Here are four profiles on junior mining companies. Three of them are in exploratory stage. Millennial is beginning its mining operations and hopes to be at full production by 2024. My impression is that some mining companies in the exploration stage will gloss over how much cash is needed to open a mine, especially in battery metals that require more processing to make them economically viable compared with base and precious metals. I realized this after reading in Giga's material that it will cost $2 billion to open their proposed mine with accompanying processing plant and therefore they will need additional investment partners to make it happen.
Freeport Resources- FEERF $.19, 11 June 2021
Outstanding Shares: 75m
Employees: ?
Market cap: 13.5m
Cash: 3.1m (Canadian)
Operations:
1. Star Mountains, Papua New Guinea (PNG)- Copper and gold prospect; initial exploration in 2018 found estimated 2.9m oz gold and 840k tonnes copper; further drilling exploration ongoing to provide data for a preliminary economic assessment (PEA). Main focus of company.
2. Spanish Mountain, BC- Gold prospect; preliminary exploration via survey and drilling ongoing
3. “Q” Claims, BC- Fluorite, molybdenite (molybdenum), and niobium prospect; in initial stages of exploration; Freeport is soliciting additional partners to explore and develop the prospect
4. Rose Mine, BC- 100% owned, closed tungsten mine with potential for gold, silver, and copper; in initial stages of evaluation; 58k tonnes of tungsten believed to be in the mine
Notes:
The company says in its financial reports that it has a garnet prospect in Labrador and Newfoundland, but doesn’t mention it in its corporate presentations. The company doesn’t appear to be as concerned about showing concern for the environment in PNG as other companies- the website depicts huge open pit mines in the jungle and describes PNG as “pragmatic” on the environment. Since their other prospects are in BC, that might cause them some trouble with the green weenies in the BC government.
Since they haven’t progressed to PEA , it looks like it will be several years, at least, before mining might commence at Star Mountains. Since this company has apparently never operated a mine, they might seek a partner (hopefully not from the Middle Kingdom) for Star once they get closer to a decision to start mining it.
Giga Metals- HNCKF $.31, 15 June 2021
Outstanding Shares: 85m (May 2021 corporate presentation)
Employees: ?
Market cap: 18.37m
Cash: 2.8m
Operations:
1. Turnagain, BC- 100% owned nickel (Ni)/cobalt (Co) prospect; preliminary economic estimate (PEA) completed Oct 2020; claim is estimated to contain up to 2b tonnes of Ni and 640k tonnes Co with a 37-year mine life; plan is to produce 33k-37k tonnes of Ni and 2k tonnes of Co a year; $1.9b development cost and $2.81/lb operating cost vs current 7.50/lb price of Ni; because of high development cost, Giga is seeking partners to advance the project; estimated timeline of 2024 for final economic assessment and production decision and 2028 for startup of mine; deep, open pit planned; Giga plans to construct a processing plant at the mine that can do mixed hydroxide precipitate to produce Ni and Co ready for use in lithium batteries.
2. Brazil Project, Piaui, Brazil- Copper prospect undergoing initial exploration.
Notes:
Giga is stressing the “carbon neutrality” of its operations, likely to try to influence the green weenies in the BC government who will decide on their mining permit. Company believes its current cash is sufficient to fund operations and exploration until March 2022.
Raising the $2 billion necessary to open this mine would necessitate the sale of an awful lot of stock, especially with Giga’s current, low share price. More realistically, they’ll need to partner with one or more other interests to get the necessary financing. This would likely lower the return that ultimately accrues to Giga shareholders since the returns would need to be shared with the other partners. It would be interesting if Tesla or another company that uses/produces lithium batteries decided to partner with Giga to open this mine.
Millennial Lithium- MLNLF $2.44, 4 June 2021
Outstanding Shares: 89m
Employees: ?
Market cap: 214m
Cash: 41m (April 2021)
Operations: Both lithium properties are in Argentina.
