Chieftain Chatter
Back Peddlin…
As quick as his threats emerge, they are retracted and there was no greater evidence of this last week when he switched his short-term focus to the Federal Reserve. Specifically, his target was Chairman Powell than publicly accusing him of not moving fast enough to cut rates and even suggesting they may bullet him. Trump claimed the economy would slow unless Powell who he referred to as “Mr Too Late, a major loser” lowered interest rates immediately. Within a couple of days, he insisted he has no intention of disposing of the Fed Chairman despite his frustration with the supposedly independent central banks move to lower rates despite posting “Powell’s termination cannot come fast enough!.” Most of the Feds members are publicly very comfortable with current policy settings and waiting for the economy to ease in the wake of persistent inflation. Pre tariffs the economy was cooling and thus justifying the Feds 1% cut in late 2024 but with their focus clearly on taming inflation the implementation of tariffs has only served to justify their current position.
His resolve has also started to waiver towards China indicating he would be willing to substantially wind back tariffs if China agree to engage in negotiations.
His back flip followed a series of meetings with heavyweights such as Walmart, Home Depot and Target who emphasised not only the price impact of tariffs but also the impact on supply chains.
It was speculated last week that they were considering a proposal to cut tariffs on Chinese imports to a range of between 35% to100% depending on which way the wind was blowing but 35% on goods not considered critical for national security and 100% on those that are.
Beijing’s response has been a willingness to come to the table with a foreign ministry spokesman commenting “China's attitude towards the tariff war launched by the U.S. is quite clear: we don't want to fight, but we are not afraid of it. If we fight, we will fight to the end; if we talk, the door is wide open," Regardless, the early impact of the trade war was evident when it emerged China has already reduced many US imports with LNG and wheat imports almost non-existent in March when last year the US accounted for 17% of China’s wheat imports and 5% of LNG. In addition, imports of US cotton fell 90% from this time last year.
These machinations have only served to increase market volatility in both directions with the changing rhetoric from the White House (Don). The overall bearish sentiment continues to reign with in excess of 50% of investors erring towards a continued negative outlook for markets which is at levels not seen since the 1987 stock market crash. The softer stance from Trump has seen some of the edge taken off the “sell America” trade and hence some support for the greenback and a pairing back of US bond yields…for the moment!
Copper prices continued to rebound over the week as it became evident that the simple supply/demand fundamentals cannot be ignored with copper inventories plummeting to five tear lows on the Shanghai Futures Exchange.
A potential tariff induced buying spree was largely to blame as stockpiles fell by 43,000 tonnes. Shorter-dated copper contracts rallied aggressively in a hallmark sign that spot demand for copper is picking up in the broader international market.
The LME’s main contract for April delivery traded at a premium of as much as $50 to those expiring in May, (backwardation) which is a key indicator of rising demand.
Quote of the week….
"the fundamentals are better now than I've ever seen them in 50 years,"
Nuclear Fuels expert Dustin Garrow summarises from his five decades of experience.
On the lighter side….
School of hard rocks…
Genesis Minerals (ASX:GMD) reported 60,000 ounces of quarterly production at an AISC of $2,323 and gold sales of 59,000 ounces at $4,500 per ounce.
This added just under $100m to the coffers leaving them with $321m (no debt) after exploration, growth capex and royalty spend of $26m. Guidance has been maintained at 190,000 to 210,000 ounces at AISC of $2,200 to $2,400.
GMD released a 12% upgrade in reserves to 3.7m ounces @ 2.1 g/t which should underpin their accelerated growth plans and see them well on track to achieve their aspirational 400,000 ounce per annum production target.
The feud between Barrick Gold (TO:ABX) and the Mali government appears to be far from over with Barrick confirming the Malian authorities have closed the company’s office in the capital Bamako.
They also warned it would place Barrick’s Loulo- Gounkoto mine under provisional administration unless the mine was reopened and tax payments were made, Barrick said in a statement.
The Govt. is demanding back payments and adherence to the new mining code that gives Mali a larger stake and royalties in the Loulo-Gounkoto mine which is one of Barrick’s biggest mining operations.
