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Toro Energy
Investor Insight
Toro Energy’s significant uranium resource in a tier 1 jurisdiction places the company in a compelling position to leverage a bullish uranium market and the mineral’s strategic role in global decarbonization.
Overview
Countries worldwide are working towards decarbonization and paying more attention to clean energy sources. About 10 percent of the world's electricity is produced from 440 power reactors, and more countries like Japan, Germany, the UK and the US are revitalizing their nuclear energy capacities to reduce fossil fuel production while improving energy security.
Australia produces 12 percent of the world’s uranium, behind Canada (13 percent) and Kazakhstan (43 percent). It is also home to the Wiluna uranium project, a well-established uranium resource, which is also the flagship asset of Toro Energy (ASX:TOE), a uranium exploration and development mining company that actively seeks to uncover value from other commodities in its existing highly prospective project ground.
As of September 24, 2024, Toro holds JORC-compliant uranium resources of 112.7 million pounds (Mlbs) uranium oxide (U3O8), which includes the flagship Wiluna project, Dawson Hinkler deposit (100 ppm U3O8 cut-off), and Theseus and Nowthanna deposit (200 ppm U3O8 cut-off).
The 100-percent-owned Wiluna uranium project includes three key deposits – Lake Maitland, Centipede-Millipede and Lake Way – and offers significant uranium exposure of 87.8 million tons (Mt) at 381 ppm for 73.6 Mlbs U3O8 at 100 ppm cut-off (JORC 2012). It is located only 30 kilometers southeast of Wiluna in Central Western Australia.
The Wiluna uranium project has received state and federal approval (subject to required amendments) and has been granted mining leases.
Considerable research over recent years has identified processing redesign opportunities from unique geological attributes within the uranium deposits, but particularly at Lake Maitland, as well as the ability to extract the inherent vanadium held within the uranium ‘ore’ for a vanadium by-product.
Within the uranium mineralization envelope, the Wiluna project is estimated to contain 141.8 Mt vanadium oxide (V2O5) at 286 ppm for 89.3 Mlbs of V2O5 at 100 ppm V2O5 cut-off (JORC 2012), as of September 24, 2024.
The unique geology of the Lake Maitland deposit and the processing redesign have allowed for a mining and processing option exclusively for Lake Maitland, that could be economic on its own or be the economic spearhead of a longer-term, larger Wiluna mining operation (dependent on market conditions and approvals). The stand-alone Lake Maitland option, aided by the economic efficiency of the new processing design, results in a transformational potential increase in production from the Lake Maitland deposit.
The scoping study for the stand-alone Lake Maitland uranium-vanadium operation option shows potential for exceptional financial returns with a pre-tax NPV of AU$832.8 million, a short payback period of 2.5 years, 48 percent internal rate of return, and low capex of AU$291 million (US$203 million), based on price assumption of US$85/lb U3O8, US$5.67/lb V2O5 and a 70 cents US$:AU$ exchange rate.
In September 2024, the Lake Maitland deposit has been re-estimated using a resource envelope more in line with the other Wiluna uranium deposits; allowed the lowering of the cut-off grade to 100ppm U3O8, expanding Lake Maitland resources by 12 percent and that of the entire Wiluna project by 17 percent (when the expansions at Lake Way and Centipede-Millipede are also included).
The design phase of Toro Energy’s beneficiation and hydrometallurgical pilot plant is on track and in line with plans to finalise construction at the end of 2024-beginning of 2025. . The pilot plant will test the improved beneficiation and hydrometallurgical circuit developed by Toro from bench scale research at a closer-to-production scale and as single streams. It will also test potential ore from the three uranium-vanadium deposits that Toro believes will make up an extended Lake Maitland operation – these include Lake Maitland, Lake Way and Centipede-Millipede.
The company will commence a large sonic core drill program to provide bulk, but targeted potential ore, for the upcoming pilot plant program in 2025.
