News - Fitzgerald Articles

Plus, Red 5 makes a strong start to life as a WA gold miner

It is a case of back to the future for billionaire mining entrepreneur Robert Friedland’s ASX-listed Clean TeQ (ASX:CLQ). In the past two years, Clean TeQ – owned 16.3% by Friedland and 16% by China’s Pengxin Mining – has been something of a tearaway success, growing from $70m to the $800m-plus company it is today, headed as it is towards nickel and cobalt sulphate production for the lithium-ion battery market from its Syerston deposit (recently renamed Sunrise) near Condoblin in central NSW.

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Plus, this column’s instincts about emerging mineral sands miner Strandline are shaping up as spot on and Stavely gets to the pointy end of its hunt for a copper-gold porphyry in Victoria

Former uranium producer Alliance Resources (AGS) is making a good fist of being a gold explorer. So much so that just 30 months after the start of embarking on its new life as an explorer for the yellow metal, it is likely to publish a maiden resource later this year for its flagship project, the Wilcherry project, 40km north of Kimba in South Australia’s Gawler Craton.

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New Century Zinc and Venturex among those in the cold, with share prices lagging analysts’ forecasts

The 10-year high in zinc prices has not amounted to much in the local market for the near-term developers. While the established and new producers have been rewarded with strong share price gains in response to their higher earnings, the developers have been left out in the cold. Because they are not yet in production, the argument goes that a 10-year-high metal price of $US1.55 a pound – it compares with the 2016 average of US95c and the 2017 average of $US1.29 – means nothing for them.

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Plus, little Stavely awaits drilling results in its hunt for a big copper-gold discovery

Gold’s against-the-odds push through $US1,300 an ounce fuelled a massive re-rating of the gold producers in the past couple of months. So much so that the hard-nosed types in the market reckon the leading gold producers have become too expensive on a net present value basis. None of that means much if gold continues to build above $US1,300 an ounce. But the very same reasons why gold wasn’t meant to get there in the first place (expectations of rising US rates and a stronger US dollar from tax reform) have not gone away.

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Plus, Genesis working its way on to the M&A radar as drilling highlights gold project development potential

On face value, last week’s acquisition by Bill Beament’s Northern Star juggernaught of a 16.4 per cent stake in Echo Resources (80 million shares at an average price of 29c each) was no big deal. Northern Star’s Jundee mine sits at the northern end of the Yandal belt in Western Australia and Echo has its foot on the southern end, with its currently-mothballed Bronzewing treatment plant its centrepiece.

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Plus, Flanagan outlines Battery Minerals’ low-cost, fast-track route to graphite production and cashflow

Breaker Resources’ (BRB) executive chairman Tom Sanders reckons that the 50c stock is dirt cheap. The “Colonel” said as much when addressing more than 400 investors yesterday at the Brisbane leg of Resources Rising Stars’ “Summer Series”. There is nothing unusual in that kind of statement being made by a company man, particularly when the company involved is “laying the foundations for a large new greenfields gold mine, 100km from Kalgoorlie”.

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Plus, Encounter dangles the carrot with results imminent from drilling near Telfer and the prospect of news on its alliance with Newcrest

Mineral sands prices have bounced back from the pummelling they took between 2013-2016. The 40% share price gain for the industry leader in this market Iluka since March is ample demonstration of the recovery underway. Zircon is in tight supply, with Iluka having announced a couple of reference price increases during the year. Prices have also improved for rutile but the urgency for restocking by the pigment end users is not as severe.

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Plus, unloved Cassini tipped to bounce back as investors digest Oz Minerals deal

Plenty of CEOs think their company’s shares are undervalued. Some have a point, most don’t. Mel Palancian, managing director of the ASX’s only pure (producing) zinc play, Red River (RVR), is in the former category, and he made his case at the Melbourne Mining Club’s Cutting Edge series during the week. There was some emotion to it too, with Palancian saying he feared a low-ball takeover bid as he sees a lot more value for shareholders than the current $135m market capitalisation (28c a share) implies.

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