“It’s regrettable that the government continues to obstruct gold exports while simultaneously demanding tax payments on revenue it has actively prevented them from realising,”
according to the statement.
It’s that time of year again when the super major miners are circling each other with the latest scuttlebutt suggesting Rio Tinto (ASX:RIO) and Glencore (LSE:GLEN) are in merger talks which will probably amount to nothing as no senior executive wants to give up their fat salary package.
For context by market cap RIO is the second largest of the global miners at about $150 billion and Glencore are around $80 billion while the much publicised BHP/Anglo American tie up may gather legs again this year with the motivation believed to be both BHP and Rio’s desire to add significant copper production to their portfolios in the midst of declining iron ore demand. Unfortunately for Glencore their share price is down 30% this year while Rio are only off 6% making a potential palatable deal difficult to satisfy both groups of shareholders. The machinations of a potential deal and the resulting spin out of assets could take many forms.
Greatland Gold (LSE:GGP) has released it’s first full quarter of production operations from Telfer post acquiring it from Newmont Gold (ASX:NEM) for US$475m .They produced 90,000 ounces of gold and 3,500 tonnes of copper for the quarter at an AISC of $2,126 per ounce which is running lower than expectations and lower than historical performance at Telfer. Guidance for FY2025 of 196,000 to 210,000 ounces at AISC’s of $2,100 to $2,250 per ounce and remains on track if they deliver somewhere between 76,000 to 90,000 ounces while growth capital will be in the region of $95-105m. However worth keeping in mind GGP are largely treating stockpiles mined by the previous owners which are being drawn down and will ultimately switch back to running the plant at 50% capacity. GGP added $253m in cash taking their cash balance to $398m putting it in a nice position to pursue M&A to supplement ore feed with Antipa Minerals (ASX:AZY) being the obvious choice with 50m tonnes @ 1.5 g/t sitting a mere 50 clicks away which maybe another motivation for GGP’s ASX listing mid-year. They have also updated the nearby Havieron development option and are considering an expansion from 2.8mtpa to 4-4.5mtpa.
How much gold doth one want before someone takes, thou out? Well, in the case of Predictive Discovery (ASX:PDI) it seems their now inventory of 103.6m tonnes @ 1.66g/t Au for 5.53m ounces at their Bankan Gold Project in Guinea is not enough. PDI released an incremental maiden inferred resource at the Argo area of 3.1m tonnes @ 1.54g/t Au for 153,000 ounces. Argo lies a mere 15 clicks from the main Northeast Bankan deposit (4.9m ounces) and still remains open at depth and strike with further drilling planned. 55% of the total resource or 3.05m ounces sits in the reserve category and surely many must be running the ruler over this potential 270,000-ounce annual operation at an AISC of $1,770 for 12 years which is forecast to cost in the vicinity of $700m to develop. PDI are well funded for future drilling, permitting and DFS with $98m cash at bank. They also announced further results from the small Sounsoun deposit (currently 34,000 ounces) indicating significant resource upside potential with better results including:
26m @ 6.74g/t from 81m
6m @ 0.73g/t from 26m
20m @ 0.94g/t from 57m;
9m @ 1.20g/t from 20m
3m @ 4.41g/t from 66m;
10.25m @ 1.45g/t from 31m.
With global miners having an insatiable appetite for copper, local ASX junior Prospect Resources (ASX:PSC) were the beneficiary of an injection of capital from copper giant First Quantum (TSX:FQM). FQM have injected $15.2m for a cornerstone 15% stake in PSC at 15 cents per share which represents a 36% premium to their recent share price. In addition, First Quantum will assist with future exploration of Prospect’s Mumbezhi Copper Project as a key technical partner, supporting Prospect’s exploration team. The Sentinel Copper Mine (100% owned by First Quantum) is located approx. 25km northwest of Mumbezhi, within the world-class Northwestern Zambian Copper Belt. Prospect has also entered into a placement agreement with long-term substantial shareholder, Eagle Eye, subject to receiving shareholder approval, to raise approx. A$2.8 million in new equity proceeds, at an issue price of A$0.15, which will allow Eagle Eye to maintain its existing 15.3% shareholding in Prospect. Together, the placements to First Quantum and Eagle Eye will facilitate Prospect raising up to a total of approx. A$18.5 million leaving PSC well-funded to further accelerate exploration and advancement of Mumbezhi, with Phase 2 drilling set to commence during Q2 2025.