The Lake Maitland deposit is part of a joint venture partnership with two reputable Japanese corporations, Japan Australia Uranium Resource Development. (JAURD) and Itochu.
Toro has been actively evaluating the prospectivity of its Wiluna asset portfolio for minerals other than uranium, including nickel and gold.
Toro’s Dusty nickel project is located on the northern, eastern and southern shores of Lake Maitland and the Lake Maitland uranium deposit and is focused on two main target areas: Dusty and Yandal One. These properties will be the subject of a proposed demerger, following Toro’s recent strategic review of its non-core assets and future plans to solely focus on its uranium development opportunities and its flagship Wiluna project.
Toro Energy’s management team and board of directors have extensive experience in the mining industry, with combined expertise that includes working at major mining houses, exploration companies, uranium mining operations, corporate financing and government and community relations.
Company Highlights
- Toro Energy is a well-established Western Australian uranium exploration and development company that actively seeks to uncover value from other commodities in existing highly prospective ground.
- Toro holds JORC-compliant uranium resources of 112.7 Mlbs uranium oxide across its Western Australian projects.
- Toro’s 100-percent-owned flagship Wiluna uranium project, located 30 kilometers southeast of Wiluna in Central Western Australia, 87.8 Mt at 331 ppm for 73.6 Mlbs U3O8 at 100 ppm cut-off over three deposits: Lake Maitland, Centipede-Millipede and Lake Way.
- The company has defined a significant maiden vanadium resource of 89.3 Mlbs of V2O5 at a 100ppm V2O5 cut-off inside the uranium mineralisation envelope.
- Scoping study completed for a stand-alone Lake Maitland uranium-vanadium operation shows potential for exceptional financial returns.
- In addition to its flagship uranium project, Toro’s strategic evaluation of the Lake Maitland tenure has resulted in the discovery of massive nickel sulphide and vein-hosted gold, which include the Dusty nickel project and the Yandal gold project.
- Following a recent strategic review, Toro is considering to solely focus on its uranium development opportunities and demerge its portfolio of non-core projects, including the nickel, gold and base metal assets in Western Australia.
- The company is led by a management team and board of directors with direct experience in the uranium exploration and mining as well as base metal exploration industry.
Key Projects
Wiluna Uranium Project
Toro Energy’s flagship asset is located only 30 kilometers from the town of Wiluna in the northern goldfields region within central Western Australia. The Wiluna project contains 87.8 Mt at 381 ppm for 73.6 Mlbs U 3O8 at 100 ppm cut-off over three deposits: Centipede-Millipede, Lake Way and Lake Maitland. The asset has been de-risked and optimized to improve yield and has successfully incorporated the processing of a vanadium resource as a by-product. A scoping study was completed for a stand-alone Lake Maitland uranium-vanadium operation.
Project Highlights:
- De-risked Uranium Project: Toro Energy has de-risked the Wiluna uranium asset by:
- Obtaining state and federal environmental approvals. Retrospective amendment to substantial commencement date condition will be required as well as amendment to mining proposal required as a result of further studies which significantly enhanced the project (refer below)
- Securing mining leases
- Identifying a simple yet effective mining process
- Extensive laboratory testing of a new and efficient beneficiation and processing technique inclusive of the extraction of vanadium for a valuable by-product.
- Uranium Exploration assets: Toro also owns 100 percent of three other exploration projects in Western Australia that have a total uranium resource of 39.1 Mlbs Nowthanna (200ppm U3O8 cut-off), Dawson Hinkler (100ppm U3O8 cut-off) and Theseus (200ppm U3O8 cut-off).
- Lake Maitland Pit Expansion: A 2022 pit expansion for a stand-alone Lake Maitland mining and processing operation, based on an updated uranium price, the inclusion of vanadium as a by-product, revised OPEX based on a the new beneficiation and processing flow sheet, increased the potential volume of uranium ore
- Initial Scoping study at proposed Lake Maitland Uranium-Vanadium Operation: Initial scoping study results following the 2022 pit expansion highlight the project’s potential for robust financial returns, increasing the asset to US$608 million in potential gross product value (assumes a US$70/lb U3O8, US$5.67/lb V2O5 price and a US$: AU$0.70 exchange rate).
