A whiff of rare earths at LRS’s Cloud Nine


Nov 03, 2022


Investment Memo: LRS-IM2

Our lithium development Investment, Latin Resources (ASX:LRS) also has a halloysite-kaolin project called Cloud Nine, which as of this morning, looks to also have rare earths potential.

It’s early days, but LRS did analysis on “a small random selection (one out of every 20) of existing <45 µm fraction samples collected from the recent infill drill programme” at the WA halloysite-kaolin project.

We like the results from this initial sampling program:

  • Anomalous rare earths concentrations in 38% of the samples
  • 3,617 ppm, 0.36% total rare earth oxide (TREO)
  • Of these TREO results average key magnetic rare earth oxides (MREO) of 21-28%, mainly Neodymium (Nd) and Praseodymium (Pr)

Nd and Pr are found in the permanent magnets in electric vehicles and wind turbines - two key planks of the energy transition.

This would be a clay hosted rare earths deposit which is amenable to extraction via weak acids or ionic solutions.

As a result, the threshold for economic clay hosted deposits is lower than other rare earths deposits - LRS says 500–2000 ppm TREO is suitable for clay hosted deposits.

LRS’s results came in well over the top of those parameters - so our initial take here is that this is a very promising development in a macro environment that favours rare earths discoveries due to increasingly prominent geopolitical factors.

What’s next for LRS? In addition to the upcoming mineral resource estimate at LRS’s Brazilian lithium project, we’re looking for LRS to analyse further samples and hopefully further down the track, update the resource estimate model at Cloud Nine to include these rare earths results.

Assay results from Hawkins lead-zinc project


Nov 03, 2022


Investment Memo: BPM IM-2022
Objective 1 : First Lead/Zinc drill holes in the Earaheedy Basin.
Milestone 4 : Drilling results
Risk 3 : Exploration risk

Yesterday, our exploration mining investment BPM Minerals (ASX:BPM) released the much anticipated results of the first drilling program at its Hawkins Lead-Zinc prospect.

This project, near to Rumble Resources lead-zinc discovery, was one of the key reasons why we invested in BPM.

BPM announced a top line result of 2m @0.25% Zn & 0.31% Pb.

Here is how our Bull/Bear/Base case looked for BPM:

  • Bull case = BPM proves there is enough potential to warrant follow up drilling works over the project.
  • Base case = Traces of lead-zinc mineralisation across the project area.
  • Bearish case = No mineralisation and no planned follow up drilling programs.

This drilling result falls between our Bear and Base case for BPM.

Although lead-zinc was discovered, the trace amounts were not of a high enough grade to be interesting - with a follow up drilling program ‘currently being assessed’.

We will provide a longer note on what these drilling results mean for BPM in the coming days/weeks.

Growing, growing…


Nov 02, 2022


Investment Memo: VN8 IM-2022
Objective 1 : Become cash-flow and EBIDTA positive in FY22.

Our telco Investment, Vonex (ASX:VN8) is rapidly increasing its revenue - the kind of top-line growth that may garner greater attention in the coming quarters.

We think this is the right approach for a small-cap telco like VN8 and is part of what we view as its core strategy:

VN8 posted the following numbers in its quarterly:

  • September quarter cash receipts of $10.5M up 48% Year on Year (YoY)
  • Annualised recurring revenue (ARR) of ~$51M at 27 October 2022, up >60% YoY
  • Operating Cash Inflows $1.6M
  • Cash balance of $4.7M

Annual Recurring Revenue (ARR) is a key figure that many tech companies look towards - and acquisitions are often based around the smoothed out cashflows that ARR represents.

Assuming customer stickiness levels are high - ARR is a good basis for understanding the future trajectory (and value) of companies like VN8.

Sustained operating cashflow quarters like in Monday’s quarterly release (+$1.6M) should help as well.

While VN8 has been caught up in a broader market move away from tech, we’re hopeful that as VN8 acquisitions start to get integrated and gel, these kind of numbers can take VN8 higher up the charts.

VN8 is using mostly debt to fund its acquisitions (Longreach financing), which we think is a sensible non-dilutive move given its track record of successfully integrating acquisitions and building more efficient operations out of combined entities.

We estimated that VN8 has $22.5M in debt via the Longreach financing facility which matures in December 2024.

In our eyes, this is a good chunk of time in which VN8 can grow not only its top line revenue but also move solidly into profitability.