1. Pastos Grandes- Flagship project; 100% owned; feasibility study was completed in July 2019 and projected a 40 year lifespan with a total estimated output of 943k tonnes of lithium; pilot processing plant constructed in 2020 and has begun initial test production of battery-grade lithium; first batch produced in early 2021 attained its purity goal as battery quality; immediate goal is to reach 3 tonnes per month output; company will then build a larger production facility which will, by 2024, allow for the production of 24k tonnes per year;
2. Cauchari East- Currently acquiring 100% interest. Only one drill hole has been done, with mixed results; however, other companies in the immediate area (Orocobre, Lithium Americas, and Advantage Lithium) have found promising results in their initial explorations. Covid has delayed additional exploration and testing.
Notes:
CEO is currently paid about $400k which seems reasonable. GCL, a Chinese solar company, has invested $30m in the company. ML wants to power their plant as much as possible with solar energy.
Company’s business plan appears to be straightforward, transparent, and credible. Their timeline for Pastos Grandes has hard dates and I don’t see any major risks, apart from possible political instability in Argentina. They appear to be focused on Pastos Grandes and have no projected dates for exploration and/or development of Cauchari East. I assume the latter project will likely ramp up around 2024 and could be in production (assuming exploration has favorable findings) by 2028-2030.
Nickel 28 Capital- CONXF $.81, 10 June 2021
Outstanding Shares: 86m
Employees: ?
Market cap: 68.56m
Cash: 6m vs 92m debt used to finance Ramu mine
Operations: The company calls its primary intended business strategy “metal streaming” in which it purchases interest or partial ownership in a functioning mine. The interest agreement gives Nickel 28 rights to a percentage of future ore/metals from that mine at its discretion. Nickel 28 focuses on battery metals, especially nickel and cobalt. The company also has royalty interest (net smelter return-NSR; gross revenue royalties-GRR; right of first refusal-ROFR) in a number of mining exploratory companies.
1. Ramu Nickel Mine, Papua New Guinea (PNG)- Owns 8.56% joint-venture interest in this in-production nickel (Ni)-cobalt (Co) mine. Principle owner is Metallurgical Corporation of China Ltd. The mine produces about 33k tonnes of nickel and 3k tonnes of cobalt a year. Nickel 28’s current revenue from the mine is dedicated to pay off the 92m debt (with 5.05% interest) from construction of the mine; once debt is resolved, the company’s ownership in the mine will increase to 11.3%, with an option to purchase an additional 9.25% (to 20.55%) at market price. Company does not say when total debt will be paid off. Mine had a major environmental incident in 2019 and PNG authorities are still assessing the ramifications for the owners.
2. Dumont Project, Quebec- Ni/Co open pit mine about to go into production; primary owner Waterton Global (private); 1.75% NSR for life of mine.
3. Turnagain, BC-Ni/Co prospect with Giga Metals Corp; mine start est 2028; 2% NSR and ROFR.
4. Flemington Project, Australia- Scandium (Sc)/Ni/Co prospect w/ Australian Mines Ltd; 1.5% GRR.
5. Nyngan, Australia- Sc/Ni/Co mine prod-ready; prime owner Scandium International; 1.7% GRR.
6. Star Mountains, PNG- Copper(Cu)/Gold(AU) prospect w/ Freeport Resources; 1% NSR
7. Sewa Bay, PNG- Ni/Co prospect w/ Pure Minerals; 5% free on board (FOB) GRR
8. Professor & Waldman Properties, Ontario- Silver(Ag)/Co prospect with 70% Golden Deeps & 30% New Found Gold Corp; 2% of Co NSR and ROFR. Exploration is currently suspended.
9. Triangle Property, Ontario- Ag/Co prospect w/ New Found Gold; 2% Co NSR and ROFR. Exp susp.
10. Rusty Lake Property, Ontario- Ag/Co prospect w/ iCobalt; 2% Co NSR and ROFR. Exp susp.
11. North Canol Properties, Yukon- Ag/lead(Pb)/Zinc(Zn)/Co prospect w/ Golden Ridge Resources; 2% Co NSR and ROFR.
12. Sunset Mineral Property, BC- Cu/Zn/Co prospect w/ private individuals; 2% Co NSR and ROFR.
Notes:
Changed name from “Conic Metals Corp” to current name on March 10, 2021. On March 15, 2021, the company purchased 52,500 carbon offsets on the Verra Registry in order to make their operations “carbon neutral” (facepalm). Vanguard charges a $50 overseas transaction fee to purchase this company’s shares. It appears that this company is trying to be a junior Wheaton of battery metals.