Wia Gold (ASX:WIA) continues to produce strong results from a recent program of 7,000 metres plus of primarily infill drilling at their Kokoseb gold project in Namibia.
Better infill results included:
10m @ 8.03g/t Au from 126m
40m @ 1.29g/t Au from 81m
25m @ 3.28g/t Au from 104m
22m @ 4.31g/t Au from 72m
23m @ 2.18g/t Au from 115m
Significant results outside the resource area included
17m @ 3.31g/t Au from 238m
10m @ 1.68g/t Au from 186m
These results will support an upgrade of a portion of the inferred resource to Indicated while the overall resource base should continue to grow with mineralisation remaining open at depth and along strike.
Drilling continues with five rigs hammering away on 45,000 metre program which includes 3 diamond rigs focussing on the deeper high-grade shoots.
The existing 2m ounce resource at a gram has plenty of upside potential with an update due mid-year and a scoping study to follow with about $30m also in the kick.
Cygnus Metals (ASX:CY5) has intersected a high-grade gold hit at the Golden Eye target within the Chibougamau Cu-Au Project in Quebec with assays still pending from an additional 5 holes:
3.3m @ 6.6g/t Au from 132m
The company intends to utilise their drilling within excess of 21,000metres of historical drilling to delineate a resource estimate in the near future.
Historical results included:
5.9m @ 32.2g/t Au, 1.2% Cu & 27.3g/t Ag
4.5m @ 14.9g/t Au, 4.7% Cu & 54g/t Ag
8.4m @ 11.0g/t Au, 1.3% Cu & 15.8g/t Ag
7.5m @ 16.0g/t Au & 4.7% Cu
10.4m @ 7.3g/t Au, 3.5% Cu & 31.8g/t Ag
The Nedlands golfer commented “Gold is a major part of the production history in the Chibougamau district. It is more than just a by-product, with production of 3.5Moz at an average grade of 2.1g/t Au. We already have 248,000oz of gold in Inferred Resources and 66,000oz in Measured and Indicated Resources, and there is significant opportunity to add to these at Golden Eye with early high-grade results and visible gold down dip. “Golden Eye is fairly unique at Chibougamau in having a significantly higher proportion of gold than copper and was identified by the team early as an excellent gold-dominant drill target. We have a good head start by having the historic drill logs and will utilise this recently compiled data to assist in an initial Mineral Resource for Golden Eye’’.
Elixir Energy (ASX:EXR) received a much needed injection of energy with the appointment of former Strike Energy (ASX:STX) boss Stuart Nicholls to CEO & MD. Stuart was surprisingly rissoled by the STX board who have not fired a shot since his departure other than a dry hole and promise of some “strategic review.” EXR has a dominant position in the Taroom Tropugh in Queensland which has multy tcf potential and has the attention of Shell who are believed to be accelerating their activities. EXR also recently expanded its footprint in the trough with the establishment of two 50/50 joint ventures with Santos (ASX:STO) with Elixir to operate and drill a vertical appraisal well in ATP 2056 at its cost (and Elixir will also carry Santos through a 200km 2D seismic program in ATP 2057).
