,487 beds live at 31 December 2021 (+3%) vs 9,121 at 30 June
  • 2,355 beds contracted not yet installed.
  • 11,842 contracted beds - we want to see 15K contracted beds by the end of 2022

40% increase in sales and marketing - means ONE is spending 20% of receipts on sales and marketing so they did what they said they would do here, hopefully, they reap the rewards in the sales pipeline

We think the lag from hardware push should come through in coming quarters with recurring revenue, potentially in the 20-25% range.

ONE has 12,123 beds in RFP/RFI which are still waiting on decisions - these formal processes represent 64% of ONE’s total sales pipeline of 18,927 beds.

RFPs (Request for Proposal) and RFIs (Request for Information) are lengthy affairs that push ONE’s contracted beds through the bureaucratic pipeline.

It’s good to see so many beds potentially there for ONE, now we just want to see its sales and marketing team convert.

Massive nickel sulphides at the Saints nickel project

ASX:AOU   Feb 24, 2022


On Thursday AOU announced that it had made two massive sulphide intersections at its Saints nickel project.

The 7 hole diamond drilling program is mostly being done so that ARN can upgrade its 1.02mt @2% nickel JORC resource. The drilling is mostly infill so the intersection of massive sulphides was somewhat expected by the market.

We are more interested in the grades of the intercepts as opposed to the massive sulphide intercepts themselves, if the drilling was targeting a new discovery then we suspect the market would have reacted a lot differently.

With 3.01m in massive sulphides intersected in one hole and 0.84m in another, all eyes are now on the nickel grades that come back from the drilling program, before AOU can try upgrading the JORC resource.

CAY enters trading halt

ASX:CAY   Feb 24, 2022


On Monday, our latest investment CAY went into a trading halt with respect to permitting at its bauxite project.

We read this news piece on Saturday afternoon which showed that the two tenements (sitting outside of the area where CAY’s resource is) were under an MOU with a Chinese state owned entity.

The MOU listed that they would be handed as exploitation permits (earliest stage of permitting in Cameroon). Importantly the MOU was with the national mining company Sonamines and not issued by the Ministry of Mines.

It didn’t look great for CAY holders however 48 hours later, we read this news piece which showed the Ministry of Mines (the main regulatory body in Cameroon) had cancelled this MOU and said that permitting was a ministry duty and not up to the national mining company Sonamines.

This was swift action from the government who look to us like they were not consulted when that MOU was signed.

We will be watching to see updates CAY provides and hope that everything is resolved this week.

Drilling commenced at nickel targets

ASX:BPM   Feb 23, 2022


Last week we put out a note on BPM’s Nickel targets identified next door to our other portfolio company Auroch Minerals nickel project.

Today BPM announced that drilling had commenced across the 11 identified EM conductors. To read more about these 11 targets, read our last note here.

The 3,000m of Aircore drilling is expected to take a few weeks and we don't anticipate any assays coming in for at least another 4-6 weeks after that.

GGE Appoints Managing Director

ASX:GGE   Feb 23, 2022


Today GGE announced the appointment of Dane Lance as its managing director.

Lance is a senior oil and gas professional and reservoir engineer with over 16 years industry experience. He has a focus on “resource maturation and monetisation” - a perfect fit for GGE who will be drilling its maiden well at its helium project very soon.

Lance has worked for Woodside, Ophir (including technical evaluation of the ~$500m Ophir acquisition of Salamander) and Oil Search in previous roles.

We think the experience in monetising new discoveries is important especially given GGE’s project sits in an infrastructure rich area where new discoveries can quickly be brought to market.

KNI drilling program update

ASX:KNI   Feb 22, 2022


KNI announced today that the drilling program at its main cobalt target (Skuterud) is on track for Q2-2022.

With the applications for a drilling permit lodged and drilling contractor “Norse Diamond Drilling AS” awarded the contract, the 7-hole, 2,800 metre program appears to be on schedule.

KNI also announced that after further review of the geophysical and geochemical data the Vangrofta copper target wasn't of sufficient size to warrant further drilling.

This comes as KNI has spent the last 6 or so months refining the highest priority drill targets to allocate its funds to drill test in 2022.

EM surveys completed at newly acquired lead-silver project

ASX:PFE   Feb 21, 2022


On Monday PFE announced that it had completed EM surveys over the two main target areas at its newly acquired lead/silver project in WA.

The EM survey results are yet to be received but PFE is aiming to analyse the results and prepare a drilling program which is expected to commence in Q2-2022.

Read our deep dive into the newly acquired Hellcat asset, where we discuss why we like the project and where we compare it to Galena Minings' deposit that is currently being put into development.

RC drilling scheduled on Fraser Range EM targets

ASX:GAL   Feb 21, 2022


Today GAL announced that it had contracted 1,000m of RC drilling over some EM targets in the Fraser Range region.

Drilling is planned to commence later this month, and assays to start coming back from the labs in April-May 2022.


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