In short: if/when the market sentiment towards tech turns, we like VN8’s prospects.

Next up for VN8 is to complete integration of its latest acquisition, OntheNet, which should further boost revenues and EBITDA going forward.

Vulcan to expand into France


Nov 02, 2022


Investment Memo: VUL IM-2022
Objective 3 : Expansion of scope

Our lithium Investment and 2020 Pick of the Year, Vulcan Energy Resources (ASX:VUL) is set to expand its business into France, a move which is being supported by significant shareholder and multinational carmaker, Stellantis.

We like this move, as it could significantly increase VUL’s footprint in the European battery metals market and allow for larger scale production down the track should all go well.

As part of the push into France, VUL has applied for its first lithium exploration licence in the Alsace region of France which can be seen below:

Previously, VUL’s brine sampling work in Alsace returned a high grade of 214 mg/L lithium with low impurities.

Importantly, “existing geothermal operations in the region indicate brine composition in Alsace is materially the same as the brine composition across the border at Vulcan’s operations in Germany, meaning Vulcan’s sustainable lithium production process is applicable across the whole field.

This is significant as VUL recently reported that its brine graded 57.1% lithium hydroxide (LiOH), easily exceeding the best-on-the-market battery grade specification of 56.5% LiOH that is required from offtake customers.

What’s next for VUL? We are now looking towards Phase 1 of the Definitive Feasibility Study (DFS), which VUL expects in the first quarter of 2023.

Companies of interest at IMARC conference


Nov 02, 2022


We’re at IMARC (International Mining and Resources Conference) where over 450 mining leaders and resource experts have descended on Sydney - and it all kicks off today. Organisers anticipate over 7000 attendees will visit the expo over the next 3 days.

Majors such as BHP, Rio Tinto, Glencore and Newcrest are presenting, alongside a host of juniors and industry professionals.

We are particularly interested in hearing from a few of our Investments on the programme. Today, AuKing Mining (ASX:AKN) will be presenting at 12:50pm fresh off its acquisition deal for uranium assets in Tanzania. Following this, Sarytogan Graphite (ASX: SGA) enteris the Mining Pitch Battle at 1:10pm amongst a panel of institutional funds.

We will also catch up at the conference with management from Latin Resources, European Lithium, Los Cerros and Titan Minerals.

3 Drill Programs in Q1 after strong cobalt results


Nov 02, 2022


Investment Memo: KNI IM-2022

Our European battery metals exploration Investment Kuniko (ASX:KNI) released its quarterly report on Monday.

The report was a comprehensive look at KNI’s progress to date, and included more information on the company’s plans going forward.

Most important to us, is the fact that KNI is targeting a three-pronged exploration strategy in Q1 2023.

First, KNI will be testing further targets along strike at Skuterud, where they found significant cobalt-copper mineralisation in all 8 drill holes from the company’s first drill program at the historically producing mine.

Second, KNI is targeting a maiden drill campaign at another brownfields battery metals project called Ringerike.

Ringerike is 15kms away from Skuterud and has returned rock assay grades of up to 1.55% Ni and 4.12% Cu.

With a promising stream sediment sampling program already completed, KNI will aim to drill Ringerike in Q1 2023 as well.

Finally, KNI is also pursuing a Q1 2023 drill program for the Undal-Nyberget copper project to test “high-priority targets” pending the results of currently ongoing geophysics analysis.

Undal-Nyberget is located to the north of Skuterud on the west coast of Norway:

Undal-Nyberget had historical production grades 1.15 % Cu, 1.86 % Zn and surface grades of up to 2% Cu.

Those are excellent copper and zinc grades and Undal-Nyberget looks promising to us at this stage.

All up it means Q1 2023 should be a very busy period for KNI as they pursue this three-pronged exploration strategy.

KNI finished the most recent quarter with a solid $8.3M in cash.

Brokers comparing LRS to $5.7BN capped Sigma Lithium


Nov 02, 2022

Investment Memo: LRS-IM2
Investment Thesis 5 : Favourable peer comparison

Late last week we saw both Bell Potter and PAC Partners initiate coverage and release research reports on our lithium exploration Investment Latin Resources (ASX: LRS).

Both reports made mention of LRS’s upcoming maiden mineral resource estimate, while also detailing how LRS’s project could grow into a project analogous to that of its $5.7BN neighbour, Sigma Lithium.