- 2024 Scoping Study Financial Metrics Update: A refresh of the scoping study on the stand-alone Lake Maitland operation which incorporates current financial metrics and improved uranium pricing has been recently completed resulting an increase in pre-tax NPV to $832.8 million and 48% IRR (assumes a US$85/lb U3O8, US$5.67/lb V2O5 price and a US$: AU$0.70 exchange rate).
- Further Expansion of Scoping Study: to incorporate amenable ore from Toro’s Lake Way and Centipede-Millipede uranium deposits into the proposed processing operation at Lake Maitland.
- Expanded Resource at Lake Maitland, Lake Way and Centipede-Millipede deposits: Expansion of the stated U3O8 and V2O5 resources at all three uranium-vanadium deposits was conducted by reducing the stated U3O8 and V2O5 resource cut-off grades to 100 ppm (from 200 ppm):
- The stated Lake Maitland U3O8 resource expands by 12 percent or 3.2 Mlbs to 29.6 Mlbs contained U3O8, with a reduction in average grade to 403 ppm U3O8
- The stated Centipede-Millipede U3O8 resource expands by 25 percent or 5.98 Mlbs to 29.95 Mlbs contained U3O8, with a reduction in average grade to 351 ppm U3O8.
- The stated Lake Way U3O8 resource expands by 15 percent or 1.79 Mlbs to 14.12 Mlbs contained U3O8, with a reduction in average grade to 406 ppm U3O8.
- The stated Lake Maitland V2O5 resource expands by 74% or 13.4Mlbs to 31.4Mlbs contained V2O5, with a reduction in average grade to 285ppm V2O5. The stated Centipede-Millipede V2O5 resource expands by 17 percent or 6.6 Mlbs to 45.2 Mlbs contained V2O5, with a reduction in average grade to 281 ppm V2O5.
- The stated Lake Way V2O5 resource expands by 9.5 percent or 1.1 Mlbs to 12.7 Mlbs contained V2O5, with a reduction in average grade to 307 ppm V2O5.
- Pilot Plant Design Commissioned: A detailed pilot plant design is being undertaken to further assess the new processing flowsheet for Lake Maitland at a closer to ‘operational’ scale. The pilot plant design is on track incorporating all aspects of both uranium and vanadium production. A sonic core drilling program will commence to deliver potential ore to the pilot plant currently in design for Wiluna.
- Robust Local Infrastructure: The assets are within an established mining center, which means much of the required infrastructure is readily available. The project has access to power and water, which reduces initial development costs.
- Joint Venture Partnership: Toro Energy has entered into a joint venture partnership with JAURD and Itochu for its Lake Maitland deposit. Both corporations have the right, but not the obligation, to earn a combined 35 percent interest in the project upon contributing US$39.6 million, and an additional proportionate share of expenditure thereafter, once a positive final investment decision has been made based on a definitive feasibility study.
The Dusty Nickel Project – Discoveries of Massive Nickel Sulphide
Toro’s Lake Maitland tenure is located in the Yandal Greenstone Belt within the Yilgarn Craton of Western Australia, a gold district within a world-class gold and nickel province. With little exploration for non-uranium minerals ever conducted on the properties, Toro considers the project area highly prospective for nickel, gold and base metals.
In 2020, Toro made a blind discovery of massive and semi-massive nickel sulphides associated with the base of a 7.5-kilometer unbroken length of previously unknown komatiite (Dusty komatiite) – arguably the first massive nickel sulphides discovered in the Yandal Greenstone Belt, which is located 50 kilometers east of the world-class Mt. Keith nickel deposit. The Dusty nickel project is located near the Lake Maitland uranium deposit and contains two key target areas: Dusty and Yandal One.
