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IPO Watch: This WA iron ore explorer picked a bad day to list, but Pearl Gull is in for the long haul

Imagine you own a mining tenement immediately next to the highest grade DSO iron ore mine in history. Iron ore … Read More
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This article was originally published by Stockhead

Imagine you own a mining tenement immediately next to the highest grade DSO iron ore mine in history.

Iron ore gets sold from your country, Australia, to China, where more than half of the global steel industry lives.

A pandemic happens, governments juice their economies full of stimulus roids and China’s steel factories go crazy, pumping more iron than they’ve ever done before.

Prices rise 15% beyond where they’ve ever been before, the world’s biggest miners are making squillions for their shareholders, some get drunk on the power and think they’re Jesus and you attract $4 million from investors at 20c a share to explore and develop your project in the best market you’ve ever seen.

Then China turns off the taps, the price halves in a matter of weeks and your company’s shares are made available to be bought and sold by the public the exact day iron ore tips below US$100/t for the first time in over a year.

 

… and it’s a true story

That happened yesterday to Pearl Gull Iron (ASX:PLG), which unsurprisingly lost 12.5% on its first day of trade to close at 17.5c on a punishing day for iron ore stocks.

But as director Jonathan Fisher tells Stockhead, the company is not trying to rush into production and capitalise on the here and now. Its aim is to drill and uncover a mine that will stand up to a sustainable iron ore market.

It owns the mining lease immediately next to the Seawall Pit mine on Cockatoo Island in the Buccaneer Archipelago, a northern outpost off WA’s Kimberley coast where dense iron ore was first found by pearl luggers, and where mining giant BHP first mined iron ore in the 1950s.

The Seawall Pit produced some 45Mt of iron ore between 1951 and 2012, with direct shipping grades as high as 67% iron ore, well above the 62% benchmark fines grade.

Pearl Gull has reason to believe some of that mineralisation continues onto its ground, and is closely watching the nearby Koolan Island mine, about 5km away, which is being revived by ASX-listed miner Mt Gibson Iron (ASX:MGX).

 

This is probably something that’s a little bit unavoidable, but the price of iron ore has gone down considerably between when you were planning the IPO and raising the money to now. Do you feel like you’ve had a little bit of bad luck with the timing of the float?

“Look, I think it’s fair to say we could’ve picked a better day. But, you know, we’ve been working on this project for quite a while.

“It’s been a good many years and actually, when we first started working on the project, the iron ore price was much lower than it is today.

“I think people have been sort of lulled into a false sense of expectation. From a seriously high and unsustainable spot price of over US$200/t to around the US$95-100 where it is today or where the forwards are, that’s still a pretty damn good price.

“And when you factor in a relatively weaker Aussie dollar at 72 cents, that’s a great Aussie dollar price for iron ore; everyone makes money.”

 

I imagine the idea is about establishing a resource and establishing a project that perseveres at any sort of realistic iron ore price scenario, rather than what we’ve seen in in recent times where, you know, juniors have taken on cash costs of $120 plus.

“I think the first thing to know is the importance of grade.

“Cockatoo Island has a history, not on our tenement but on the tenement next door, of producing the highest grade iron ore in the world.

“And what does that do? It gives you a massive price premium, which is obviously, you know, cash costs are one thing, but really what you’re looking for is gross margin.

‘There are stories going back in the early days, with people saying the ore was so hight grade you could actually weld it’

“So grade, number one. The other thing about Cockatoo versus other juniors who are looking to suspend is their transport costs to get to port.

“Inland transport is often the largest cost for these junior miners and the inland transport costs of something from Cockatoo Island is negligible.

“You literally roll the ore down the hill. So there are some benefits, obviously, that we have in terms of grade and in terms of closeness to water that others don’t have.

“And what does that mean? It means that in any reasonable and sustainable iron ore price environment, we should make money.”

 

How do these prospects compare to the historic Cockatoo Island assets in terms of the level to which they’ve been explored and the results that previous explorers have had before you?

“So the nearest term opportunity for us we call the Switch Pit, that was actually previously effectively an old ramp access into the historic Seawall mining pit, which is owned by a third party, that’s not our tenement.

“But you can see the continuation of the historic, Seawall Pit mineralisation coming across onto our tenement. So that’s great, because you often don’t get visual cues when you’re doing exploration. There’s some pretty good confidence there is ore there and that is the same type of mineralisation. And therefore, you could interpret something around that at a similar grade to the historic Cockatoo, which is extremely high.