Bell Potter said that they “expect that the deposit could notionally support +200ktpa spodumene concentrate operation. A potential analogue of Salinas is Sigma Lithium’s project located around 100km to the southeast”.

An interesting point that we took from the PAC Partners report was a comparison of Sigma Lithium’s rise to where LRS finds itself today.

PAC speculated that LRS’s maiden mineral resource estimate “could be of size range 11Mt to 17Mt with a grade range 1.3% to 1.5%” and that, “For comparison, Brazil peer Sigma’s initial mineral resource estimate was 13Mt at 1.56% in 2018”.

When Sigma announced that resource estimate, its market cap was around the same as LRS’s is today.

Sigma has since defined a total of five different deposits.

In a similar fashion, LRS is now putting together its first JORC resource and has just announced a new discovery, just 500m from its first discovery.

The following chart showing Sigma’s share price and notable events puts LRS’s progress into perspective:

Sigma now trades with a $5.7BN market cap, or 25 times as much as LRS’s $230M market cap.

To see the two broker reports click on the following links:

  1. PAC Partners research report
  2. Bell Potter research report

What’s next:

We want to see LRS’s maiden mineral resource estimate, for which we previously set our expectations as follows:

  • Bull case (exceptional) = >15Mt JORC resource
  • Base case = 5-15Mt JORC resource
  • Bear case = <5Mt JORC resource

Read our latest LRS article to see the reasoning behind our expectations: Lithium deposit getting bigger - plenty more drilling to come

88E neighbour $1.4BN Pantheon just weeks away from flow test


Oct 31, 2022

Investment Memo: 88E IM2
Investment Thesis 2 : Nearology to Pantheon Resources

Just last week UK-listed Pantheon Resources (capped at $1.4BN) put out an operational update on the drilling of its first horizontal production well, which is being drilled next door to ground held by our oil and gas exploration Investment 88 Energy (ASX: 88E).

Pantheon confirmed that it has paused flow testing while it brings in longer term production testing equipment. Pantheon is now going through the clean up process where fracking fluids are recovered and the well is cleaned up for a longer term production test.

Pantheon CEO Jay Cheatham said, “We hope to complete our clean-up programme at Alkaid #2 over the next several weeks and we will announce the results of flow testing once complete”.

This should mean we get to see a flow rate from 88E’s neighbour in the coming weeks.

If the news is positive the market could start to show a lot of interest in 88E’s upcoming drilling program (next door to Pantheon).

For some context on why this news matters to 88E:

  1. Ground next door to Pantheon - 88E’s Icewine East project sits right next door to the wells Pantheon has been drilling and more importantly the Alkaid #2 well where it is looking to get a commercial flow test from.
  2. 3D seismic data in place - 88E acquired 3D seismic data over its project with an independent review of the data indicating that the reservoir units Pantheon are flow testing extend into 88E’s ground.
  3. Prospective resource announced - 88E recently announced 1.03 billion barrels on a gross mean unrisked basis at its project.
  4. Drilling now planned for 2023 - 88E confirmed it will drill the Hickory-1 well in 2023, looking to test the same reservoir units Pantheon has had success drilling.

We will continue to monitor Pantheon’s news flow to see what comes from its flow testing program.

Acquisition of OntheNet completed and board appointments


Oct 28, 2022


Investment Memo: VN8 IM-2022
Investment Thesis 1 : ‘Hunt for Growth’ aggressive acquisition strategy
Objective 2 : Grow users through integrated acquisitions and cross-selling opportunities

Our small cap telco Investment Vonex (ASX:VN8) has completed its acquisition of Queensland-based telco OntheNet.

OntheNet provides data network, voice and hosting/colocation services primarily to SMEs (small and medium enterprises).

The acquisition is projected to add ~$15M to VN8’s annual recurring revenue (ARR) which has now grown to ~$51M, and adds ~$2M in EBITDA for a total of ~$8.5M.

We like that the acquisition is “accretive” to VN8’s key financial metrics, including earnings per share (EPS), EBITDA and free-cash flow (FCF) on a full year pro forma basis. The chart below illustrates the new revenue mix following the acquisition.

VN8 has paid total consideration of approximately $9.8 million for OntheNet — $7.7M in cash and $1.9M in escrowed shares.

