Chieftain Chatter
Season 5
Episode 182
I have an interest in UFC as a good mates son is the current welterweight world champion so was interested to read that Paramount Skydance just acquired the US rights for 7 years for US$7.7b dwarfing the previous contract held by ESPN. Now, hopefully this arrangement holds Jack in excellent stead to negotiate a deal that means he can give the sport away with his faculties in place and happily sun his arse in the Bahama’s. Anyway, phenomenal deal and Paramount shares rocketed 37% on the news. This brings to an end the current “pay for view” arrangement in favour of streaming on Paramount+ for subscribers. Skydance Media only recently acquired Paramount for US$8 billion and then paid this amazing figure to screen the UFC in the US only for 7 years. Let’s just hope the heroes of the sport get their just deserts!
The share markets response following the release of inflation numbers in the US last week was euphoric. The July CPI came in at 2.7% for the year which was below the 2.8% rise expected while core inflation (minus Food, energy) did creep up to an expected 3.1% from 2.9%. This still leaves the door wide open for the Fed to cut rates in their September meeting with the odds now increasing to 94% from 85%. The bottom line is although there is still an inflationary impact of tariffs creeping in, they are not at alarming levels and the Bureau of Labour Stats was quick to point out this result was in line with economists’ expectations after Uncle Don fired the last commissioner following a report of deepening unemployment. So even though the rate was within expectations it’s getting closer to breaking out of the Feds 2% target after getting down as low as 2.3% in April this year indicating that tariffs are indeed having an impact on pricing and the pace of the overall US economy. Surprisingly, the Producer Price Index (PPI) stats that followed the CPI numbers didn’t dent analyst’s expectations for a rate cut despite exceeding expectations. July PPI rose 0.9% in the month of July when a 0.2% increase was expected.
I’m sure heads will roll (literally) at China’s largest EV battery manufacturer CATL after they took the market by surprise suspending lithium production at their Jiangxi province mine for at least 3 months. Apparently, the failure to renew their recently expired mining permit was the reason for the mine halt and hence they are in negotiations with the government to have it re-issued. The mine accounts for about 3% of global production and the news certainly put a rocket under lithium stocks across the board. Beijing has been scrutinising mining operations across a range of commodities looking to put a halt to overcapacity. CATL saw revenue from its battery mineral resources business plummet 29% in 2024, a drop that underscores challenges facing the CATL’s upstream investments including a precipitous decline in lithium prices. These were originally intended as a way of securing supply and managing costs, and CATL had aggressively pursued mining stakes, even overseas.
The shorter’s have been having a field day with our ASX out of favour, capital hungry resources sector with the lithium and uranium names still at record short position levels. In particular our biggest lithium names have been torched by the Asian Hedge Funds who have borrowed in excess of $2 billion of stock and sold. However, the shock of CATL stalling production for a short period highlights the inherent risk of such a trade. According to JP Morgan estimates this disrupts about 50,000 tonnes of production or 3% of the global lithium carbonate production and highlights it doesn’t take much to turn sentiment towards a commodity in either direction. Those lucky enough to participate in the Liontown Resources (ASX:LTR) $316m capital raise at 73 cents saw a 30% appreciation overnight in the value of their investment. Now, this small supply shock may not last and may well be covered by CATL’s stockpiles and it’s hard top see how such an industry giant can be sidelined for too long by the authorities. However, should the Chinses government remain focussed on curtailing over supply this may just be the start of their activities to curb CATL and other’s from flooding the market.
Quote of the week….
“Because we didn’t take rates as high as some other countries, it may be that we don’t need to reduce rates as much either, as demand and potential supply in the economy get closer to balance and inflationary pressures ease…... “The neutral rate is something that is a long run concept,” she explained, “In the absence of shocks. And we are very often not in the absence of shocks. Our estimates are somewhere between 1 and 4. It’s a very wide range. We don’t put a lot of emphasis on the neutral rate in terms of thinking.” …. RBA Chief Bullock.
On the lighter side….
School of hard rocks…
Post the avalanche of Diggers newsflow it was a little sparse this week….so a few stocking fillers in here…
Orezone Gold Corp (ASX:ORE) quietly commenced trading on the ASX following the raising of $75m at $1.14 and debuting on market at $1.22 and closing at the same price on very light volume. The proceeds of the raise will be used for advancement of the Stage 2 Hard Rock expansion at their Burkina Faso Bombre Gold project. ORE also released their second quarter production result producing 27,548 ounces at an AISC of $2,860 and sold 28,265 ounces at $5,220 generating just under 150m Aussie Rubels in the process. This leaves ORE with $113m in cash and debt of $102m. On the development front their stage 1 hard rock expansion to 2.5mtpa is over 60% complete with commissioning in Q4-2025 and they are forecasting 170,000 to 180,000 ounces of production in 2026. Stage 2 expansion to 5.5mtpa has been approved and will be commissioned in Q4 2026 taking annual production to 220,000 - 250,000 ounces per annum in 2027.