“That’s a small nodule of iron ore that sitting there that you would look to take out relatively short term.

“What we then see is our other two projects in North Bay and Magazine are I guess what you call mine life extension opportunities to pursue after the near term ore at Switch Pit has been mined.

“North Bay has not been drilled before but there again there are visual clues along the way.

“The Magazine project does have some historic RC drilling in it, but you’re not able to define a JORC2012 compliant resource off the back of that.

“So we will be sinking a couple of holes in there as well, looking to bring that up out to a standard which could possibly report a resource in compliance with JORC2012. Magazine looks like from the current historic drilling that it would be more of a beneficiation grade resource.

“And what’s interesting is there actually was a beneficiation plant that successfully operated on Cockatoo for many years. Some of the low-grade ore did upgrade very successfully to a 65-66% product.

“And that’s quite different to Pilbara ores, where trying to beneficiate and get more than a few per cent gain on a Pilbara ore is very difficult.”

Drilling for iron ore at the North Bay prospect on Cockatoo Island Pic: Pearl Gull Iron

 

When you look in terms of the money that you’ve raised, you’ve got $4 million from the IPO price at 20 cents. And you did say that that was oversubscribed, when you raise the money as well. Where does that get spent over the next two years?

“We’ve been drilling since July, that was announced in the prospectus.

“And obviously being up north there, you’ve got a drilling season. So we’ll be drilling for as long as we can.

“We should probably be probably till late October-ish, I would expect, and then during the wet season it’s just not possible to drill up there.

“We’ll be receiving assay results, doing interpretive modeling, planning, all that kind of good stuff. And to the extent that we obviously need to do confirmatory drilling or more drilling we’ll continue that over the next drilling season.

“Those IPO funds see us through doing all that. Obviously, if we look to develop, we’ll raise capital for that.”

 

The other thing that I guess is maybe a little bit distinct from other iron ore companies is the potential for producing subsea ballast and quarry rock as well.

“So this is a really interesting opportunity and it goes towards your pit shell design.

“The geology on Cockatoo, it’s an island, it’s hilly.

“In mining, always the key is a strip ratio, how much waste you’re mining and so any opportunities you’ve got to turn otherwise non-payable material into payable material, when you change that in your block model that can totally change and optimise your pit shell design and therefore allow you to get more iron ore out of it and make money.

“You know one of the things about that material at Cockatoo is it’s dense, it’s heavy, it’s competent. And it’s actually one of the few disturbed areas capable providing quarry material in that North West region of Western Australia, which is close to oil and gas fields.

“So historically, some of the ballast used offshore in the North West Shelf has actually come from as far away as Scandinavia.

“That doesn’t make sense, we’ve got a perfectly good rock quarry there on Cockatoo. And to the extent that we can take that material out, for a small cash margin you make some money and diversify slightly away the iron ore price.

“But the key issue is you might be able to completely change your pit shell design. So that’s really interesting.”

 

Your neighbours have the Seawall Pit which needs to be pumped out after the last owner there Pluton Resources went into administration, is that right?

“I think in my view, we’ve got the best of both worlds, because we can see the benefits from that old Seawall Pit, we can visually see the continuity of the orebody onto our tenements.

“So we kind of get a bit of it without having the historic, massive environmental liability that Seawall pit presents.

“We see it, we can see across our tenements all the good stuff. And hopefully, we can actually be in production sooner because we don’t have to spend a long time dewatering a pit.”

Cockatoo Island layout
Pic: Pearl Gull Iron

 

It’s a bit different as well, you’re sort of mining in towards the middle of the island.

“So what’s interesting there is there’s a bit of nearology.

“Koolan Island’s we’ll call it five clicks away to the east, and you look at what what MGX has done at Koolan, and you say, well, you know, can we can we do that on Cockatoo.

“And you get where the Mullet, Acacia and Eastern and Barramundi Pits are through the middle of the island on Koolan and you look to Cockatoo, and that similar area on Cockatoo has never been drilled.

“That’s what we looked into in the North Bay area. You know, the islands are quite similar.

“They both have the Cockatoo formation, with the hanging seawall pit down the side, they both have a pit that goes underwater.

“The question is, well, does Cockatoo have the same kind of deposit up through the middle of the island as Koolan does? What’s interesting when you look at Koolan is a couple of things, first of all, I believe they’re having a look there to see if they can take any more ore from there.