Our more in depth commentary on this acquisition can be found here - VN8 grows to $51M Annual Recurring Revenue with Latest Acquisition.

The OntheNet deal marks the fifth acquisition for VN8 since listing in 2018, helping propel ARR beyond $50M.

VN8 is following the tried and tested telco consolidation strategy to growth, by driving revenue through: acquisition, integration, and achieving economies of scale.

We track ARR as a metric as it is essentially the amount of revenue expected every year - providing a useful guide to the continual impact of acquisitions to the ongoing business.

On the management front, VN8 has announced the appointment of Stephe Wilks as Non-Executive Chair and Brent Paddon as Non-Executive Director. Both have extensive experience within the IT and telecommunications industries. In particular, Stephe was managing director of XYZed, an Optus company, where he developed and managed Australia’s first competitive broadband wholesaler is pertinent to VN8’s business.

What’s next?

Next up for VN8 will be to integrate OntheNet and report on its impact. Also on the horizon, we expect:

🔲 Completion of integration of Direct Business (2H22)
🔲 Further potential acquisitions (2H22-23)
🔲 Sustain cashflow positive quarters going forward (2H22)
🔲 EBITDA positive (2H22)
🔲 125k PBX users (4Q22 - 1H23)

Patient Recruitment and quarterly cash flow update


Oct 27, 2022


Investment Memo: DXB IM-2022
Investment Thesis 4 : Fully Funded
Objective 4 : Progress the Phase III Clinical Trial for Rare Kidney Disease (FSGS)
Milestone 6 : Patient Recruitment Updates

Our 2021 Biotech Pick of the Year, Dimerix (ASX:DXB), released its quarterly today as well as an investor presentation which provided an update on patient recruitment for their crucial Phase 3 FSGS trial.

Below is a chart which shows DXB’s progression towards completion of patient recruitment for Part 1 of the FSGS trial, which will enable an interim analysis (a major potential catalyst for DXB):

Key takeaways:

  • Patient recruitment on track - 48 patients of required 72 (67% complete)
  • Interim analysis in mid 2023 on track - as a result of the patient recruitment numbers DXB remains confident that they will get the first data from the Phase 3 trial on time
  • Good cash position - this was a major positive DXB has ~$12M in cash ($6M existing +$6M from the R&D Tax Incentive Rebate just received) meaning we’re confident enough to say that DXB is fully funded through to the the interim analysis for the FSGS trial
  • Reduced cash outflow - $3.5M which is a big improvement on the $7.2M last quarter which was due to trial start up costs. We expect this number to come down further over the next quarter as start up costs for the trial will no longer be required.
  • Lots of big transactions in kidney space - billions of dollars are flowing to the kidney treatment deal space. In particular, the Vifor Pharma and Angion Biomedica deal which has a total deal value $1.9BN. That was for a Phase 3 renal treatment for acute kidney injury.

What’s next for DXB? We’re hoping to see further patient recruitment updates in particular when that magic 72 patient number is hit. DXB is expecting to reach 72 patients recruited in November at the current rate.

Noble Helium raises $6.1M - we participated


Oct 27, 2022


Investment Memo: NHE IM-2022

Our helium exploration Investment Noble Helium (ASX:NHE) has successfully received firm commitments to raise $6.1M at 15c in an oversubscribed Placement.

We participated in this placement, and were scaled back - confirming yes, that this was indeed an oversubscribed placement. This is a good sign of the broader appetite of institutional and sophisticated investors to invest in NHE.

New Exec Chairman Shaun Scott (ex Arrow Energy) also put in $100k - we always like it when management puts their own funds into the companies they run.

As per the standard market response, NHE shares came back trading today, and are sitting around the placement price of 15c.

Since our Initial Investment in NHE we’ve not sold a single share and we were happy to add to our position given the progress NHE has made since its IPO in April of this year.

NHE’s helium exploration targets are large - equivalent in value to multiple TCFs of natural gas, due to the premium pricing that helium commands.

We think NHE is about 6-9 months out from a drilling event based on recent announcements and presentations, which we like as an entry point ahead of potential share price uplift and liquidity ahead of drilling.

The shares will be issued in two tranches:

  • Tranche 1 will be for 27.4 million shares to raise A$4.1M on 4 November
  • Tranche 2 will be for 13.1 million shares to raise A$1.9M and will need shareholder approval at the NHE AGM on 30 November.

