Sunday 20th August 2017

Resource Clips


Posts tagged ‘cobalt’

Jon Armes outlines Kapuskasing’s zinc, copper and cobalt projects in Newfoundland and Labrador

August 8th, 2017

…Read more

Robert Friedland’s favourites

July 28th, 2017

Unprecedented demand calls for unparalleled grades, the industry legend says

by Greg Klein

For all that’s being said about lithium and cobalt, Robert Friedland argues that the energy revolution also depends on copper and platinum group elements. Of course he has a stake in them himself, with Kamoa-Kakula and Platreef among his current enthusiasms. Still, whether motivated by self-interest or not, the mining titan whom Rick Rule calls “serially successful” presented a compelling case for his favourite metals at the Sprott Natural Resource Symposium in Vancouver on July 25.

We’re living in “an era of unprecedented change,” said Ivanhoe Mines’ TSX:IVN founding chairperson. China’s the main cause. That country’s “breeding mega-cities prodigiously.” But one result is “incredibly toxic air… with a whole suite of health effects” from heart attacks to stroke, asthma to Alzheimer’s.

Unprecedented demand calls for unparalleled grades, the industry legend says

A crew operates jumbo rigs to bring
Ivanhoe’s Platreef mine into PGM production.

China’s not alone. Friedland pegs current global population growth at 83 million a year, with a projected 8.5 billion people populating the planet by 2030. Five billion will inhabit urban areas. Forecasts for 2050 show 6.3 billion city-dwellers. But China, notorious for its poisoned atmosphere, “is on an air pollution jihad.” It’s an all-out effort to turn back the “airpocalypse” and, with a command economy, a goal that shall be achieved.

The main target will be the internal combustion engine, responsible for about 60% of urban air pollution, Friedland said. China now manufactures 19 million cars annually, he adds. The country plans to increase output to 60 million, a goal obviously contrary to the war on pollution unless it emphasizes electric vehicles.

Like others, Friedland sees massive disruption as the economics of EVs overtake those of internal combustion engines, a scenario he expects by 2022 or 2023.

Demand for lithium-ion batteries (comprising 4% lithium, 80% nickel sulphate and 15% cobalt) has sent cobalt prices soaring. But bigger EVs will likely rely on hydrogen fuel cells, he pointed out. They’re already used in electric SUVs, pickup trucks, double-decker buses in London, trains in Germany and China, and, expected imminently, autonomous air taxis in Dubai.

Hydrogen fuel cells need PGMs. If only one-tenth of China’s planned EV output used the technology, demand would call for the world’s entire platinum supply, Friedland said.

“I would rather own platinum than gold,” he declared. Additionally, “there’s no platinum central reserve bank to puke out platinum.”

Ivanhoe just happens to have PGMs, about 42 million ounces indicated and 52.8 million ounces inferred, at its 64%-held Platreef project in South Africa.

Unprecedented demand calls for unparalleled grades, the industry legend says

Underground development progresses at the Kansoko mine,
part of the Kamoa copper deposit and adjacent to Kakula.

Electricity for the grid also ranks high among China’s airpocalyptic priorities. A study produced for the United Nations Environment Programme credits the country with a 17% increase in renewable electricity investment last year, most of it going to wind and solar. Almost $103 billion, China’s renewables investment comes to 36% of the world total.

Just as EVs remain more copper-dependent than internal combustion, wind and solar call for much more of the conductive commodity than do other types of electricity generation. Friedland sees additional disruptive demand in easily cleaned copper surfaces now increasingly used in hospitals, care homes, cruise ships and other places where infectious diseases might lurk.

He sees a modest copper supply deficit now, with a crisis possibly starting as soon as 2019. The world needs a new generation of copper mines, he said, repeating his unkind comparison of today’s low-grade, depleting mines to “little old ladies waiting to die.” The world’s largest producer, the BHP Billiton NYSE:BHP/Rio Tinto NYSE:RIO Escondida mine in Chile, is down to a 0.52% grade.

Copper recently hit a two-year high of about $6,400 a tonne. But, citing Bernstein data, Friedland said new mines would require a $12,000 price.