Continued exploration and diamond drilling on the project has resulted in four discoveries of massive/semi-massive nickel sulphide zones to date with only 4.5 kilometers tested so far at a single depth along a 7.5-kilometer komatiite magnetic trend. Only limited testing for massive nickel sulphides has been undertaken to date of an approximately 15-kilometer strike length of known komatite - ultramafic target rock. With such limited drilling on the Lake Maitland tenure, it is yet to be known whether other similar magnetic anomalies are also komatiite-ultramafic rock and how much more rock is prospective for massive nickel sulphides on Toro’s 100-percent-owned Dusty nickel project.
Project Highlights:
- Four zones of massive nickel sulphide discovered: Toro has discovered four zones of massive and semi-massive nickel sulphides: Dusty, Houli Dooley, Jumping Jack and Dimma. Significant diamond drill results from these discoveries to date include:
- DUSTY
- 9 meters at 2.07 percent nickel from 250.9 meters downhole (TED07) including:
- 2.0 meter at 4.01 percent nickel from 250.9 meters downhole; and
- 2.0 meters at 3.85 percent nickel from 255.5 meters downhole.
- 2.6 meters at 3.45 percent nickel from 184.5 meters downhole (TED04).
- 7.2 meters at 1.05 percent nickel and 0.26 percent copper from 252 meters downhole (TED22).
- 9 meters at 2.07 percent nickel from 250.9 meters downhole (TED07) including:
- HOULI DOOLEY
- 3.05 meters at 1.59 percent nickel from 297.75 meters downhole (TED14).
- JUMPING JACK
- 3.45 meters at 1.42 percent nickel from 240.2 meters downhole (TED37).
- 2.44 meters at 1.16 percent nickel from 231.6 meters downhole (TED38).
- DIMMA
- 4.31 meters at 1.16 percent Ni from 243.3 meters downhole (TED41).
- 3.13 meters at 1.42 percent Ni from 314 meters downhole (TED42).
- 4.6 meters at 1.61 percent Ni from 194.2 meters downhole, including 3m at 1.09 percent Ni from 166 meters downhole (TED54).
- 2.1 meters at 1.83 percent Ni from 147.1 meters downhole (TED55).
- DUSTY
- Yandal OneTarget Area: The Yandal One Target Area is located some 17 kilometers south of the Dusty discoveries and with limited drilling, Toro has proven the existence of another komatiite with the potential to host massive nickel sulphide.
Toro Yandal Gold Project
The Lake Maitland tenure is located only 20 kilometers northeast of the world-class Bronzewing and Mt McClure gold mines within the same Greenstone Belt, the Yandal, within one of the most famous gold provinces in the world, the Yilgarn Craton.
Early exploration by Toro at the Golden Ways target area in the north of the project has uncovered surface rock chip samples of up to 70 g/t gold and significant drilling results, including:
- 5 meters at 4.4 g/t from 22 meters (TERC24)
- Including 2 meters at 9.93 g/t from 22 meters
- 4 meters at 3.3 g/t from 28 meters (TERC25)
- Including 1 meter at 10.9 g/t from 28 meters
- 2 meters at 3.79 g/t from 10 meters (TERC38)
- Including 1 meters at 7.33 g/t from 10 meters
- 3 meters at 1.41 g/t from 9 meters (TERC36)
- Including 1 meters at 2.76 g/t from 10 meters
Management Team
Richard Homsany - Executive Chairman
Richard Homsany has extensive experience in the resources industry, having been the executive vice-president for Australia of TSX-listed Mega Uranium since April 2010. He has worked for North Ltd, an ASX top 50-listed internationally diversified resources company in operations, risk management and corporate, before its takeover by Rio Tinto.
Homsany is an experienced corporate lawyer and certified practicing accountant (CPA) advising numerous clients in the energy and resources sector, including publicly listed companies. He was corporate partner at international law firm DLA Phillips Fox (now DLA Piper), where he advised clients on a range of transactions and matters including capital raising, IPOs, stock exchange listing, mergers and acquisitions, finance, joint ventures, divestments and governance.