“The second is they are small poddy kind of pits. It’s not like one large mineralisation band running through there, they’ve obviously mined out several pods along the way.

“And so, again, when you look back at Cockatoo you’d expect something similar whereby if there is the high-grade repeat there it’s not going to be a massive long line. It would be poddy deposits of it, similar to what you’d find in Koolan, that’s our theory anyway and it’s what we’re exploring for.”

 

If you look at Cockatoo in terms of the history and we know about the 45 million tonnes of high grade production that’s come out of there over the last 60-odd years. And in fact, wasn’t it one of the original iron ore exporters out of Australia?

“It was BHP’s first iron ore mine in WA I think. It’s interesting if you know the history of Cockatoo and how it was discovered.

“And actually, it comes into our name Pearl Gull. The Pearl luggers, who came out of Broome and serviced the pearling industry used to stop off at Cockatoo and pick up this bloody heavy black rock that they used to use as ballast in the boat.

“And that’s how they’ve been discovered. What is this super heavy ballast, oh it’s almost pure iron ore.

“There are stories going back in the early days, with people saying the ore was so hight grade you could actually weld it; I don’t know if that’s true or not but it is extremely high grade.

“So the Pearl Gull was one of the pearl luggers that used to service the Broome pearling industry and used to stop off at Cockatoo for ballast.

“Obviously, BHP then found larger and more easy to mine deposits in the Pilbara at scale. And at a time when iron ore pricing was way lower than it is today they decided to discontinue operations on Cockatoo.”

 

The high grade aspect, does that excite you from the macro perspective of – obviously premiums at the moment are contracting because the price is going down – but there is that expectation long term that higher grade iron ore will continue to attract the premium and that could grow as you know, steel production needs to get cleaner?

“So you hit the nail on the head, right? It’s a long term thematic, which is, you know, how do you make the iron ore industry greener?

“In China at the moment, for example, Beijing has got these sort of these opposing targets. One of them is post-COVID infrastructure spending. The second thing is, hey, we’ve got the Winter Olympics coming up and in February in Beijing and we want blue skies, so let’s cut back on steel production.

“Now, the way that mills can actually sort of meet those two seemingly incompatible goals is actually use high grade ore because you can then make more product and you produce less waste and less emissions.

“And going forward, carbon intensity and emissions intensity of the industry is going to be a much bigger issue than it is today.

“You’re already seeing it today and that should drive premiums for high grade ore, especially high grade direct ship ore that will go straight into the blast furnace without any need to sinter which is obviously a horrific environmental process.

“So the higher 60% grades we hope to produce absolutely will be in demand.”

The post IPO Watch: This WA iron ore explorer picked a bad day to list, but Pearl Gull is in for the long haul appeared first on Stockhead.



Author: Josh Chiat

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Energy & Critical Metals

Pegasus Resources Expands Its Uranium Assets In Saskatchewan

Pegasus Resources Inc. (TSXV:PEGA) continues to make its presence in the prolific Athabasca Basin uranium camp with the recently announced
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Pegasus Resources Inc. (TSXV:PEGA) continues to make its presence in the prolific Athabasca Basin uranium camp with the recently announced acquisition of three uranium properties at the northwest edge of the Basin. The 54,026 hectare properties comprising 13 mineral claims contain a cumulative total of 535,718 lbs of uranium, and significantly, includes a historic resource estimate of 202,200 tons at 0.119% U308 at an average width of 4.8 metres.

These new properties add to the previously announced Pine Channel uranium property which consists of six mineral claims covering 6,028 hectares and is located at the northern edge of the Athabasca basin, roughly 40 km west of the town of Stony Rapids. The Athabasca Basin in Northern Saskatchewan is host to several of the world’s largest and highest-grade uranium mines, including Cameco’s (TSX: CCO) McArthur River Mine and Cigar Lake Mine.

The Wollaston Northeast property is located in the 20A zone within the prolific Wollaston Domain, 45 kilometres northeast of the Eagle Point Uranium Mine. The property has at least eight known base metals showings and five previously documented uranium occurrences, and is considered highly prospective for basement hosted uranium mineralization.

Much of the recent renewed interest in uranium in the region is due to recent discoveries within the Wollaston Domain where the Eagle Point deposits are hosted within its basement rocks. In addition to the Eagle Point Mine, the area also hosts the historic Rabbit Lake Mine and Cameco/Orano Key Lake Mine, the world’s largest high-grade uranium mine.