Minerals sands up n comer Petratherm (ASX:PTR) provided an update on their Muckanippie Project located in the northern Gawler Craton of South Australia. PTR has reported thick, high grade shallow drill intersections covering an area of some 20km2 that remains open.
Part of the Rosewood Titanium project is located on a tenement held by Narryer Metals (ASX:NYM) and in line with their joint venture agreement PTR has met the hurdle to acquire an additional 19% of the project taking them to 70%. PTR have in return notified NYM that they wish to form a joint venture. A further drilling program is planned at Rosewood in September to move towards a maiden JORC Resource and they will also follow up other key sediment-hosted mineral sands targets (some of which are in the JV tenement EL 67175) and test the extensions to the current mineralisation. Could be a marriage made in heaven!
Duketon Mining (ASX:DKM) has received some strong assay results from its inaugural RC drill program at its Killarney Gold Project near Mt Magnet when testing beneath a shallow pit and a soil geochemical anomaly.
Better results from the initial 17 hole program returned:
10m @ 2.33g/t Au from 32m
9m @ 4.64g/t Au from 54m
9m @ 2.12g/t Au from surface
7m @ 3.45g/t Au from 29m
They will drill ahead with the $12m in cash and investments as it remains open along strike and depth. Early days for this project but given it’s location and mining lease status it could readily be converted into profitable ounces.
Cygnus Metals (ASX:CY5) has identified some significant new drill targets at their Quebec based copper-gold project with the long name. The targets were identified using the latest A1 technology to conduct a review of historical data both inside and outside the current resource.
Meanwhile drill results from Cedar Bay returned:
4m at 16.8% CuEq (4.8% Cu, 15.2g/t Au & 23.3g/t Ag);
9m at 9.6% CuEq (8.4% Cu, 1.0g/t Au & 43.0g/t Ag).
These occurred outside the existing resource and remains open while at Corner Bay the final infill results have been received which will feed into their resource upgrade next month including:
3.5m @ 4.9% CuEq (4.2% Cu, 0.5g/t Au & 27.3g/t Ag)
1.8m @ 7.7% CuEq (6.3% Cu, 0.9g/t Au & 45.9g/t Ag)
The project has the added advantage of a 900,000 tonne per annum processing facility with accompanying nearby infrastructure to potentially process ore from the many advanced copper/gold projects in the region.
Beacon Minerals (ASX:BCN) reported results from grade control spaced drilling at its Iguana deposit, part of its Lady Ida development project. The first results from some 2,970 assays have been received with better results including:
5m at 39g/t from 49m
6m at 47g/t from 32m
2m at 39g/t from 41m
8m at 4.3g/t from 33m
7m at 3.6g/t from 47m
These results were located on the northwest edge of the grade control pattern, with mineralisation not yet closed out to the north. These shallow high-grade intercepts are significantly higher grade than the current Iguana resource. The new mineralisation defined in the Northwest Corridor shows potential for further resource expansion to the north and at depth and hence BCN is planning deeper RC drilling to follow up on these intercepts.
Lindian Resources (ASX:LIN) have received stage 2 mining licence expansion approval for their Kangankunde Rare Earths Project in Malawi thus enabling a potential production increase from Stage1 target of 15,300 tonnes per annum of Monazite Concentrate up to approximately 75,000 -100,000tpa. The expansion of their mining license substantially increases the potential mining footprint from 900 to 2,500 hectares and thus supports a production expansion over which Iluka Resources (ASX:ILU) has the right of first refusal over i.e. 25,000 tpa for 15 years.
As part of ILU’s stage 2 offtake they must provide 50% of the debt funding to fund the capital cost of the expansion. LIN will now advance to finalise stage 1 financing and FID with construction expected to commence early next year and first concentrate production late in calendar 2026.
Southern Cross Electrical Engineering (ASX:SXE) has announced that two of their subsidiaries have received a range of contracts totalling over $110m including:
4-year extension under existing inspection and services agreement with Energy Queensland Limited, the second time this contract has been renewed through SXE
New Master Services Agreement in place by Newmont Mining, for the provision of electrical and shutdown labour support at Boddington for 5 years.
Trivantage has been awarded a contract by We Build for switchboard and communications works at Sydney Metro / Western Sydney Airport, with staged deliveries through FY2026.
Trivantage has been awarded a contract from FIP electrical for switchboards and distribution for a development in Sydney’s Darling Harbor, which will be supplied throughout FY2026.
The contracts continue to build SXE’s pipeline of works which will be converted into revenues in time, with the national electrification theme clearly providing the potential for consistent contract wins, where SXE’s offering particularly with its various subsidiaries positions it well to take advantage of this.