He is a fellow of the Financial Services Institute of Australasia (FINSIA) and a member of the Australian Institute of Company Directors. He has a commerce degree and honors degree in law from the University of Western Australia, and a graduate diploma in finance and investment from FINSIA (State Dux).
Homsany has significant board experience with publicly listed companies in Australia and Canada. He is the chairman of ASX-listed copper explorer Redstone Resources. and TSXV-listed iron ore and gold explorer Central Iron Ore Limited. Homsany is currently the chairman of the Health Insurance Fund of Australia Limited.
Michel Marier - Non-executive Director
Michel Marier joined Sentient in 2009 as an investment manager. Before joining Sentient, Marier worked eight years in the private equity division of la Caisse de dépôt et placement du Québec. Marier holds a master’s degree in finance from HEC Montreal and is a CFA charter holder.
Richard Patricio - Non-executive Director
Richard Patricio is the CEO and president of Mega Uranium, a uranium-focused investment and development company with assets in Canada and Australia.
In addition to his legal and corporate experience, Patricio has built a number of mining companies with global operations. He holds senior officer and director positions in several junior mining companies listed on the TSX, TSX Venture, AIM and NASDAQ exchanges. He is currently also a director of NexGen Energy (TSE:NXE, Mkt Cap. C$2.7 billion). He previously practiced law at a top-tier law firm in Toronto and worked as an in-house general counsel for a senior TSX-listed company. He received his law degree from Osgoode Hall and was called to the Ontario bar in 2000.
Dr. Greg Shirtliff – Geology Manager
Dr. Greg Shirtliff has over 20 years of experience in industry-related geology and geochemistry, including a PhD in mine-related geology and geochemistry from the Australian National University. Since his studies, Dr Shirtliff has spent some 20 years in various roles in the mining and exploration industry ranging from environmental, mine geology, resource development, exploration and management roles in exploration and technical projects inclusive of engineering and metallurgical. His roles have included a number of years at ERA-Rio Tinto’s Ranger Uranium Mine, as the senior geoscientist for Cameco Australasia and more recently as the lead geologist and technical manager for Toro Energy, where he is the exploration and technical lead responsible for increasing the viability of the company’s uranium and mineral resources, developing and directing the company’s uranium and non-uranium exploration strategy, aiding the company technically through EPA approval for a uranium mine, and guiding the engineering and metallurgical through to scoping level economic assessment.
Dr Shirtliff has had recent exploration success at Toro Energy, discovering multiple zones of massive nickel sulphide mineralization along the Dusty Komatiite, arguably the first massive nickel sulphide mineralization discovered in the Yandal Greenstone Belt in Western Australia.
Dr Shirtliff holds directorships on privately owned consultancy and prospecting companies and is a long-standing member of the Australian Institute of Mining and Metallurgy and the internationally recognized Society of Economic Geologists.
Katherine Garvey - Legal Counsel and Company Secretary
Katherine Garvey is a corporate lawyer who has significant experience in the resources sector. Garvey advises public (both listed and unlisted) and proprietary companies on a variety of corporate and commercial matters including capital raising, finance, acquisitions and disposals, Corporations Act and ASX Listing Rule compliance, corporate governance and company secretarial issues. She has extensive experience drafting and negotiating various corporate and commercial agreements including farm-in agreements, joint ventures, shareholders’ agreements, and business and share sale and purchase agreements.
Garvey is a senior associate at Cardinals Lawyers and Consultants, a corporate and resources law firm in West Perth, and company secretary of the Health Insurance Fund of Australia Limited. Garvey is also legal counsel (Australia) to TSX-listed Mega Uranium, and company secretary to TSXV-listed Central Iron Ore.