The 12,397 hectare Bentley Lake Uranium Property consisting of three mineral claims, and is located 35 kilometres northeast of the edge of the Athabasca Basin, within a transition zone between the Wollaston and Mudjatic Domains. This trend is host to several major uranium deposits, including Cigar Lake, Roughrider, McArthur River and Midwest. It is located at the transition zone between the Wollaston and Mudjatik geological domains.

The third property is located approximately 40 kilometres northeast of the edge of the Athabasca Basin and within the Charlebois-Higginson Lake Uranium District. The 6,908 hectare Mozzie Lake Uranium Property consists of three mineral claims and has a historical resource estimate of 204,200 tons at 0.119% U308, with an average width of 4.8 metres, and containing 535,718 lbs of uranium. What makes the Mozzie Lake Property particularly compelling, aside from the historical resource estimate that Pegasus’s exploration efforts may be able to increase significantly, are the pegmatite deposits of the Charlebois-Higginson Lake Uranium District.

Since being initially explored from the 1940’s through to the 1960’s, there has been virtually no exploration on the property. Previous work in the region, as well as on the Pinkham Lake property at Mozzie Lake, indicated that the pegmatite deposits may also host mineralization which contains rare-earth-element bearing minerals. Rare earth minerals are in high demand today due to the needs of the various technology, consumer electronics, and electric vehicle manufacturing industries. PEGA plans to examine the property’s rare earth potential as part of its uranium exploration program at Mozzie Lake.

Pegasus will next review the historical data on the properties to determine an exploration strategy and work programs, and will provide shareholders with updates in the near future. The company’s recent announcements of the uranium assets have certainly rekindled interest in PEGA shares, and its market capitalization has increased by almost 50% to $7.98 million in recent weeks, signifying that investors are enthused about the direction management has taken.

PEGA last traded at $0.095 on the TSX Venture exchange.


FULL DISCLOSURE: Pegasus Resources is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Pegasus Resources on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.

The post Pegasus Resources Expands Its Uranium Assets In Saskatchewan appeared first on the deep dive.

Author: Phil Gracin

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Energy & Critical Metals

The Ethical Investor: ESG moves, lessons from the energy crisis and JP Equities’ stock tips

The Ethical Investor is Stockhead’s weekly look at ESG moves on the ASX. This week’s special guest is JP Equity … Read More
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The Ethical Investor is Stockhead’s weekly look at ESG moves on the ASX. This week’s special guest is JP Equity Partners’ director and partner, Nic Brownbill.

The world is in the grip of an ongoing global power crisis that has seen energy prices soaring by thousands of percentage points.

From China to Europe and now India, the cost of energy is surging drastically. The price of natural gas has even quadrupled in some parts of the world.

 

Source: IEA via Reuters

 

But economists are now warning this might be just the first of many power crunches the world will see as we transition into the new economy.

According to a research paper by CommBank’s analyst Vivek Dhar, there are two main root causes that led to the crisis — a strong demand recovery from the pandemic, and an acute shortage of two key power-producing fuels – natural gas and thermal coal.

As economies reopen, there is a sudden pent up demand from consumers which meant that factories were forced to switch on their production capacity at short notice. This was exacerbated by a colder than usual European autumn, as the continent potentially faces a more-freezing-than-usual winter season.

In China, the crisis mainly stemmed from an undersupply in local production of coals, according to Dhar, adding that coal supply has been hampered in China because of the government’s own environmental protection regulations.

So what can we learn from all this?

Dhar reckons that we are transitioning into the new economy too fast, too soon.

“What the recent energy crisis has shown is that the energy transition needs to be planned carefully,” Dhar wrote.

“This will mean significant investment in renewable generation, batteries, electricity grids and hydrogen.”

But he thinks the roll-out of a decarbonised grid and role of gas need to be clearly defined too.

“Under-investing in gas infrastructure relative to its role in coming years will only serve to make Europe’s energy market more vulnerable to prolonged gas shortages, and increase dependence on Russia.”

Like Europe, China’s decarbonisation ambition will need to be planned as well, Dhar said.

“If coal mines and coal power plants are closed before a renewable replacement is in place, power shortages in China could be an ongoing concern.”
 

What’s happening in Australia

Australians have chosen climate change as the top ESG priority, according to the latest survey conducted by global ESG consultant, SEC Newgate.

And more than half of the 1,000 Aussies surveyed said they were happy with the direction the government is taking on the environment.