Not Kamoa-Kakula, though. He proudly noted that, with an indicated resource grading 6.09%, it hosts “the richest conceivable copper deposit on this planet.”

I’ve never been as bullish in my 35 years on a project.—Robert Friedland

A JV with Ivanhoe and Zjin Mining Group each holding 39.6% and the DRC 20%, Kamoa-Kakula inspires “a plethora of superlatives.” The veteran of Voisey’s Bay and Oyu Tolgoi added, “I’ve never been as bullish in my 35 years on a project.”

The zillionaire likes zinc too, which his company also has in the DRC at the 68%-held Kipushi project. With a measured and indicated grade of 34.89%, the Big Zinc zone more than doubles the world’s next-highest-grade zinc project, according to Ivanhoe. There’s copper too, with three other zones averaging an M&I grade of 4.01%.

“Everything good in the Congo starts with a ‘K’,” he said enthusiastically.

But recklessly, in light of the DRC’s controversial Kabila family. In June Ivanhoe was hit by reports that the company has done deals with businesses held by the president’s brother, Zoe Kabila, although no allegations were made of wrongdoing.

The family has run the country, one of Africa’s poorest, since 1997. Current president Joseph Kabila has been ruling unconstitutionally since November, a cause of sometimes violent protest that threatens to further destabilize the DRC.

As the New York Times reported earlier this month:

An implosion of the Democratic Republic of Congo, a country almost the size of western Europe, could spill into and involve some of the nine countries it borders. In the late 1990s, neighbouring countries were sucked into what became known as the Great War of Africa, which resulted in several million deaths.

Friedland’s nearly hour-long address made no mention of jurisdictional risk. But the audience of hundreds, presumably most of them retail investors, responded warmly to the serial success story. He’s the one who, after Ivanhoe languished at five-year lows in early 2016, propelled the stock more than 300% over the last 12 months.

King’s Bay prepares for Newfoundland copper-cobalt field program

July 26th, 2017

by Greg Klein | July 26, 2017

Update: Effective August 14, 2017, King’s Bay Gold begins trading as King’s Bay Resources TSXV:KBG.

Copper-cobalt findings dating to the 19th century have King’s Bay Gold TSXV:KBG about to begin Phase I exploration on its Trump Island project off Newfoundland’s northern coast. The company has a team ready to study historic data prior to geophysics and grab sampling on the 200-hectare property. Depending on results, Phase II could incorporate drilling.

King’s Bay prepares for Newfoundland copper-cobalt field program

The property’s exploration history dates to 1863, when a Cornish miner sunk a six-metre shaft to follow a zone of massive chalcopyrite. Mineralization reportedly expanded with depth but the technology of the time prevented further excavation. Nevertheless the Cousin Jack reportedly shipped to Wales high-grade copper-cobalt material archaically recorded as “40 pounds per fathom.”

Grab samples collected near the shaft in 1999 showed historic, non-43-101 results up to 3.8% copper, 0.3% cobalt, 2.9 g/t gold and 10.9 g/t silver.

Located seven miles south of the town of Twillingate, Trump Island has boat access to a highway 1.5 kilometres away.

Last month King’s Bay reported geophysical results from another copper-cobalt project, this one along a provincial highway in Labrador. Airborne VTEM over the 24,000-hectare Lynx Lake property revealed a shallow anomaly of high resistivity about 400 metres in diameter and 50 to 300 metres in depth. The results came from the project’s West Pit, where historic, non-43-101 grab samples showed up to 1.03% copper, 0.566% cobalt, 0.1% nickel, 5 g/t silver, 0.36% chromium, 0.39% molybdenum and 0.23% vanadium.

Lynx Lake’s summer agenda includes higher-resolution ground geophysics, possible stripping to expose bedrock south of the pit and follow-up work on historic soil samples on the property’s southeastern area, along with mapping and sampling over both areas.

The company’s portfolio also includes three Quebec properties with historic, non-43-101 cobalt results.

Earlier this month King’s Bay closed a first tranche totalling $316,250 of a private placement offered up to $725,000. The company expects to close the second tranche by the end of August. King’s Bay closed a previous financing of $938,752 in January.

Read about cobalt supply and demand.

