Monday 23rd April 2018

Resource Clips


Posts tagged ‘cobalt’

Copper crusader

December 29th, 2017

Gianni Kovacevic sees even greater price potential for the conductive commodity

by Greg Klein

Evangelist he may be, but Gianni Kovacevic’s hardly a voice crying in the wilderness. His favourite metal displayed stellar performance last year, reaching more peaks than valleys as it climbed from about $2.50 to nearly $3.30 a pound. But Kovacevic believes copper has a long way to go yet. That will be a function of necessity as the metal shows “the strongest demand growth of any of the major commodities.” Especially persuasive in his optimism, Kovacevic brings his message to the 2018 Vancouver Resource Investment Conference on January 21 and 22.

Gianni Kovacevic sees even greater price potential for the conductive commodity

Increasing copper demand will unlock
lower-grade resources, says Kovacevic.

As a researcher, commentator and investor who’s also the CEO/chairperson of CopperBank Resources CSE:CBK, co-founder of CO2 Master Solutions Partnership and author of My Electrician Drives a Porsche, he brings new approaches that link topics of energy demand, commodity supply and environmental stewardship.

Kovacevic sees a new paradigm driving copper’s future. “The invisible hand in commodities during the last cycle was China,” he says. “Its economic growth just came out of nowhere. This time the invisible hand is this pervasive use of copper in everything that’s electrified. That means even the smallest village in Africa, which per capita has negligible copper consumption, is becoming a line item. When you create, transfer and utilize greener and cleaner energy, it takes more copper by a power of magnitude. For example to establish a megawatt of windpower it takes five times more copper than it does a megawatt of conventional thermal-generated energy.”

Then there’s the battery-powered revolution and the attention it’s brought to lithium, cobalt and graphite. Saying “I like anything in electric metals,” Kovacevic stresses the importance of nickel as well. Still, “copper wins because the interconnectivity will always be copper and copper plays a role in each battery as well.”

That leads to a supply problem that can have only one solution. “I believe we’re going to have to make uneconomic deposits economic. And there’s only one way to do that—with a higher copper price.”

With no foreseeable hope of a copper mining “renaissance” comparable to the effect that fracking brought to oil and gas, the metal will simply require more money. “We’ve got the old legacy mines,” Kovacevic points out. “We’ve spent a lot of money on exploration in the last cycle and didn’t find a lot. What we do have is lower-grade resources. They are simply not economic at a low copper price.”

Gianni Kovacevic sees even greater price potential for the conductive commodity

Kovacevic: Electrical generation, storage and
connectivity put copper at the top of energy metals.

Apart from diminishing grades, the business of putting new mines into operation is “taking longer with water, electricity and permitting issues, and it’s getting into funkier places,” he continues. “The Elliott Wave [technical/fundamental analysis] on copper is $7.50 a pound. I find that very interesting. All the buy-out action in the copper space happened for the most part between 2006 and 2012. The mean price for copper during that time was about $3.50 a pound. The all-time high was about $4.50 for a short while, but the mean was $3.50.”

Copper’s 2017 performance makes that figure look viable again. Kovacevic, however, cites analysis from BHP Billiton NYSE:BHP stating that 75% of future projects will require more than $3.50. “Could we see a scenario in which the copper price goes past the old all-time high and stays there for a while? And will the buy-outs in the next wave, if they occur, be higher on average than those in the previous 2006-to-2012 cycle? I believe the answer will be yes. But if you look at the average grade that went through the top 15 copper producers’ mills in 2010, it was 1.2% copper. In 2016 it was 0.72% copper. So if you were mining 30 million tonnes a year, now you have to mine 40 or 45 million tonnes for the same metal yield. And without higher copper prices, that doesn’t make much of a business case.

“So the first question is, are we going to need more copper in the next five, 10, 15 years? The answer in my opinion is yes. In fact it has the strongest demand growth of any of the major commodities. And where will that copper come from? Well, it’s going to come from a mix of places but we’ll have to make these projects economic. That should bode well for people who have invested in the copper junior space.”

Addressing the topic of how investors might look at the energy revolution in 2018 and beyond, Kovacevic speaks at the 2018 Vancouver Resource Investment Conference, to be held at the Vancouver Convention Centre West from January 21 to 22. Click here for more details and free registration.

