SGQ hits extensions to its rare earths resource

Our niobium/rare earths Investment St George Mining (ASX: SGQ) just hit a big rare earth intercept ~230m west of its existing JORC resource estimate.

SGQ’s resource currently sits at:

• 40.6Mt of Rare Earths at grades of 4.13% TREO (total rare earths oxide)
• 41.2Mt of Niobium at grades of 0.63%

As it stands right now, SGQ’s project is the largest and highest-grade carbonatite-hosted rare earth deposit in South America…

… and the second highest grade REE deposit globally in the Western world.

There were two big takeaways from today’s announcement:

1. SGQ hit a 98.4m intercept with 3.07% total rare earth oxide (TREO) grades FROM SURFACE ~230m to the west of its existing resource, and
2. SGQ kept hit high grade rare earths (up to 25m at 4.42% TREO) from assays ~1km to the east of its existing resource.

That results to the west is actually the first deep diamond drillhole SGQ drilled on the project this year - so its really a first look at how much bigger SGQ’s project could become…

And here is a birds eyeview of where SGQ keeps hitting more rare earths from, relative to its existing JORC resource estimate:

In terms of size, SGQ is comparable to ~$21BN MP Materials’ project.

With drilling now extending the resource to the east and west, we think SGQ’s resource could be bigger than MP’s by the end of the year when SGQ is expecting to upgrade its resource:

SGQ’s new major shareholder - Gina Rinehart

Earlier this week SGQ announced it had completed a $72.5M capital raise at 10c.

SGQ came out of halt yesterday having raised $72.5M…

$50M of that was “led by EU and NA funds”, and $22.5M was taken in one line by Gina Rinehart’s Hancock Prospecting.

Hancock (and Gina) know the rare earths industry really well…

Hancock is already Invested in two of the biggest Western producers of rare earths in the world - $21BN MP Materials and $20BN Lynas Rare Earths.

What’s next for SGQ?

Drilling results 🔄

Drilling is still ongoing on site (24/7) - here is a picture from today’s announcement showing the night shift crew drill the asset:

(Source)

In the short term the main thing we want to see are drill results.

Ideally we see big extensions at depth and to the north/east/west of SGQ’s current JORC resource estimate, which initial results like those today have shown.

Beyond the drilling 🔄

Over the next 12-18 months, a lot of the catalysts for SGQ could come at hard-to-forecast times:

• Updates on downstream processing strategy - We want to see SGQ define its downstream rare earths strategy. We are especially looking forward to an update in relation to the US.
• Start working on development studies - SGQ has already commenced environmental, geotechnical and development studies with a view of getting to economic studies in Q4-2025.
• Pilot plant trials - SGQ has signed an agreement with CEFET to jointly collaborate on a new Pilot Plant trial that will build on the prior 9 month trial from 2012-13 which successfully produced rare earth product at over 99% purity and recoveries of 86% TREO.

SGQ is also participating in the “MAGBRAS Initiative” - a program that has major automakers like Stellantis working toward building Brazil’s first permanent magnet-making facility.

• Metwork and sample production - SGQ should have results from this in the pipeline with the creation of the St George Technical Centre. The main catalyst we are looking forward to is the re-starting of SGQ’s pilot plant with development of this underway with the agreement signed with CEFET to host and jointly collaborate. This will allow for product samples to be produced for potential strategics/offtake partners.
• Permitting - SGQ is targeting completion for permitting by Q4-2026.
• Finalise the remaining vendor payments - (US$6M due before the end of the year and US$5M due next year). Hopefully, SGQ can follow up on the $8M cornerstone investment it managed to get from Xinhai Group earlier this year.

(Source)