Marc Boudames - Financial Controller
Marc Boudames is experienced in statutory financial reporting, taxation, ERP systems, business analytics, corporate transactions, due diligence, mergers & acquisitions, finance, joint ventures and divestments. He previously worked at RSM Bird Cameron, as general manager –finance & administration for ASX-listed Redport Ltd and Mega Uranium (Australia), a Canadian TSX-listed mining and equity investment company focused on global uranium properties and multi-mineral exploration. He has worked for multiple companies across various industries, including listed and public companies associated with the mining and oil and gas sectors, such as WesTrac, CB&I and Spotless Group.
Quarterly Activities Report - For Period Ended 30 September 2024
September 2024 Quarter Activities
- Licence Application lodged and granted for southern tenement (213km2) contiguous to the Ulytau Uranium Project
- Licence Application lodged and granted for the northern tenement (39km2), which sits immediately north of the historic Bota Burum Uranium mine
- The new tenements are interpreted to contain the same mineralised uranium trend to that of the existing Ulytau Project area
- Received Category four (4) exploration works approval to enable the immediate commencement of geophysical and soil sampling programs, further reinforcing the positive operating environment and Government support in Kazakhstan
- Progressed Category two (2) drilling approval and commenced site based activities in preparation for drilling commencement
Commenting on the Quarter, C29 Metals Managing Director, Shannon Green, stated: “"We are excited with the rapid progress made during the Quarter in both advancing our drilling permit and expanding our highly prospective Ulytau Uranium Project, with both the northern and southern tenement applications successfully granted thereby expanding the Project area to 276km2. This achievement underscores the efficiency and support of the local Government, allowing us to advance our
exploration efforts swiftly. The Ulytau region continues to demonstrate significant potential, and with strong local support and community engagement, we are excited to further explore this mineralised trend and enhance our growth strategy in Kazakhstan."
Exploration Program – Ulytau Uranium Project
The Company commenced initial exploration activities on its Ulytau Uranium Project in August 2024 after receiving Category four (4) exploration approval. The initial geological program consisted of tenement wide mapping and some initial soil sampling to assist with finalising drill hole locations.
The geology team utilised a handheld X-ray fluorescence (“XRF”) unit to provide real time geological information to the team and valuable geological data that will assist with the initial drill hole targeting and methodology.
Post Quarter end on 16 October 2024, the Company announced that it had received official notification from the Natural Resources and Environmental Management Department the company has met all regulatory requirements for the issue of the drill permit, enabling the commencement of mobilisation for the initial drilling at its Ulytau Uranium project.
License Applications for Project Expansion
The Company expanded its footprint at the Ulytau Uranium Project with the lodgement of two new applications for tenements in July 2024, the tenements, located to the North and to the South and South-East have a combined size of ~252km2 (Figure 1). Both applications were reviewed and granted by the Ministry during the Quarter, increasing the total footprint of the Ulytau Uranium Project to ~276km2.
Figure 1 – The interpreted mineralised uranium trend with new licence applications
The two granted areas have been interpreted as having a similar mineralised trend to that of the existing Ulytau Uranium Project area. Please refer to ASX Announcement “License Applications Lodged around Ulytau Uranium Project” dated 24 July 2024 and the further clarification on 25 July 2024.
Click here for the full ASX Release
This article includes content from C29 Metals Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Joint Ventures, M&A Ramp Up in Critical Minerals Space
Critical minerals shortage
Across the globe, nations are pivoting away from fossil fuels and towards green energy, mainly through electrification, with huge investments underway to transition the transportation, heating and cooling, and manufacturing sectors. Most modes of generating and storing green electricity require a long list of minerals the economy did not previously need in meaningful quantities.
Most nations lack stable supply chains for these minerals and other elements, posing potential risks to their economic future, and the future of their defense sector. For example, an article published by the Carnegie Endowment for International Peace suggests the US and the North Atlantic Treaty Organization could be at risk in a crisis because of limited access to the minerals they need for a conflict. As well, attempts to control the supply chain can turn to a geopolitical wrangling between nations.