Critical attention

December 21st, 2017

The U.S. embarks on a national strategy of greater self-reliance for critical minerals

by Greg Klein

A geopolitical absurdity on par with some aspects of Dr. Strangelove and Catch 22 can’t be reduced simply through an executive order from the U.S. president. But an executive order from the U.S. president doesn’t hurt. On December 20 Donald Trump called for a “federal strategy to ensure secure and reliable supplies of critical minerals.” The move came one day after the U.S. Geological Survey released the first comprehensive update on the subject since 1973, taking a thorough look—nearly 900-pages thorough—at commodities vital to our neighbour’s, and ultimately the West’s, well-being.

U.S. president Trump calls for a national strategy to reduce foreign dependence on critical minerals

The U.S. 5th Security Forces Squadron takes part in a
September exercise at Minot Air Force Base, North Dakota.
(Photo: Senior Airman J.T. Armstrong/U.S. Air Force)

The study, Critical Mineral Resources of the United States, details 23 commodities deemed crucial due to their possibility of supply disruption with serious consequences. Many of them come primarily from China. Others originate in unstable countries or countries with a dangerous near-monopoly. For several minerals, the U.S. imports its entire supply.

They’re necessary for medicine, clean energy, transportation and electronics but maybe most worrisome, for national security. That last point prompted comments from U.S. Secretary of the Interior Ryan Zinke, whose jurisdiction includes the USGS. He formerly spent 23 years as a U.S. Navy SEAL officer.

“I commend the team of scientists at USGS for the extensive work put into the report, but the findings are shocking,” he stated. “The fact that previous administrations allowed the United States to become reliant on foreign nations, including our competitors and adversaries, for minerals that are so strategically important to our security and economy is deeply troubling. As both a former military commander and geologist, I know the very real national security risk of relying on foreign nations for what the military needs to keep our soldiers and our homeland safe.”

Trump acknowledged a number of domestic roadblocks to production “despite the presence of significant deposits of some of these minerals across the United States.” Among the challenges, he lists “a lack of comprehensive, machine-readable data concerning topographical, geological and geophysical surveys; permitting delays; and the potential for protracted litigation regarding permits that are issued.”

[Trump’s order also calls for] options for accessing and developing critical minerals through investment and trade with our allies and partners.

Trump ordered a national strategy to be outlined within six months. Topics will include recycling and reprocessing critical minerals, finding alternatives, making improved geoscientific data available to the private sector, providing greater land access to potential resources, streamlining reviews and, not to leave out America’s friends, “options for accessing and developing critical minerals through investment and trade with our allies and partners.”

Apart from economic benefits, such measures would “enhance the technological superiority and readiness of our armed forces, which are among the nation’s most significant consumers of critical minerals.”

In fact the USGS report finds several significant uses for most of the periodic table’s 92 naturally occurring elements. A single computer chip requires well over half of the table. Industrialization, technological progress and rising standards of living have helped bring about an all-time high in minerals demand that’s expected to keep increasing, according to the study.

“For instance, in the 1970s rare earth elements had few uses outside of some specialty fields, and were produced mostly in the United States. Today, rare earth elements are integral to nearly all high-end electronics and are produced almost entirely in China.”

The USGS tracks 88 minerals regularly but also works with the country’s Defense Logistics Agency on a watch list of about 160 minerals crucial to national security. This week’s USGS study deems the critical 23 as follows:

  • antimony
  • barite
  • beryllium
  • cobalt
  • fluorite or fluorspar
  • gallium
  • germanium
  • graphite
  • hafnium
  • indium
  • lithium
  • manganese
  • niobium
  • platinum group elements
  • rare earth elements
  • rhenium
  • selenium
  • tantalum
  • tellurium
  • tin
  • titanium
  • vanadium
  • zirconium

A January 2017 USGS report listed 20 minerals for which the U.S. imports 100% of its supply. Several of the above critical minerals were included: fluorspar, gallium, graphite, indium, manganese, niobium, rare earths, tantalum and vanadium.

This comprehensive work follows related USGS reports released in April, including a breakdown of smartphone ingredients to illustrate the range of countries and often precarious supply chains that supply those materials. That report quoted Larry Meinert of the USGS saying, “With minerals being sourced from all over the world, the possibility of supply disruption is more critical than ever.”

As both a former military commander and geologist, I know the very real national security risk of relying on foreign nations for what the military needs to keep our soldiers and our homeland safe.—Ryan Zinke,
U.S. Secretary of the Interior

David S. Abraham has been a prominent advocate of a rare minerals strategy for Western countries. But in an e-mail to the Washington Post, the author of The Elements of Power: Gadgets, Guns, and the Struggle for a Sustainable Future in the Rare Metal Age warned that Trump’s action could trigger a partisan battle. He told the Post that Republicans tend to use the issue to loosen mining restrictions while Democrats focus on “building up human capacity to develop supply chains rather than the resources themselves.”