Pending that approval, NHE will have a post cap raise cash balance of $10.3M, which we think is a healthy position to advance the following:

  1. Start buying long lead items for the drilling program (Q3 2023)
  2. Contract a drilling program management team
  3. Look at potentially acquiring new helium projects using the Global Helium Atlas

What’s next for NHE? NHE Managing Director Justyn Wood said in the near term the company’s attention is squarely on finishing the 3D seismic survey, which could unlock further capital for NHE via a farm-in process.

We expect there to be significant interest during the farm-in process given the scale of resource being pursued at NHE’s Tanzanian helium project.

Palladium grades increasing; corridor expands


Oct 27, 2022


Investment Memo: GAL IM-2022
Investment Thesis 5 : Well-funded for exploration
Objective 4 : Execute drilling campaigns at Norseman (Callisto) PGE Discovery
Milestone 2 : Diamond drilling to test for extensions at depth.
Milestone 3 : Assay results: (Bull case = over 3.0 g/t, Base Case = over 1.0 g/t, Bearish case = grades start to fall below 1g/t.)

Diamond core drill assays are starting to come in from Galileo Mining’s (ASX:GAL) Callisto palladium-platinum discovery at its Norseman Project in WA.

GAL has so far completed 25 diamond core drill holes and yesterday reported on assays from drillhole NRCD279m, which included 5 metres @ 3.28 g/t 3E (2.64 g/t palladium, 0.46 g/t platinum, 0.18 g/t gold), 0.54% copper & 0.45% nickel from 265m:

These results — 3E (palladium + platinum + gold) grades above 3g/t intercepted over a five-metre interval — are from the lower disseminated sulphide zone at Callisto and show palladium-platinum-gold-copper-nickel grades increasing at depth.

GAL expects further assays to be back from the lab from mid-November onwards. We look forward to these results, especially given managing director Brad Underwood’s comment:

“...we believe that the potential for further success continues to be exceptional”.

We note that these results further expand the west-east corridor, with the distance between the western most drill hole that had significant assays and hole NRCD279 in the east now measuring over 500 metres and it remains open in both directions.

Plus, GAL still has over five kilometres of prospective rocks to explore to the north. (GAL expects assays from regional scout RC drilling to the north to be back from the laboratory in early to mid-November.)

A lot more drilling is needed to determine the full extent and grade of palladium and other metals in the Callisto region. That shouldn’t be a problem, with GAL confirming in its quarterly activities report this morning that it remains well funded to continue drilling with around $23.5M cash in the bank.

On Monday we took a deeper dive into GAL’s exploration program at Callisto, providing 3D models of our interpretation of the drilling results to date.

You can read that report here: Understanding it all… in 3D.

Drilling campaign completed at Koongie Park base metals project


Oct 27, 2022


Investment Memo: AKN IM1

This morning, our base metals junior Investment AuKing Mining (ASX:AKN) announced that they’ve wrapped up the current round of drilling at its Koongie Park base metals project (80% stake) in the Halls Creek mining hub, WA.

While we wait to see the outcome of a promising uranium acquisition in Tanzania, AKN has finished up drilling in WA.

We view the results reported today as largely positive, with the potential for a significant resource upgrade on the cards.

Koongie Park currently hosts a 8.9Mt resource, containing 1.01% copper, 3.67% zinc, 0.77% lead, 0.16g/t gold, and 26g/t silver.

This drilling campaign comprised a combined 7,438m reverse circulation (RC) and diamond drilling across multiple prospects.

Assays returned from holes to the north and also in the deeper sulphide zones of the Sandiego deposit confirmed further zones of copper mineralisation, providing a basis to significantly extend the existing resources at the deposit. Further holes are planned for the next campaign.

However, four follow up holes at the Cosmo prospect returned no significant copper mineralisation.

Assay results are pending for the Emull prospect, which is poised to significantly increase the total resource base at Koongie Park once incorporated.

What’s next for AKN? Next on the horizon for AKN will be the increase in JORC resources at Koongie Park, as well as progress with the acquisition of Tanzanian uranium and copper assets (our commentary here - Can this Tanzanian Exploration Maverick Lead AKN to Uranium Success?), both likely in the December quarter.

