public holiday nearly everywhere today…
Liontown - have announced some excellent drilling results from their flag-ship lithium project in Western Australia - long intersections of 20-30m with 1,4-1,5% lithium ( the best hole in fact was the best ever drilled 52m with 1,4% ) These results moved the companies exploration target to between an additional 19- to 31 mill t at the same grade as the current resource of 21 millt at 1,4% - so they expect the resource to double from current levels. That would be a globally significant resource! The company will conduct more drilling until early/mid Jube, follwoed by a new resource estimate a few weeks later. Also, next week LTR will drill the second project, Buldania again, which is hard on the heels of the first project in terms of size. LTR hat 6 mill$ left at the end of last Quarter, and intends to spend 3 mill$U this Quarter. After that, I guess will stop drilling and continue metallurgical work, which is ongoing and should take up to 6 month, and will continue to advance the project by finishing a pre-feasibility study in the 4th Quarter.Cash might be getting tight from August or so - but at least, tehy are spending it very wisely!LTR are the best lithium explorer in my opinion - but lithium prices are currently quoted at only 650 US$/t for spodumene. At that price, the project has an estimated NPV8of 400 mill$, based on the existing 21 millt of resources. There is plenty of upside in this one, once spodumene prices have stabilized! next stop is drilling results in a few weks from Buldania, and a new resource estimate in July from Kathleen Valley.
Paringa -the company has delivered it´s first coal to the customer, and has also closed the 56 mill US$ financing. The debt is not cheap - but it makes very sure, that no fresh equity needs to be raised. The stock is 10ct too cheap, probably more - but coal stocks find it very hard to get some following these days. We might see some gradual valuation increases, once producction numbers become more meaningful during the course of the next few month. PNL have had a very hard time - management changes twice, cost overruns, and time-overruns of 4 month at least. I think this is behind them now - but I have to admit, that I find it a bit difficult to get too excited yet.
Mineral Resources - company has substantially upped the guidance from 280-320 mill A$ in EBITDA to 360-390 mill A$ for FY 2019. Main reason for this is teh strong performance of the iron ore price. Their Mt.marion spodumene project is making good progress, and the company mentioned, that tehy would be very happy with long term prices for the product around the current 650 US$. It´s hard to get excited about lithium in the short term - but if I have confidence in someone in the space, it´s MIN, with good exposure to their very professional iron ore crushing services, and speculative upside from iron ore ( i.e. high prices for longer than the market currently anticipates = a few month ).
Resolute - the excellent march-Quarter of 98.000oz at 1.39 A$ AISC/ oz gold was excellent - but only because of a stellar performnce from their stellite resource, Tabakoroni. The real story here is ramp-up of their fully automated sub-level cave at Syama, targeted to produce 300.000 oz p.a. - and that is having a few problems and will need until the end of this year to be fully up and running, 3 month at least longer than planned. It´s a risky project to bring on stream - but as it looks, Tabakoroni will be able to buy them some more time. The upside to a positive outcome is substantial - probably 40% or so in valuation…I think I change my stance from waiting here, to slowly start accumulating at current levels. The main reason for this is, that the satellite deposite can deliver for another 2 Quarters or so.
Have a nice evening