Excessive and redundant permitting procedures came under criticism in a Hill op-ed published a few days earlier. Jeff Green, a Washington D.C.-based defence lobbyist and advocate of increased American self-reliance for critical commodities, argued that streamlining would comprise “a positive first step toward strengthening our economy and our military for years to come.”

In a bill presented to U.S. Congress last March, Rep. Duncan Hunter proposed incentives for developing domestic resources and supply chains for critical minerals. His METALS Act (Materials Essential to American Leadership and Security) has been in committee since.

Speaking to ResourceClips.com at the time, Abraham doubted the success of Hunter’s bill, while Green spoke of “a totally different dynamic” in the current administration, showing willingness to “invest in America to protect our national security and grow our manufacturing base.”

Update: Read about Jeff Green’s response to the U.S. national strategy.

“Shocking” USGS report details 23 minerals critical to America’s economy and security

December 19th, 2017

This story has been expanded and moved here.

King’s Bay Resources samples 6% copper in Newfoundland, awaits Labrador cobalt assays

December 15th, 2017

by Greg Klein | December 15, 2017

A three-day Phase I field program in northern Newfoundland brought encouraging copper grades for King’s Bay Resources’ (TSXV:KBG) Trump Island project. Out of 15 samples taken from outcrop, four surpassed an upper detection limit of 1% copper, with results showing:

King’s Bay Resources samples 6% copper in Newfoundland, awaits Labrador cobalt assays

  • >10,000 ppm copper, 303 ppm cobalt and >6 ppm silver

  • >10,000 ppm copper, 1,213.6 ppm cobalt and 21.1 ppm silver

  • >10,000 ppm copper, 634.5 ppm cobalt and 27.4 ppm silver

  • >10,000 ppm copper, 272.3 ppm cobalt and 28.7 ppm silver

With those numbers from aqua regia digestion Ultratrace ICP-MS analysis, King’s Bay sent the first sample to a second lab for additional tests using ICP and ore grade analysis, with the following result:

  • 6.07% copper, 0.03% cobalt and 14.4 ppm silver

Grab samples don’t represent the entire property, King’s Bay cautioned. But the company sees further exploration warranted for next spring. The boat-accessible property’s historic work dates to historic times, when in 1863 a miner from Cornwall reportedly extracted a supply of copper and cobalt for shipment to Wales. Non-43-101 results from 1999 grab sampling near the Cousin Jack’s mineshaft showed 3.8% copper, 0.3% cobalt, 2.9 g/t gold and 10.9 g/t silver. The 200-hectare property has yet to be drilled.

Last month King’s Bay wrapped up an initial two-hole, 502-metre program at its Lynx Lake cobalt project in Labrador. Assays are expected in early January but the company reported intervals of net textured gabbro totalling 164.3 metres, along with a 14.9-metre intercept of mineralized biotite gabbro. The holes targeted the West Pit area, where the company anticipates a VTEM anomaly to range from 50 to 300 metres’ depth and about 400 metres in diameter. A highway and powerlines run through the 24,000-hectare property.

King’s Bay offered a $250,000 private placement in September.

Castle Silver Resources’ Frank Basa sees cobalt exploration bringing new interest to a former silver mine

December 12th, 2017

…Read more

Castle Silver Resources samples 4.7% at a second Ontario cobalt project

December 9th, 2017

by Greg Klein | December 9, 2017

Update: Effective February 23, 2018, Castle Silver Resources begins trading as Canada Cobalt Works TSXV:CCW.

Recent work at the former Beaver mine shows why some Ontario silver past-producers have attracted Castle Silver Resources TSXV:CSR in its quest for cobalt. An initial field program collected three composite samples averaging 4.68% cobalt, 3.09% nickel, 46.9 g/t silver and 0.08 g/t gold.

Castle Silver Resources samples 4.7% at a second Ontario cobalt project

The individual breakdowns come to:

  • 4.746% cobalt, 3.985% nickel, 37.4 g/t silver and 0.06 g/t gold

  • 4.743% cobalt, 4.624% nickel, 26.9 g/t silver and 0.09 g/t gold

  • 4.554% cobalt, 0.676% nickel, 76.5 g/t silver and 0.09 g/t gold

The three composites came from selected hand-cobbed material gathered at surface and weighing a total of 38.7 kilograms. The samples don’t necessarily reflect the property’s mineralization, Castle Silver cautioned.