See an infographic about cobalt.

Castle Silver Resources adds gold to cobalt-silver assays, expands drilling at Ontario past-producer

July 19th, 2017

by Greg Klein | July 19, 2017

As underground mini-bulk sampling brings high-grade results, Castle Silver Resources TSXV:CSR has increased its surface drill program at a former mine near Ontario’s Cobalt camp. An 82-kilogram sample of vein material taken near a first-level adit graded 1.48% cobalt, 5.7 g/t gold and 46.3 g/t silver. Nickel values are pending. Meanwhile the Phase I surface drill program that began earlier this month with a 1,500-metre goal has been increased to 2,000 metres in approximately 20 holes.

Castle Silver Resources adds gold to cobalt-silver assays, expands drilling at Ontario past-producer

Visible cobalt from a vein on Castle
Silver Resources Beaver project.

The gold grades have the company re-checking a previous batch of chip samples that weren’t assayed for the yellow metal. The company’s also extracting another sample from the same area to verify the results.

Castle Silver noted that the samples are “selective and should not be considered representative of mineralization underground or elsewhere on the property.”

Eighty kilometres southeast, Castle Silver has been collecting surface samples on its 100%-optioned Beaver project, another former silver mine with cobalt potential. Samples taken in 2013 from waste rock left by historic extraction graded 7.98% cobalt, 3.98% nickel and 1,246 g/t silver.

On closing a $882,500 financing last week, the company’s private placement total has hit nearly $2.6 million since March.

Read more about Castle Silver Resources here and here.

Castle Silver Resources begins surface drilling at Ontario cobalt project

July 11th, 2017

by Greg Klein | July 11, 2017

With cobalt prices soaring at record levels, Castle Silver Resources TSXV:CSR opens a new front in its quest for the coveted commodity. The company has begun an “aggressive” 1,500-metre program at the Castle past-producer, where cobalt potential was downplayed by previous silver mining operations. This campaign will be carried out from surface within 200 metres of the former mine’s portal, the company stated.

Castle Silver Resources begins surface drilling at Ontario cobalt project

Last month the company released assays from 200 kilograms of underground chip samples taken just inside the portal, with selected samples grading as high as 1.8% cobalt, 8.6% nickel and 25.2 g/t silver. Underground sampling was continuing, Castle Silver reported.

Some of the material will undergo tests with the company’s proprietary Re-2OX hydrometallurgical process to produce cobalt powder samples for end-user evaluation. The company also sees potential for Re-2OX to recover lithium and cobalt from Li-ion batteries.

To help guide the current drill program, Castle Silver gleaned 3D data from a cavity monitoring survey of the former mine’s first level, one of 11 levels in an operation that produced about 9.5 million ounces of silver and 299,847 pounds of cobalt during intermittent extraction between 1917 and 1988.

The 3,252-hectare property lies about 80 kilometres northwest of Ontario’s historic Cobalt camp. Within the camp itself, Castle Silver holds a 100% option on the Beaver and Violet cobalt-silver properties and their former mines.

On June 15 the company closed the final tranche of an over-subscribed private placement that totalled $1.2 million.

London Metal Exchange prices currently peg cobalt at $59,500 a tonne, up from $32,750 at the beginning of the year. In April Benchmark Mineral Intelligence analyst Caspar Rawles told a Vancouver audience that the Democratic Republic of Congo produces 64% of global cobalt mined supply while China produces 57% of refined supply.

Berkwood Resources adds lithium to Quebec energy metals portfolio

July 11th, 2017

by Greg Klein | July 11, 2017

Seeing lithium potential in the gold-laden Abitibi, Berkwood Resources TSXV:BKR announced a 3,064-hectare acquisition called the Delbreuil project on July 11. Located in a region known for lithium showings, the property features spodumene-hosting pegmatites and historic lithium assays.

Berkwood Resources adds lithium to Quebec energy metals portfolio

One historic, non-43-101 result from a pegmatite sample graded 1,290 ppm lithium and 126 ppm tantalum. Historic drilling also brought results for zinc, nickel, copper, silver and cobalt. Satellite imagery suggests multiple outcrops have high potential for hosting additional pegmatite intrusions, the company added.