Freeport Resources- FEERF $.19, 11 June 2021
Outstanding Shares: 75m
Employees: ?
Market cap: 13.5m
Cash: 3.1m (Canadian)
Operations:
1. Star Mountains, Papua New Guinea (PNG)- Copper and gold prospect; initial exploration in 2018 found estimated 2.9m oz gold and 840k tonnes copper; further drilling exploration ongoing to provide data for a preliminary economic assessment (PEA). Main focus of company.
2. Spanish Mountain, BC- Gold prospect; preliminary exploration via survey and drilling ongoing
3. “Q” Claims, BC- Fluorite, molybdenite (molybdenum), and niobium prospect; in initial stages of exploration; Freeport is soliciting additional partners to explore and develop the prospect
4. Rose Mine, BC- 100% owned, closed tungsten mine with potential for gold, silver, and copper; in initial stages of evaluation; 58k tonnes of tungsten believed to be in the mine
Notes:
The company says in its financial reports that it has a garnet prospect in Labrador and Newfoundland, but doesn’t mention it in its corporate presentations. The company doesn’t appear to be as concerned about showing concern for the environment in PNG as other companies- the website depicts huge open pit mines in the jungle and describes PNG as “pragmatic” on the environment. Since their other prospects are in BC, that might cause them some trouble with the green weenies in the BC government.
Since they haven’t progressed to PEA , it looks like it will be several years, at least, before mining might commence at Star Mountains. Since this company has apparently never operated a mine, they might seek a partner (hopefully not from the Middle Kingdom) for Star once they get closer to a decision to start mining it.
Giga Metals- HNCKF $.31, 15 June 2021
Outstanding Shares: 85m (May 2021 corporate presentation)
Employees: ?
Market cap: 18.37m
Cash: 2.8m
Operations:
1. Turnagain, BC- 100% owned nickel (Ni)/cobalt (Co) prospect; preliminary economic estimate (PEA) completed Oct 2020; claim is estimated to contain up to 2b tonnes of Ni and 640k tonnes Co with a 37-year mine life; plan is to produce 33k-37k tonnes of Ni and 2k tonnes of Co a year; $1.9b development cost and $2.81/lb operating cost vs current 7.50/lb price of Ni; because of high development cost, Giga is seeking partners to advance the project; estimated timeline of 2024 for final economic assessment and production decision and 2028 for startup of mine; deep, open pit planned; Giga plans to construct a processing plant at the mine that can do mixed hydroxide precipitate to produce Ni and Co ready for use in lithium batteries.
2. Brazil Project, Piaui, Brazil- Copper prospect undergoing initial exploration.
Notes:
Giga is stressing the “carbon neutrality” of its operations, likely to try to influence the green weenies in the BC government who will decide on their mining permit. Company believes its current cash is sufficient to fund operations and exploration until March 2022.
Raising the $2 billion necessary to open this mine would necessitate the sale of an awful lot of stock, especially with Giga’s current, low share price. More realistically, they’ll need to partner with one or more other interests to get the necessary financing. This would likely lower the return that ultimately accrues to Giga shareholders since the returns would need to be shared with the other partners. It would be interesting if Tesla or another company that uses/produces lithium batteries decided to partner with Giga to open this mine.
Millennial Lithium- MLNLF $2.44, 4 June 2021
Outstanding Shares: 89m
Employees: ?
Market cap: 214m
Cash: 41m (April 2021)
Operations: Both lithium properties are in Argentina.
1. Pastos Grandes- Flagship project; 100% owned; feasibility study was completed in July 2019 and projected a 40 year lifespan with a total estimated output of 943k tonnes of lithium; pilot processing plant constructed in 2020 and has begun initial test production of battery-grade lithium; first batch produced in early 2021 attained its purity goal as battery quality; immediate goal is to reach 3 tonnes per month output; company will then build a larger production facility which will, by 2024, allow for the production of 24k tonnes per year;
2. Cauchari East- Currently acquiring 100% interest. Only one drill hole has been done, with mixed results; however, other companies in the immediate area (Orocobre, Lithium Americas, and Advantage Lithium) have found promising results in their initial explorations. Covid has delayed additional exploration and testing.