ALA narrows focus to iNKT cell therapy


Oct 26, 2022


Investment Memo: ALA IM-2022
Risk 4 : Funding risk

Our early stage biotech Investment Arovella Therapeutics (ASX:ALA) is now fully focussed on its iNKT cell therapy after deciding to discontinue its legacy OroMist based products.

The benefit of not pursuing any further work on OroMist products comes in the form of $1.5M annual cost savings.

We think it's a good strategic move for ALA to prioritise its core treatment.

The move will incur a one off $300k restructuring cost, but we know how hard it is for small-caps to raise funds and long-term, this makes sense.

A lower cash burn is always welcome.

ALA is also particularly clear about what’s in the pipeline in terms of news flow, and gave the following timetable for progressing their iNKT cell therapy:

What’s next for ALA? After partnering with ASX biotech giant Imugene to work on a treatment that could target 90% of all cancers (solid tumours), we’re particularly looking forward to the in vitro and in vivo study outcomes.

NT Lithium Project Update


Oct 26, 2022


Investment Memo: RAS IM-2022
Investment Thesis 1 : Lithium projects along strike to Core Lithium (currently capped at $2.3 billion)

Our exploration Investment, Ragusa Minerals (ASX:RAS) gave an update today regarding the company’s NT lithium project.

So far, RAS has completed eight RC drillholes hitting significant pegmatite interceptions which include:

  • Drillhole 22RC07 - 27m interval from 16m depth
  • Drillhole 22RC017 - 19m interval from 69m depth
  • Drillhole 22RC024 - 15m interval from 49m depth

The key takeaway for us at this stage is that all of these intercepts are coming from shallow depths starting from as low as 16m.

RAS also confirmed that the pegmatites have “apple-green crystals” within them which the company says could represent spodumene crystals.

With spodumene being the host rock for much of the world's lithium production, this would be positive news for RAS if it is the case.

We will need to wait for the assay results to be sure, however.

All up we see this news as a good early result and are eagerly awaiting the assays from this initial (and recently expanded) ~4000m drill program.

RAS intends to drill through the wet season, weather permitting.

It’s an aggressive style of exploration, and comes at a time when the lithium price remains elevated:

More promising results from Copper Ridge Porphyry prospect


Oct 26, 2022


Investment Memo: TTM IM-2022
Objective 2 : Follow-up drilling at Linderos

This morning, our Ecuadorian gold and copper Investment Titan Minerals (ASX:TTM) provided an update on drilling at the Copper Ridge Porphyry prospect within its Linderos project in southern Ecuador.

Four of the planned six diamond holes have now been completed within the maiden drilling campaign, with first assays expected in mid-late November. These holes are deep, going to an average depth of 500 metres, with a total of 1,985 metres drilled to date

We are keen to see how the assays turn out, given that the first two holes appear to have intercepted several zones of sulphide mineralisation.

At the first drillhole, TTM looks to have hit up to 242.75m of sulphides. At the second hole, TTM intersected a maximum intercept length of ~182.76m of sulphides as well. Our most recent commentary on these results can be found here - Promising Early Copper/Gold Exploration Results - Assays Soon.

Intersecting such extensive sulphides matters, as these can typically contain copper that is readily extractable utilising conventional means i.e. we won’t require new processing solutions to extract the valuable minerals within.

The caveat is that until the assays are delivered, we won't know if copper and other metals are contained in economically viable quantities within these drill holes.

Today’s news is that the third and fourth drill holes appear to have followed in the path of the first two, with further wide intervals of altered and stock-work veined porphyry with significant amounts of chalcopyrite, molybdenite, pyrite and pyrrhotite mineralisation observed in each.

The next key milestone will be the assay results from the first two holes at Copper Ridge, expected in a few weeks time. Soon thereafter, assays from the Meseta gold prospect within the Linderos Project are expected, sometime in late December.

$25M grant for proposed Cape Hardy port development stands


Oct 25, 2022


Investment Memo: IRD IM-2022
Risk 1 : Project Funding risk

Funding to progress big projects remains a key hurdle for developers, so we are encouraged that our long-term Wise-Owl iron ore Investment Iron Road (ASX:IRD) has received support from the Australian government.

IRD fully owns a 1,200 hectare greenfield site at Cape Hardy on the Eyre Peninsula of South Australia, which it plans to develop into a multi-commodity export facility at a cost of ~$250M (CAPEX).