Now being planned is Delbreuil’s first lithium-specific program, with Phase I field work to include prospecting, mapping and till sampling.

Subject to approvals, Berkwood gets the road-accessible project for 2.1 million shares and $15,000.

The property would complement Berkwood’s portfolio of energy metals projects in Quebec. Last month the company announced an agreement to acquire the Cobalt Ford property in the infrastructure-rich Côte-Nord region. Previous work on the 2,176-hectare property revealed three base metals showings as well as historic, non-43-101 samples of 904 ppm and 1,480 ppm cobalt.

Last year’s work on the company’s Lac Gueret South graphite project, meanwhile, produced grab samples from Zone 1 averaging 4.99% carbon-as-graphite within a range of 0.04% to 36.3% Cgr in the vicinity of large geophysical anomalies. The property’s located about three hours by road from the city of Baie-Comeau.

Visual Capitalist: How commodities performed in H1 and why they’re very cheap

July 5th, 2017

by Jeff Desjardins | posted with permission of Visual Capitalist | July 5, 2017

If you’re looking for action, the commodities sector has traditionally been a good place to find it.

With wild price swings, massive up-cycles, exciting resource discoveries and extreme weather events all playing into things, there’s rarely a dull day in the sector. That being said, it’s hard to remember a more lacklustre period for commodities than the last couple of years.

For commodity bulls, the good news is that the sector is no longer tanking. The bad news, however, is that all the recent action has been in relatively niche sectors, as metals like cobalt, zinc and lithium all have their day in the sun.

At the same time, the big commodities (gold, oil, copper) have all slid sideways, having yet to revisit their former periods of glory.

Commodity winners so far

Before we highlight why commodities could still be cheap, let’s look at recent performance to get some context. Here are the commodities that have positive returns in H1 2017 so far:

How commodities performed in H1 and why they’re very cheap

 

Palladium is the best performer in 2017 so far, and it has now almost passed platinum in price. That would be the first time since 2001 that this has happened, and for the stretch of 2007 to 2012 it was even true that palladium traded at a $1,000 deficit to platinum.

Agricultural goods like rough rice, lean hogs, oats and wheat have also gotten more expensive so far this year. Meanwhile, metals like gold, copper and silver have seen modest gains—but only after dismal performances in the last part of 2016.

The losers so far

Here is the scoreboard for the commodities in negative territory, with the most noticeable losses in sugar and energy.

How commodities performed in H1 and why they’re very cheap

 

Are commodities cheap?

From the post-crisis bottom in 2009 until today, the S&P 500 is up a staggering 215.4%.

During that same timeframe, most major commodities crashed and then went sideways. The Goldman Sachs Commodity Index (GSCI) is down roughly 31.2%, which is a strong juxtaposition to how equities have done.

This extreme divergence can be best seen in this long-term chart, which compares the two indices since 1971.

How commodities performed in H1 and why they’re very cheap

 

In other words: Despite the lack of action in commodities that we noted earlier, the sector has never been cheaper relative to equities, even going back 45 years.

That means that there could be some much-needed action soon.

Posted with permission of Visual Capitalist.

Newfoundland newly found

June 26th, 2017

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

 

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

Isabel Belger

Isabel: I would like to introduce Jon Armes, the president and CEO of Kapuskasing Gold TSXV:KAP. Jon, good to see you again. Tell us something about your background to start with.

Jon: Hi Isabel, good to see you too. I started in the mineral exploration business back in 1993 as an investor relations consultant. I spent the better part of 10 years working for various companies exploring for gold and precious metals as well as base metals and diamonds.

In the mid-2000s I ended up working in the field alongside a couple of different geologists and spent time managing drill programs, splitting drill core, prospecting and assisting in the staking of claims. I also helped structure some companies—bringing project opportunities and public companies together.

In 2010 I was given the opportunity to run a junior exploration company called Lakeland Resources. That company merged with Alpha Exploration in late 2015 and became ALX Uranium [TSXV:AL]. I remained as president until October of 2016 after concluding a transaction with Denison [TSX:DML] on behalf of ALX.