ESG Rio
Source: Survey by SEC Newgate

 

Aussie respondents also nominated retailers Coles Group (ASX:COL) and Woolworths (ASX:WOW) as the top local companies when it came to doing well on ESG metrics.

These results should provide food for thought for PM Scott Morrison, who’s currently caught in a political wrangle with the Nationals in setting our 2050 climate goals.

The PM has told Liberal colleagues that he wants to bring a binding 2050 net zero commitment to the COP26 Summit in Glasgow next month, without having to upgrade Australia’s 2030 commitments.

Nationals Leader and also Deputy PM, Barnaby Joyce, said however that he was willing to back the 2050 targets only if funding for regional producers and farmers were made as part of the deal.
 

Special guest JP Equities’ Nic Brownbill shares his views and ESG stocks

Nic Brownbill, a partner at JP Equity, told Stockhead that decarbonisation is a mega global investment opportunity, one that JP Equity wants to be all in on.

How big is the potential for ESG investing?

“We see the whole decarbonisation theme as the next mega global investment opportunity. An estimated $41 trillion is required to decarbonise the planet. It’s going to be a bigger opportunity than the crypto market, because unlike cryptos, the carbon market is going to be mandated by governments, major asset managers and pension funds.”

Which segment of the ESG market do you see outperforming?

“Some companies will fall short in trying to make their carbon targets, so the balance will need to be met with carbon credits. I think carbon emissions will eventually be metricated, and the carbon offset market is going to be a way for major companies to offset their emissions.”

Would that investment opportunity catch on in Australia?

“I believe the Australian market hasn’t really caught on to the opportunity of this yet. But I think something will really start to emerge from the COP26 conference in November, where you’ll see a sustained mega theme starting to unfold in this country.

“I think we will start to see a complete emergence of Australian companies in the carbon space over the next few months and beyond.”

What are the ASX stocks that JP Equity likes in the carbon credit space?

One ASX stock that we’ve been watching very closely is  Fertoz (ASX:FTZ). They’re a leading North American fertiliser manufacturer that produces a unique low-emission rock phosphate product that increases crop yield by 15%.

“Importantly, it can generate significantly lower CO2 emissions in manufacturing compared with other commercial fertilisers.

“This presents a really significant opportunity because agriculture as a sector accounts for 24% of all human generated greenhouse emissions. Fertoz is one of the first movers in the carbon credit market, and since May this year has been issuing carbon offset credit certificates.

“It’s not a matter of if, but when disclosure of carbon emissions will become metricated. And as a result, Fertoz is getting some strong enquiries from other companies looking to offset their footprints by buying carbon credits.”

Any other ASX stocks you like in the ESG space?

“We’re also bullish on Mpower (ASX:MPR). The company is Australia’s leading specialist in renewable energy, battery storage and micro-grid business. It has a focus on five megawatt solar farms, and is in the process of creating an initial portfolio of 20 sites across Australia in the coming years.

“That gives them an aggregate capacity of around 100 megawatts, and an estimated value of more than $150 million. It’s now down to what the team can deliver in some of those projects to build up the portfolio.”

 

Notable ASX ESG-related news during the week

Rio Tinto (ASX:RIO)

The energy giant announced that it was targeting a 50% reduction in Scope 1 and 2 emissions by 2030, and a 15% reduction by 2025 from a 2018 baseline of 32.6Mt.

Around $7.5 billion in direct capital expenditure will be spent on decarbonising Rio Tinto’s assets from 2022 to 2030, including $0.5 billion per year from 2022 to 2024.

Strandline Resources (ASX:STA)

The company released its Sustainability Report for 2021, outlining its commitment to the United Nations Sustainable Development Goals (UNSDGs).

STA said it’s focused on managing development risks at its Coburn project in WA to safeguard workers and ensure environmental compliance.

Lithium Power (ASX:LPI)

The company has appointed global consulting firm Deloitte to ensure a robust ESG program at its Maricunga project in Chile.

Deloitte has been tasked to imbed sustainable protocols in LPI’s lithium extraction operations, and to establish ambitious standards for LPI to become a carbon neutral producer, while keeping high standards on the social aspects.

Jadar Resources (ASX:JDR)

The company also said it has completed its maiden Sustainability Plan, with strategies aligned to the UNSDGs.

 

The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.

Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.

The post The Ethical Investor: ESG moves, lessons from the energy crisis and JP Equities’ stock tips appeared first on Stockhead.




