Magnis Resources Limited
Tanzania update: Magnis Resources Limited’s (ASX: MNS) stock surged up 3.797% on April 19, 2018 as the group announced about the Tanzania update on the Nachu Graphite Project. The objective of this announcement was to clarify the several queries that have been raised by the company’s shareholders and comments made by some media forums on the status of the Special Economic Zone (SEZ) licence and the current situation of the company in Tanzania. In the reference of queries, the company mentioned about the three licences i.e., the SEZ Developers Licence, the EPZ Developers Licence and the EPZ Operators Licence that have been approved by the Export Processing Zone Authority (EPZA) of Tanzania. In addition to this, the SEZ will be operated by Magnis Technologies Tanzania Ltd (MTT) and mining operations will be operated by the Company’s other fully owned subsidiary i.e., Uranex Tanzania Ltd (Uranex). Since the declaration of the endorsement of the SEZ permit, the company has gotten various expression of interest from large financial institutions for the funding of infrastructure to the project. This interest incorporates gas pipelines, power supply and roads. Further, Magnis administration will keep on focusing on what it sees as the best alternative for the development of Nachu along with the battery manufacturing plants.
On the other hand, the company expressed that Imperium3 New York (iM3NY) has gained great ground on its New York Gigafactory project with the movement of the battery plant from North Carolina which is now in progress. Recently, Magnis made a strategic investment to acquire a 10% interest for driving US based, lithium-particle battery technology group, i.e., Charge CCCV LLC ("C4V"), and secured an exclusive agreement over specific licenses, which will help with driving the Company's development in the lithium-particle battery segment. The management believes that the after-effect of this agreement will create unique competitive advantages against alternative lithium-ion battery producers. These advantages have just been seen through the Company's past joint efforts with C4V, which repeatedly generate huge interest from major worldwide companies. On the other hand, Mr Peter Sarantzouklis has resigned as a director of the Company effective immediately. While market has been concerned on the recent changes and the 16.8% fall in the last six months, we believe it might be prudent to wait for any further catalysts that the group can pull out of its cap in light of the targets specified. We maintain a “Hold” recommendation on the stock at the current market price of $ 0.410.
Nachu Graphite Project (Source: Company Reports)
Northern Cobalt Limited
Uplift of 41% in Contained Cobalt at Stanton Cobalt Deposit: Northern Cobalt Limited (ASX: N27) has plunged by about 43.9% in last three months, while the future run-up is partly based on any favourable movement in the cobalt prices. Further, the Group lately announced to offer qualified investors to subscribe for up to $15,000 of new fully paid ordinary shares in the company under the Share Purchase Plan (SPP Plan) after receiving a solid response of Placement from the domestic and international institutional and professional investors. The group was targeting to raise $1.0 million through SPP. If the total demand for the SPP surpasses $1.0 million, then the Company claims all authority to close the SPP early and downsize applications or choose to build the sum raised under the Plan. However, the market is waiting for an update post the SPP extension made pending a resource update. In fact, the group soon announced a 41% rise from 850t to 1200t on contained cobalt for its lead Stanton Cobalt Deposit, part of its Wollogorang cobalt project in the Northern Territory. As a result of this, the upgraded mineral resource is now sitting at 942,000t @ 0.13% cobalt (Co), 0.06% nickel (Ni) and 0.12% copper (Cu). As per the management, the upgrade of the Stanton Resource is a positive kick to understand the cobalt capability of the Wollogorang Cobalt Project. In addition to this, metallurgical testing as of now is in progress that will give a valuable insight into the possible processing choices in the future. Presently, the wet season is nearing the end, exploration drilling will start in the coming weeks to test 37 newly identified targets, utilising lighter and more affordable drilling rigs in busy 2018 field season for Northern Cobalt. With this foregoing development, we expect that the company can track back on upside momentum. We maintain our “Hold” recommendation on the stock at the current market price of $ 0.295.
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Stanton Cobalt Deposit Mineral Resource (Source: Company Reports)
Battery Minerals Limited
Development catalyst for growth: Up 4.5% on April 19, 2018, Battery Minerals Limited (ASX: BAT) has recently announced an outstanding drilling result of Montepuez graphite project in Mozambique. Additionally, Mining License has been granted for the Montepuez Graphite Project. With this reference, Montepuez graphite project gained quick ground on each level andthe group will export its first shipment of graphite concentrate in the March 2019 Quarter. The main objective of this project is to significantly improve the financial returns by optimizing the processing plant through modularization and refining the mine plan to produce a higher head grade. Moreover, BAT has taken a robust, well referenced and conservative approach to graphite commodity price assumptions in the value engineering study (VES), to provide a solid base for decision making. In addition, VES found that the group’s CAPEX is down to US$42.3M from US$126 million and its OPEX per tonne of concentrate is of US$337/t based on processing about 500,000t of ore at a grade of 12% Total Graphite Content (TGC). This will help Montepuez to initially produce 45,000 - 50,000t pa of graphite flake concentrate at up to 97% TGC. Further, the group will continue to focus on its research and development program on spheronisation for anode production. On the other hand, the group signed four biding offtake agreements, of which, three agreements were signed for 3 years for 10,000tpa of graphite concentrate with Qingdao Keshuo, Qingdao Black Dragon, and Qingdao Guangxing Electronic Material Co. Ltd (GEM) for the production and marketing of graphite. The first binding sales agreement was with a leading US-based graphite processor Urbix Resources LLC, covering a minimum of 5,000tpa and up to 11,000 tonnes of graphite concentrate per year. Meanwhile, the stock has fallen 14.1 percent as on April 18, 2018. Based on significant development, we give a “Speculative Buy” recommendation on the stock at the current market price of $ 0.070.
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Montepuez graphite project (Source: Company Reports)
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