IRD today announced that the Australian government has maintained its commitment to fund $25M to assist financing and development of the proposed Cape Hardy port. Cape Hardy also has strong support from the South Australian Government and Infrastructure Australia.

This development would benefit several key local industries including agriculture, mining, renewable hydrogen, green manufacturing and First Nations businesses, via the creation of a manufacturing and export hub.

For IRD, Cape Hardy is the logical logistical channel for its flagship asset, the Central Eyre Iron Project (CEIP). The development ready project hosts Australia’s largest undeveloped magnetite deposit, with a 3.7 billion tonne Ore Reserve, capable of producing 589Mt of high-grade magnetite (66.7% Fe) over the life of the mine.

Next up we’re keen to see commercial arrangements progress with parties interested in co-developing Cape Hardy as a green hydrogen hub/ industrial precinct, likely towards the end of this year.

25% more land under licence for PRL's green hydrogen project


Oct 25, 2022


Investment Memo: PRL IM-2022
Objective 2 : Secure key stakeholder support

Today, our green hydrogen Investment Province Resources (ASX:PRL) announced that it had secured an additional 1,035 square kilometres of land south of Carnarvon, WA.

That’s equivalent to a roughly 25% increase in the company’s licenced land area, bringing PRL to a total of 4,162 square kilometres under licence.

We think it adds further momentum behind the proposed HyEnergy® green hydrogen project in WA as PRL negotiates the shareholders agreement with Total Eren.

In our last note on PRL, we argued that the scale of PRL’s project is akin to the $34BN North West Shelf Joint Venture which made Woodside what it is today - a $67BN market capped company.

Obviously there’s a long way to go for the $100M capped PRL and a number of risks, some of which we outline in our PRL Investment Memo.

But we’re hoping with history as a guide, PRL can go on to play a major role in Australia's energy transition.

What’s next for PRL? Convert the binding key terms from late August into a comprehensive legal document that will govern the running of the new joint venture entity

DXB gets $6M R&D Tax Incentive Rebate


Oct 25, 2022

Investment Memo: DXB IM-2022
Investment Thesis 4 : Fully Funded

We’re very pleased to see our late stage biotech Investment Dimerix (ASX:DXB), got a sizeable R&D Tax Incentive Rebate from the Australian Government today.

A total of $6M, in fact.

The large rebate puts DXB in a more robust financial position going into the interim analysis point for its Phase 3 FSGS trial - our main bet for DXB.

DXB spent a significant amount last quarter (~$7.2M) setting up the trial sites for its FSGS trial - and that big outlay is now largely paid for.

Like many biotechs, DXB has tracked the broader sector down the charts and currently sits 17.5 cents close to our initial entry price of 20 cents.

We remain Invested to see the results of the FSGS trial, in particular the interim analysis point which DXB remains on track for in mid-2023.

This looms as a major catalyst for DXB, especially in light of some of the major transactions happening in the market for kidney diseases.

What’s next for DXB? We’re looking for a further update regarding patient recruitment for the FSGS trial.

Promising early results at Ecuadorian gold project


Oct 25, 2022


Investment Memo: TTM IM-2022
Objective 2 : Follow-up drilling at Linderos

Our Ecuadorian gold and copper Investment Titan Minerals (ASX:TTM) has nearly completed its first drilling campaign at the Meseta gold prospect, within the Linderos project in southern Ecuador.

So far, 14 of 18 diamond drill holes have been completed in the 2,500 metre campaign. This drilling is designed to test the presence of plunging high-grade ore shoots at interpreted structural intersections.

In a promising early sign, multiple narrow high-sulphidation pyrite-sphalerite-arsenopyrite ± galena, massive sulphide veins have been intersected.

While that’s a lot to say, importantly, these minerals often point to the presence of gold.

However, whether there is gold in economic quantities will only be revealed once the assays are returned, likely in late December or early in the new year.

Today’s news fits in with our #2 Objective that we want to see TTM deliver this year:

We note that the drill rig has now moved back to the Copper Ridge prospect (also within the Linderos project), where drilling has intercepted several wide zones of sulphide mineralisation.

That makes two rigs on site, underlining the promising prospectivity of Copper Ridge - we provided an update on these latest results recently here - Promising Early Copper/Gold Exploration Results - Assays Soon.

We’re keen to see how the assays look at the other end for both Meseta and Copper Ridge, and will update once delivered, likely in the next quarter.

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