Trade in energy-related critical minerals has risen from US$53 billion to US$378 billion over the last 20 years, according to data from the World Trade Organization. Minerals and rare earth elements could see demand quadruple by 2050.
Problem solved
Demand and prices for many critical minerals have seen a dramatic turnaround in recent years due to the soaring green economy. However, mining development and production don’t pivot that quickly. We’re living in that challenging lag right now.
To help speed up the process of getting early stage deposit discoveries into production, or expand or revitalize existing mining properties, more junior mining companies and others in the space are working together.
Joint ventures allow two organizations to combine capital, expertise, access, historical data and other resources, such as extraction or processing facilities, and that results in a percentage profit sharing later on.
Such partnerships allow companies to diversify. While critical minerals are in hot demand, prices still fluctuate and shortages can shift, as can access to perks such as government funding.
Ventures are common between junior miners and more established mining businesses. The former may have access to a deposit, experience with early stage development and flexibility. Larger mining companies tend to have access to capital and possess different types of managerial and technical expertise. Many of these established firms also seek access to critical mineral opportunities, and are willing to invest to gain them.
Saga Metals (TSV:SAGA), for example, struck a joint venture deal with Rio Tinto Exploration Canada, a subsidiary of mining giant Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO), for its Legacy lithium project in James Bay, Quebec.
The total Legacy property spans over 65,849 hectares with 34,243 hectares optioned to Rio Tinto, hosting the same geological setting along strike from Rio Tinto’s other lithium project, Winsome Resources (ASX:WR1,OTCQB:WRSLF), Azimut Exploration (TSXV:AZM,OTCQX:AZMTF) and Loyal Lithium (ASX:LLI) in the La Grande sub-province.
Saga Metals' Amirault lithium project.
“It lends credibility to management’s ability to execute these types of agreements with a company as big as Rio, but it also validated the ground we staked/acquired, and management’s ability to find quality projects,” said Mike Stier, CEO and director of Saga Metals.
Such relationships are being struck in a range of mineral sectors.
“It drives shareholder value. Companies may realize what their limits are and a bigger company can come in after you’ve taken it from A to B and they can go from B to G,” said Stier.
M&A activity, meanwhile, offers similar benefits. Mining outfits in acquisition mode may purchase smaller, junior miners, or their interest in certain properties, to help expand their portfolios. Growing mining companies often seek projects at all stages of development to ensure diversification inside the organization.
Overall, the amount of mining M&A has been growing over the past few years, sitting flat between 2022 and 2023. However, the value of the deals has been on a more dramatic rise.
Collaborations of note
Saga Metals and Rio Tinto Exploration’s C$44 million two stage earn-in option agreement has led to the commencement of initial exploration in August 2024 at the Legacy lithium project.
This project is undergoing fieldwork with a focus on pegmatite mapping and geophysical surveys. Saga has 1,274 claims covering 65,849 hectares in the region, in what has become the newest lithium district in and around James Bay.
“We’ll also be keeping our eyes and ears open to the macro landscape with respect to the critical minerals in our portfolio,” said Stier of next steps for Saga Metals. “We’ll push our projects forward and continue them through their stages of development, de-risking them as we go.”
In uranium mining, Paladin Energy (ASX:PDN,OTCQX:PALAF) has agreed to acquire Fission Uranium (TSX:FCU,OTCQX:FCUUF). The deal will enable Paladin to list on the TSX, leading to increased trading liquidity and an enhanced capital markets presence. Paladin will become a multi-asset uranium company with benefits to the Patterson Lake South project. Paladin’s CEO has made it clear that the company has future acquisitions in mind as well.
Recently, Lundin Mining (TSX:LUN,OTC Pink:LUNMF) and BHP (ASX:BHP,NYSE:BHP,LSE:BHP) agreed to jointly acquire Filo (TSX:FIL,OTCQX:FLMMF), in a deal worth an estimated C$4.1 billion. The 50/50 joint venture has the aim of developing an emerging copper district in Argentina, focusing on the Filo del Sol project and the Josemaria project.