I was appointed president of Kapuskasing Gold in February of 2016. We carried out some drilling last summer on a gold project in Timmins, Ontario, but unfortunately did not intersect anything of significance in that campaign. Since that time I have been looking for the right opportunity or opportunities to bring in to the Kapuskasing property portfolio. The Newfoundland property package seemed like the right fit, and since then we have done some consolidating to the original acquisitions announced on March 1, 2017, and then more recently added the Daniel’s Harbour zinc property to the property portfolio. The copper-cobalt projects are the Lady Pond property and the King’s Court property. The lack of systematic testing for cobalt gave rise to these properties being so interesting because, the few times cobalt was tested for, there were several anomalous values. I particularly like the short- and longer-term outlook for both copper and zinc, and these copper-cobalt projects also provide a polymetallic exposure that includes cobalt, gold and silver.

Isabel: Congratulations on your recent zinc property acquisition in Newfoundland, the Daniel’s Harbour property. What intrigued you about this project?

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

With breathtaking geography and bountiful geology, the Rock
and neighbouring Labrador hold potential for Kapuskasing.

Jon: The opportunity to acquire a project that was a past-producer is always an interesting one. There is an old saying in the mining business that the best place to look for a mine or a deposit is in the “shadow of a headframe.” The Mississippi Valley-type nature of these zinc deposits is also intriguing because of the difficulty in finding them. Typically they are found in an outcrop as was the case for the majority of the lenses that were mined out between 1975 and 1990. I am of the belief that there is an opportunity to find more of these lenses within the boundary of the current Daniel’s Harbour zinc property. The fact that Altius [TSX:ALS] has acquired a significant land position within the immediate area of this project only helps to reaffirm my belief. We will do some compilation of the historic work and more recent exploration on the property and incorporate some out-of-the-box thinking on how to employ some geophysics that have either not been used before or perhaps some re-interpretation. Another aspect could be a ground prospecting program that may identify an outcrop or showing on the property that has yet to be found.

Isabel: What are your exploration plans for the coming months?

Jon: Kapuskasing is currently undertaking a small financing to assist in getting things going both on the Daniel’s Harbour property and the Lady Pond copper-cobalt project. As mentioned, the first things for Daniel’s Harbour would be some data compilation and to identify some geophysical techniques to help identify some drill targets.

The Lady Pond copper-cobalt property has a drill-ready target area called the Twin Pond prospect, recently acquired to complete the consolidation of the original Lady Pond property package. We have also staked several claims to cover additional historic showings of copper-cobalt-gold and silver. The Twin Pond prospect has a non-43-101 resource of approximately one million tonnes grading 1% copper, and looks to be open in all directions. [We hope to increase this resource] with a properly designed drill program—ideally in the coming months with the right funding and availability of service companies to carry out the work.

In the immediate area of Lady Pond, there are several past-producing mines and undeveloped prospects that could turn into economic deposits…. Rambler Metals [TSXV:RAB] has several projects and properties in this area, including the Little Deer project contiguous to our Lady Pond property. There is potential with the right combination of funding and exploration success for Kapuskasing to find more than one of these deposits within the Lady Pond property, having had a good start with the Twin Pond prospect.

Isabel: How much of Kapuskasing is held by the management?

Jon: Currently insiders and parties close to the company own approximately 20% of the issued and outstanding shares. Typically the insiders participate in the financings, as will be the case in this one. We are currently looking to raise up to $750,000 in a combination of flow-through and common shares. We hope to close a first tranche financing in the coming weeks to begin deploying exploration capital.

Isabel: What is your favourite commodity besides the ones in your company?

Kapuskasing will be in a great position to take advantage of not just one but several commodity price spikes, the first of which I think will be in both copper and zinc. —Jon Armes

Jon: I do like both copper and zinc, as evidenced by the recent acquisitions. The battery technology metals are also interesting—with cobalt and lithium leading the latest charge. People forget that electricity needs copper. Wires transport the electricity from batteries and generators to the tool or outlet. I consider copper to be the most important metal for the energy metal sector. We have cobalt as a possible byproduct of the two main polymetallic projects in the Lady Pond and King’s Court projects, along with gold, silver and zinc. Kapuskasing will be in a great position to take advantage of not just one but several commodity price spikes, the first of which I think will be in both copper and zinc.