Located near the town of Cobalt and within the eponymous camp known for high-grade silver, Beaver shows similarities to Castle, another former silver mine and the company’s flagship, 80 kilometres to the northwest. Last week the company released assays from underground mini-bulk sampling at Castle that graded up to 3.1% cobalt. In November Castle Silver announced a drill intercept of 1.55% cobalt over 0.65 metres from the same property, the first assay from a summer drill program that sunk 22 holes totalling 2,405 metres. More assays are pending for both surface drilling and underground sampling.

The company also holds the former Violet silver-cobalt mine proximal to Beaver.

Noting an obvious discrepancy between Castle Silver’s moniker and its commodity of choice, president/CEO Frank Basa said the February AGM will consider a name change to “further build CSR’s brand in the Canadian cobalt sector with the company holding unique competitive advantages in the northern Ontario Cobalt region, including underground access at Castle and a proprietary metallurgical process (Re-2OX).”

Castle Silver Resources grades 3.1% cobalt from underground sampling in Ontario

December 1st, 2017

by Greg Klein | December 1, 2017

Update: Effective February 23, 2018, Castle Silver Resources begins trading as Canada Cobalt Works TSXV:CCW.

Historically the northeastern Ontario region was known for a precious metal but more recent activity focuses on an energy metal. Cobalt sampling from a former mine “supports our original thesis that past operators may have left much behind at Castle in their strict focus on mining high-grade silver,” stated Castle Silver Resources TSXV:CSR president/CEO Frank Basa. On December 1 the company released more assays from ongoing underground sampling in the past-producer’s first level.

Castle Silver Resources grades 3.1% cobalt from underground sampling in Ontario

An adit seen from the Castle mine’s first of 11 levels
totalling about 18 kilometres of underground development.

Results for two mini-bulk samples graded:

  • 3.124% cobalt, 21 g/t silver and 0.128% nickel

  • 1.036% cobalt, 12.7 g/t silver and 0.117% nickel

A composite from the two samples showed:

  • 2.323% cobalt, 68.7 g/t silver and 0.355% nickel

More assays are pending.

Last month Castle Silver released the first assay from a 2,405-metre summer drill program that the company said found mineralization in all of the 22 holes. The near-surface intercept graded 1.55% cobalt, 0.65% nickel, 0.61 g/t gold and 8.8 g/t silver over 0.65 metres.

Also in November the company teamed up with Granada Gold Mine TSXV:GGM to announce a provisional milling agreement for a plant that would be located on Castle Silver’s property near the town of Gowganda, about 204 kilometres by road from the Granada project. Granada has a 2014 pre-feasibility study and a June resource update.

Southeast of Gowganda and within Ontario’s Cobalt camp, Castle Silver also holds the past-producing Violet and Beaver mines.

Belmont Resources adds New Brunswick zinc-copper to Nevada lithium

November 23rd, 2017

by Greg Klein | November 23, 2017

Today’s geophysics can “see” what older technology missed, opening up new opportunities in exploration. That’s partly what attracted Belmont Resources TSXV:BEA to its new acquisition, the Mid Corner-Johnson Croft zinc-copper prospect in New Brunswick. While powerlines interfered with 1960s-era geophysics, the company expects accurate results from modern ground electromagnetic and/or gravity surveys.

Belmont Resources adds New Brunswick zinc-copper to Nevada lithium

A single sample of breccia taken in 1970 brought historic, non-43-101 assays of 0.96% cobalt and 16.04% zinc, along with silver, cadmium, copper and lead. A few 1990s samples included non-43-101 results of 1.66% zinc, 2% zinc and 1.04% zinc, with some gold, silver, copper, lead and cadmium.

The 700-hectare property has paved road access as well as the transmission line.

Belmont plans to review all historic data prior to field work that would begin next year. Meanwhile the company remains focused on its Kibby Basin lithium project in Nevada, 65 kilometres north of Clayton Valley. Belmont plans EM, vertical electrical sounding and/or geothermal probe surveys to identify targets for the flagship’s next phase of drilling.

The New Brunswick acquisition costs Belmont two million shares and $10,000 over one year. The company may buy back a 1% NSR out of an existing 2.5% NSR.

Belmont also announced its intention to apply for a TSXV price waiver for a proposed private placement of up to $300,000.

Read Isabel Belger’s interview with Belmont Resources CFO/director Gary Musil.