Investor takeaway
Partnerships and collaborations between mining companies have become an emerging standard of practice as the critical minerals race pushes on and both business and government try to secure supply lines. With myriad benefits, expect more future alliances in the critical minerals mining industry.
This INNSpired article is sponsored by Saga Metals (TSXV:SAGA). This INNSpired article provides information which was sourced by the Investing News Network (INN) and approved by Saga Metalsin order to help investors learn more about the company. Saga Metals is a client of INN. The company’s campaign fees pay for INN to create and update this INNSpired article.
This INNSpired article was written according to INN editorial standards to educate investors.
INN does not provide investment advice and the information on this profile should not be considered a recommendation to buy or sell any security. INN does not endorse or recommend the business, products, services or securities of any company profiled.
The information contained here is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities. Readers should conduct their own research for all information publicly available concerning the company. Prior to making any investment decision, it is recommended that readers consult directly with Saga Metals and seek advice from a qualified investment advisor.
1st Quarter Activities and Appendix 5B
HIGHLIGHTS
- Completion of drilling at the Mkuju Project - 20 diamond core holes for 2800 m of drilling, testing the SWC and Mtonya targets, and testing potential extensions to the Likuyu North deposit.
- At SWC, high-grade uranium from surface including:
- 3.8m @ 2,458ppm eU3O8 from surface,
- 2.4m @ 3,528ppm eU3O8 from surface,
- 1.8m @ 3,089ppm eU3O8 from surface and 1.2m @ 988ppm eU3O8 from 5.9m depth
- At Mtonya, best interval of 2.3m @ 372ppm eU3O8 from 6.16m depth.
- At Likuyu North, possible moderate extension to the deposit indicated by visual mineralisation in LNDD015, now awaiting assays; and
- LNDD020 drilled central to the Likuyu North deposit to provide information for an initial assessment of In-Situ Recovery (ISR); intersected 6 mineralised intervals including:
- 2.5 metres with an average grade of 438 ppm eU3O8 from 17.1m depth.
- 7.1 metres with an average grade of 1,963 ppm eU3O8 from 63.1m depth.
MKUJU URANIUM PROJECT - TANZANIA
Table 1 summarises the work completed during the quarter at the Mkuju Project.
Table 1. Summary of the work at each target
Figure 1: The Mkuju Project area over airborne radiometric data with important deposits and targets labelled.
SWC TARGET EXPLORATION
During May 2024 a camp was constructed and a drilling and exploration crew was mobilized. The holes drilled at SWC are shown on Figure 2. Table 2 provides the results of the SWC and Mtonya drilling. The drilling at SWC was to follow-up on the high-grade intervals achieved from the trenches reported in the Company announcement dated 9th January 2024.
Figure 2. Map of the SWC and Mtonya targets showing historic and Gladiators drilling
All holes were vertical, drilling was by diamond core and the deepest was 188.7 metres. The results were reported in announcements dated 24th June and 16th August 2024. Selected results are provided below:
- SWDD001: 3.8m @ 2,458ppm eU3O8 from surface.
- SWDD002: 2.4m @ 3,528ppm eU3O8 from surface.
- SWDD005: 1.8m @ 3,089ppm eU3O8 from surface and 1.2m @ 988ppm eU3O8 from 5.9m depth
- SWDD006: 5.3m @ 143ppm eU3O8 from 3.0m depth
The trench and high-grade drilling intersections are interpreted to be the remains of a layer that is preserved on topographic highs within a relatively downthrown block, as illustrated in Figure 3, which represents a cross-sectional interpretation through SWC. Where the layer is at or very near surface as in SWDD001 and SWDD002, enrichment by supergene processes may have occurred whereas where deeper and unaffected by the surficial enrichment, as in SWDD006, grades are lower. No significant mineralisaton was intersected deeper in the holes drilled at SWC.
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