Titan Minerals (ASX:TTM) released results of resource definition drilling at their 100%-owned Dynasty Gold Project in Ecuador. Their ongoing 6,000 metre program is targeting infill between the two areas of the resource to expand their 1.9m ounce Cerro Verde gold resource as part of the global 3.1m ounce Dynasty inventory. These results include a multiple zone intercepts from outside the current mineral resource including:
31m @ 2.2 g/t Au, 5.4 g/t Ag from 71m
18m @ 1.4 g/t Au,9 g/t Ag from 145m
23m @ 1.4 g/t Au, 4 g/t Ag from 173m,
4m @ 2.1 g/t Au, 6.1g/t Ag from 274m
TTM has 3 rigs banging away at Dynasty with resource definition activities to be completed over the coming months in preparation of the next resource update, due this calendar year. TTM’s Linderos Project in joint venture with Hancock Prospecting continues with delineation drilling of a large-scale copper porphyry system with results expected soon. The company had cash at the at the end of June 2025 of US$9.1m (A$13.8m) and thus is well-funded for ongoing exploration.
Who’s shaking the tin…
AXP Energy (ASX:AXP) - $2.7m at $0.001(plus 1:3 option)
Green360 Technologies (ASX:GT3) - $4m at 2.2 cents
Litchfield Minerals (ASX:LMS) - $500k at 10 cents (plus 1:2 option)
Everest Metals Corporation (ASX:EMC) - $4m at 10.5 cents
Dalaroo Metals (ASX:DAL) - $877k at 2.5 cents (plus 1:3 option)
GTI Energy (ASX:GTR) - $4.5m at $0.0035
Waratah Minerals (ASX:WTM) - $30m at 57.5 cents
Benz Mining (ASX:BNZ) – $30m at 98.5 cents
Centaurus Metals (ASX:CTM) - $20m at 36 cents (plus 1:2 option)
Paterson Resources (ASX:PSL) - $2m at
Kula Gold (ASX:KGD) - $750k at $0.0065
Falcon Metals (ASX:FAL) - $15m at 57 cents
Siren Gold (ASX:SNG) - $4m at 5 cents
Dart Mining (ASX:DTM) - $2.86m at $0.0017 (plus 1:2 option)
Somerset Minerals (ASX:SMM) - $4m at 1.3 cents
WA Resources (ASX:WA1) - $100m at $17
Lake Resources (ASX:LKE) - $10m at 3.6 cents (plus 1:2 option)
A coffee with....
Mark Strizek, Executive Director Aurum Resources (ASX:AUE)
We have known Mark for a while now and consider him to be a straight shooter with minimal BS. He was previously at Tietto (TIE) with Caigen Wang which went from IPO in Jan2018 to first gold production in 2023 before being taken over by Zhojin for $768m in 2024 – an outstanding effort. So AUE is really about getting the old band back together with a very similar strategy that was so successful at TIE. That is drill the shizen out of the prospects with company owned rigs so that every dollar goes further and acquire ground close to existing resources etc. It’s key project is Boundiali located in the north of Cote D’Ivoire (or as I like to call it... the Switzerland of Africa!!!) The project is within 70km of both the Tongon mill owned by Barrick and Perseus Mining’s (PRU) Sissingue project. Since acquiring the project in 2023, it has increased the resource to currently stand at 2.41moz of this some 600koz is in the Indicated category with the balance in the inferred category. The resource is made up from six different projects. In Oct’24 AUE announced a recommended deal to acquire Mako Gold (MKG) via scrip for total consideration of ~$18m. Mako had the Napie project with a resource of 868koz @ 1.2 g/t Au and located approximately 120km away. The project covers 224 sqkm with the resource located along the Napie shear, however, only 4.4km of the total 30km long shear zone has been systematically tested. The maiden drilling program commenced in June with the aim to drill along the gaps in the shear zone and also to the north where it appears there are some artisanal miners over +1km of strike. We would expect initial results from this drilling in September. On the corporate front, AUE completed a $35m strategic placement to the Lundin Family (9.9%) Zhaojin Capital (8.5%) and Montage Gold Corp (9.9%) vis issue of approximately 2.9m Montage Shares. Montage Gold is an interesting company, backed by Lundin Family and Zijin group they are building the Kone project – located 125km from Boundiali. Kone is slated to produce ~300koz per yr for the first 8 yrs of a 16yr mine life with AISC of US$1,059/oz with capex of US$835m based on a 11mtpa plant with a grade of a modest 0.7 g/t Au. So, it’s not too hard to imagine that should AUE find zones of higher-grade ore at Boundiali than it will come into M&A focus. So, AUE has a market capitalisation of ~$190m with $40m in cash and investments and a global resource of 3.28moz which appears light on in comparison to many of its peers trading at a EV per ounce of ~$50/oz and clear room for this resource to grow to +4moz. The stock has languished a bit as Mako shareholders have sold into the more liquid larger company which we think provides a pretty good opportunity.