Isabel: What do you like most about your job?

Jon: I like the multifaceted aspects of running a junior exploration program; there never seems to be a dull moment. I get to meet a lot of different people in the mining and finance industry, the prospectors that generate the project ideas, and the service people that ultimately carry out the exploration of the projects with our team of geologists and technicians. The most exciting times are when we are actually carrying out a drill program. It is drilling that ultimately leads to discovery.

Isabel: That is right. Good talking to you Jon, and good luck with the drill program.

Jon: Thank you.

 

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

Jon Armes
president/CEO of
Kapuskasing Gold

Bio

Jonathan Armes, also known as Jon, has been the CEO and president of Kapuskasing Gold since February 9, 2016, and a director since October 8, 2014. Jon Armes has been a consultant of ALX Uranium since October 2016. Jon Armes served as the president/CEO of ALX Uranium (formerly, Lakeland Resources) from August 12, 2010, until October 2016. He has provided corporate development and investor relations services to mining exploration companies for over 15 years including Band-Ore Resources (which became part of Lake Shore Gold, which in turn joined Tahoe Resources TSX:THO) and Trelawney Mining and Exploration, an IAMGOLD TSX:IMG takeover. He graduated from the University of Guelph in 1993 with a Bachelor of Applied Science degree.

Fun facts

My hobbies: Fishing, hockey and music
Sources of news I use: News apps on my phone
My favourite airport: Vancouver
My favourite commodities: Copper, gold, zinc, cobalt
My favourite tradeshow: PDAC
With this person I would like to have dinner: Warren Buffet (talking about philanthropy, investing and life)
If I could have a superpower, it would be: Seeing into the future


Read more about Kapuskasing Gold.

Geophysical anomaly heightens King’s Bay interest in Labrador cobalt project

June 19th, 2017

by Greg Klein | June 19, 2017

Update: Effective August 14, 2017, King’s Bay Gold begins trading as King’s Bay Resources TSXV:KBG.

Newly analyzed data has King’s Bay Gold TSXV:KBG planning to resume its search for copper and cobalt beside the Trans-Labrador Highway. Results from last winter’s 382-line-kilometre airborne VTEM survey over the Lynx Lake project reveal a shallow anomaly of high resistivity estimated at about 400 metres in diameter and 50 to 300 metres in depth. The finding comes from the property’s West Pit, where historic, non-43-101 grab samples assayed up to 1.03% copper, 0.566% cobalt, 0.1% nickel, 5 g/t silver, 0.36% chromium, 0.39% molybdenum and 0.23% vanadium.

Geophysical anomaly heightens King’s Bay interest in Labrador cobalt project

Cutting right through the property, the highway offers year-round access to the town of Happy Valley-Goose Bay, about 1.5 hours
away. Powerlines are under construction along the northern
part of the property.

Summer plans now call for higher-resolution ground geophysics over the target area, potentially followed by overburden stripping to expose bedrock south of the pit. The crew will also follow up on historic soil sample anomalies on the property’s southeastern area. Detailed mapping and sampling will cover both areas.

Interest began in the property as the highway was being built in 2008. A contractor with prospecting experience noticed disseminated and massive sulphides beside the new route. Along with the West Pit results, grab samples east of the highway brought non-43-101 results up to 1.39% copper, 0.94% cobalt, 0.21% nickel and 6.5 g/t silver.

Lynx Lake began as a 2,000-hectare acquisition which King’s Bay expanded to about 24,000 hectares following a review of data from government regional low-resolution magnetic surveys and preliminary handheld EM surveys.

The quest for cobalt has led King’s Bay to other acquisitions. In February the company announced a 100% option on the Trump Island copper-cobalt property in Newfoundland. Earlier that month King’s Bay picked up three Quebec properties with historic, non-43-101 cobalt sampling results.

The company closed a $938,752 private placement in January.

Read about cobalt supply and demand.

See an infographic about cobalt.

Benchmark Mineral Intelligence analyst Caspar Rawles sees opportunity for new sources of cobalt despite growing reliance on Congo supply

June 15th, 2017

…Read more