Notes:
CEO is currently paid about $400k which seems reasonable. GCL, a Chinese solar company, has invested $30m in the company. ML wants to power their plant as much as possible with solar energy.
Company’s business plan appears to be straightforward, transparent, and credible. Their timeline for Pastos Grandes has hard dates and I don’t see any major risks, apart from possible political instability in Argentina. They appear to be focused on Pastos Grandes and have no projected dates for exploration and/or development of Cauchari East. I assume the latter project will likely ramp up around 2024 and could be in production (assuming exploration has favorable findings) by 2028-2030.
Nickel 28 Capital- CONXF $.81, 10 June 2021
Outstanding Shares: 86m
Employees: ?
Market cap: 68.56m
Cash: 6m vs 92m debt used to finance Ramu mine
Operations: The company calls its primary intended business strategy “metal streaming” in which it purchases interest or partial ownership in a functioning mine. The interest agreement gives Nickel 28 rights to a percentage of future ore/metals from that mine at its discretion. Nickel 28 focuses on battery metals, especially nickel and cobalt. The company also has royalty interest (net smelter return-NSR; gross revenue royalties-GRR; right of first refusal-ROFR) in a number of mining exploratory companies.
1. Ramu Nickel Mine, Papua New Guinea (PNG)- Owns 8.56% joint-venture interest in this in-production nickel (Ni)-cobalt (Co) mine. Principle owner is Metallurgical Corporation of China Ltd. The mine produces about 33k tonnes of nickel and 3k tonnes of cobalt a year. Nickel 28’s current revenue from the mine is dedicated to pay off the 92m debt (with 5.05% interest) from construction of the mine; once debt is resolved, the company’s ownership in the mine will increase to 11.3%, with an option to purchase an additional 9.25% (to 20.55%) at market price. Company does not say when total debt will be paid off. Mine had a major environmental incident in 2019 and PNG authorities are still assessing the ramifications for the owners.
2. Dumont Project, Quebec- Ni/Co open pit mine about to go into production; primary owner Waterton Global (private); 1.75% NSR for life of mine.
3. Turnagain, BC-Ni/Co prospect with Giga Metals Corp; mine start est 2028; 2% NSR and ROFR.
4. Flemington Project, Australia- Scandium (Sc)/Ni/Co prospect w/ Australian Mines Ltd; 1.5% GRR.
5. Nyngan, Australia- Sc/Ni/Co mine prod-ready; prime owner Scandium International; 1.7% GRR.
6. Star Mountains, PNG- Copper(Cu)/Gold(AU) prospect w/ Freeport Resources; 1% NSR
7. Sewa Bay, PNG- Ni/Co prospect w/ Pure Minerals; 5% free on board (FOB) GRR
8. Professor & Waldman Properties, Ontario- Silver(Ag)/Co prospect with 70% Golden Deeps & 30% New Found Gold Corp; 2% of Co NSR and ROFR. Exploration is currently suspended.
9. Triangle Property, Ontario- Ag/Co prospect w/ New Found Gold; 2% Co NSR and ROFR. Exp susp.
10. Rusty Lake Property, Ontario- Ag/Co prospect w/ iCobalt; 2% Co NSR and ROFR. Exp susp.
11. North Canol Properties, Yukon- Ag/lead(Pb)/Zinc(Zn)/Co prospect w/ Golden Ridge Resources; 2% Co NSR and ROFR.
12. Sunset Mineral Property, BC- Cu/Zn/Co prospect w/ private individuals; 2% Co NSR and ROFR.
Notes:
Changed name from “Conic Metals Corp” to current name on March 10, 2021. On March 15, 2021, the company purchased 52,500 carbon offsets on the Verra Registry in order to make their operations “carbon neutral” (facepalm). Vanguard charges a $50 overseas transaction fee to purchase this company’s shares. It appears that this company is trying to be a junior Wheaton of battery metals.