Who’s shaking the tin…
Benz Mining (ASX:BNZ) - $13.5m at 40 cents
Boatanix Pharmaceuticals (ASX:BOT) - $40m at 33 cents
Aruma Resources (ASX:AAJ) - $900k at $0.0085 (plus 1:1 option)
Robex Resources (ASX:RBX) - $120m at $3.13
Galan Lithium Limited (ASX:GLN) - $10m at 11 cents
Asra Minerals (ASX:ASR) - $3m at $0.002 (plus 1:1 option)
Prospect Resources (ASX:PSC) - $15.2m at 15 cents
Dateline Resources (ASX:DTR) - $1.4m at $0.007 (plus 1:2 option)
Nordic Resources (ASX:NNL) - $2.85m at 6 cents
TMK Energy (ASX:TMK) - $2.2m at $0.0032
Aguia Resources (ASX:AGR) - $3m at 5 cents
Lincoln Minerals (ASX:LML) - $ $231,550 at $0.005
Ardea Resources (ASX:ARL) - $4.6m at 43 c3nts
Orpheus Uranium Limited (ASX:ORP) - Raising $1.25m at 2.8c
Sunrise Energy Metals (ASX:SRL) - $7.5m at 30 cents (plus 1:1 option)
Somerset Minerals (ASX:SMM) - $2.4m at $0.009 (plus 1:2 option)
Mount Burgess Mining (ASX:MTB) – $54,743 (yes 50 grand!) at $0.0045
Tesoro Gold (ASX:TSO) - $ 11m at 2.4 cents
Strickland Metals (ASX:STK) - $5m at 9.1 cents
Pilot Energy (ASX:PGY) - $5m at 1 cent
Botala Energy (ASX:BTE) - $1.25m at 5 cents
Trek Minerals (ASX:TKM) - $3.5m at 5 cents
Terrain Minerals (ASX:TMX) – $735k at $0.003 (plus 1:1 option)
Power Minerals (ASX:PRR) - $1m at 6 cents (plus 4:5 option)
Freehill Mining (ASX:FHS) - $700k at $0.004 (plus 1:2 option)
A meeting with…
Charles Hughes, CEO of Gorilla Gold Mines (ASX:GG8)
We have only known Charles a few years when he was in charge of exploration at Delta Lithium (ASX:DLI) and successfully drilled up their resource at Mt Ida (gold) and Yinnetharra (lithium). He joined Gorilla, which was previously called Labyrinth Resources (ASX:LRL) in Sept’24 after LRL entered a deal to acquire the Comet vale project and Vivien project (previously mined by RMS) from well known and highly regarded resource entrepreneurs in Alex Hewlett and Kelvin Flynn (previously DLI and Spectrum Metals, WC8). The strategy was to consolidate and grow underexplored high grade gold mines across the Menzies, Leonora and Leinster corridor that are close to infrastructure. LRL already had a 51% interest in Comet Vale so this deal enabled it increases its interest from 51% to 100%.
With a successful track record the company was also going to get a strong following with capital easily raised and drilling started in earnest. Whilst initial results were encouraging it was really the maiden drill program from Lakeview that set the market alight – as Charles was saying in the pyramid/triangle of opportunities, Lakeview would have been in the lower rung of projects – i.e. interesting target that requires drilling. First pass results from Lakeview returned some cracking intersections including 19m @ 18.1 g/t Au from 80m, 11m @ 24.8 g/t Au from 145m and demonstrating a strike of the mineralised system to over 400m. Further drilling continued to grow the mineralisation with a 24m @ 10.3 g/t Au from 200m extending the strike of mineralisation by 125m and other intercepts of 40m @ 4 g/t Au from 128m and 22m @ 6.8 g/t Au. Not surprisingly Lakeview has shot to the top priority – currently 2 RC rigs on site with plans on bringing in a Diamond rig that can drill low angle holes – the terrain is fairly rugged, so access is not easy. Our ‘back of the napkin’ estimate reckons they probably already have at least 300-500koz @ 4-5 g/t Au which is terrific start. GG8 is also drilling away on its other prospects at Mulwarrie – 3 rigs and came out with a maiden Vivien resource of 278koz @ 4.1 g/t Au with some 86koz in an open pit.
The company is well funded having raised $25m @ 38c in March giving it a market capitalisation of ~$300m so it’s not in the cheap category but with gold >A$5,000/oz and a new emerging high grade gold discovery we sense this can continue to track upwards.