Author: Eddy Sunarto

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Emerita Sees Continued Success In Spain

Emerita Resources Corp (TSXV:EMO) continues to report excellent results from the Infanta drill program at its Iberia Belt West Project
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Emerita Resources Corp (TSXV:EMO) continues to report excellent results from the Infanta drill program at its Iberia Belt West Project in Spain, which hosts three previously identified high-grade deposits: La Infanta, Romanera and El Cura. These are all open for expansion along strike and at depth.

On October 22, the company announced assays for the first step-out drill hole from the Infanta drill program and also the final in-fill drill holes. The significance of the in-fill program was to verify the historical drill results. They will now enable a proper 3D modelling of the deposit and will also provide additional data to be used for future metallurgical testing.

At Infanta, the step-out was conducted to expand the outer perimeter of the deposit, and the in-fill drilling was intended to confirm historical drill data within Infanta’s known mineralization zone. Step-out drill hole IN018 was drilled 40 metres to the west of the historical limits of the deposit and intersected 8.2 metres with a grade of 2.5% copper, 8.7% lead, 17.3% zinc, 223.5 g/t silver and 0.5 g/t gold. A second step-out hole was drilled 50 metres to the west of hole IN018 and intersected two zones of massive sulfide but assays have not been returned yet.

In-fill drill hole IN014 intersected 5.7 metres of 2.4% copper, 7.3 %lead, 13.4% zinc, 225 g/t silver and 0.6 g/t gold. The ongoing geophysical survey, which was suspended along with other exploration activities for the region’s hunting season, is expected to resume by the end of October.

Emerita plans to have five drill rigs operating by the end of 2021 and will include the Romanera deposit, El Cura, and other targets identified by previous geophysics work. The two drills currently on site will now focus on step-out drilling to increase the size of the deposit.

Emerita also recently provided investors with an update on the legal proceedings for the Aznalcóllar Project and the company is expecting a ruling by the Administrative Court of Andalucia in Emerita’s favour in the near future.

The Aznalcóllar Zinc Project is located in the prolific Iberian Pyrite Belt in the Andalusia region of southern Spain and is considered to be one of the world’s largest and most productive volcanogenic massive sulfide (VMS) structures. It has been mined for over a thousand years and has produced over 2000 million tons of ore.

Aznalcóllar is considered to be one of the world’s top undeveloped zinc deposits, and the project is essentially a world-class pre-production development asset. Here, the main deposit is referred to as Los Frailes, which contains a historical open pit mineral resource. Two other deposits exist on the property as well, which require further development. The Los Frailes mine operated during the 1990s until it closed due to a combination of tailings-related environmental failure and low metal prices.

After the Aznalcóllar site was rehabilitated, the government initiated a public tender process for the rights to the project and it was initially awarded to another major mining company, however Emerita believed that their bid was superior. It subsequently requested an investigation into the tender process for the property and filed a lawsuit in 2015.

In early 2021, the Spanish court concluded that the process was fraught with corruption, fraud and other malfeasance and rescinded the rights that were awarded and criminal charges were sought for the perpetrators and their enablers. In July 2021, a Spanish judge issued additional criminal indictments against the mining company and government officials who participated in undermining the public tender process for the project.

Under Spanish law, if a crime was committed during the tender process, the rights are then awarded to the next best qualified competing bid, which in this case was Emerita. Subsequently, Emerita has been waiting for the Administrative Court to conclude the process to formally award the rights to the Aznalcóllar Project to the company, which brings us to present day.

The company is planning to develop the deposit into an underground mining operation focused on mining the high-grade zones, which are estimated to contain 20 million tonnes at a grade of 6.65% zinc, 3.87% lead, 0.29% copper and 84 ppm silver. As a requirement of the project’s public tender process, Emerita submitted comprehensive. engineering, environmental and water management studies to the government, and now the company is expecting to be given the green light to proceed developing the Aznalcóllar project into an eventual producer.

Emerita is well financed, having completed a $20 million bought deal private placement in July 2021. Emerita has 182.42 million shares outstanding and due to the recent increase in the Company’s share price, a market capitalization now of $556.38 million. Even so, barring any unforeseen negative developments regarding the legal issues, Emerita Resources Corp still appears to be potentially undervalued relative to the potential value of the world-class assets it is developing.

Shares of Emerita Resources Corp last traded at $3.05.


FULL DISCLOSURE: Emerita Resources is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Emerita Resources on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.

The post Emerita Sees Continued Success In Spain appeared first on the deep dive.







Author: Phil Gracin

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