Castle Silver Resources drills 1.55% cobalt over 0.65 metres with nickel, gold and silver in Ontario

November 13th, 2017

by Greg Klein | November 13, 2017

Last summer’s drilling at Ontario’s former Castle mine “intersected mineralization in each and every hole,” Castle Silver Resources TSXV:CSR reported November 13. The one assay released so far hit 1.55% cobalt, 0.65% nickel, 0.61 g/t gold and 8.8 g/t silver over 0.65 metres starting near surface at 3.85 metres in downhole depth. The company estimates true width between 65% and 85%.

Drilling finished in late August when an originally planned 1,500-metre program completed 22 holes totalling 2,405 metres.

Castle Silver Resources drills 1.55% cobalt over 0.65 metres with nickel, gold and silver in Ontario

Castle Silver expanded its summer campaign
from 1,500 metres to 2,405 metres.

“Once again we’ve demonstrated how historical operators overlooked the potential for cobalt, gold and base metals at the Castle mine as they focused exclusively on the extraction of high-grade silver,” said president/CEO Frank Basa.

“We will carry out trenching to follow up on an array of new near-surface targets generated by this drilling in the immediate vicinity of the Castle mine. But our priority now is to complete final preparations to carry out critical trenching and drilling of untested structures on the first level of the mine.”

With intermittent production between 1917 and 1989, the former mine has 11 levels totalling about 18 kilometres of underground workings. “This does not include an unknown extent of drilled vein structures which were never mined, typically due to silver grades below a certain high-grade threshold, for which CSR has records,” the company added.

Using XRF analysis, an independent firm has found potential for high-grade cobalt mineralization within unmined structures along first-level adit drifts and walls. In July Castle Silver released results from an 82-kilogram bulk sample of vein material that showed 1.48% cobalt as well as 5.7 g/t gold and 46.3 g/t silver. As a result, the company re-evaluated five previous chip samples for gold, with results averaging 3.7 g/t. The samples originally assayed 1.06% cobalt, 5.3% nickel and 17.5 g/t silver.

Earlier this month Castle Silver and Granada Gold Mine TSXV:GGM announced a provisional milling agreement for a plant that would be located on Castle Silver’s property in Gowganda, Ontario. About a 204-kilometre drive from Gowganda, Granada’s project reached pre-feas in 2014 and a resource update in June.

Castle Silver closed the final tranche of a private placement totalling $1.2 million in June.

Drilling begins as Kapuskasing tests historic high-grade copper in Newfoundland

November 3rd, 2017

by Greg Klein | November 3, 2017

A non-43-101, historic estimate of about a million tonnes averaging 1% copper has Kapuskasing Gold TSXV:KAP working to prove up a resource at its Lady Pond project in northern Newfoundland. Now underway, the first phase of modern drilling will sink eight to 12 holes totalling about 1,000 metres on the 2,450-hectare property.

Drilling begins as Kapuskasing tests historic high-grade copper in Newfoundland

Recent field work produced high-grade surface
samples from Kapuskasing’s Lady Pond copper project.

Three areas of interest are the Lady Pond prospect, the Twin Pond prospect and the Sterling prospect. The latter hosts a former mine and the historic, non-43-101 estimate that’s reportedly open in all directions. Some previous intercepts from Sterling, again historic and non-43-101, showed:

  • 5.5% copper over 4.42 metres, starting at 38.1 metres in downhole depth

  • 2.32% copper over 6.1 metres, starting at 106.68 metres

  • 1.45% copper over 4.57 metres, starting at 50.29 metres

Recent field work reported last month brought two Lady Pond surface grab samples grading 2.75% and 7.19% copper.

About 1.5 kilometres northeast, Twin Pond underwent 32 holes of drilling without an estimate being calculated. Some historic, non-43-101 highlights include:

  • 4.2% copper over 3.35 metres, starting at 82.3 metres

  • 2.16% copper over 3.05 metres, starting at 33.53 metres

  • 3.2% copper over 3.05 metres, starting at 70.14 metres

A recent grab sample from Twin Pond showed 9.03% copper.

One historic, non-43-101 assay for the Lady Pond prospect, about three kilometres northeast of Twin Pond, recorded 2.61% copper over 8.1 metres. A grab sample from the recent field work showed 0.089% cobalt, 1.54% copper and 9.4 g/t silver.

The property borders the town of Springdale and hosts logging roads and ATV routes. Another 94 kilometres by road sits Rambler Mining and Metals’ (TSXV:RAB) base metals mill. Rambler holds two historic, non-43-101 copper resources contiguous to Lady Pond.

In September Kapuskasing closed an option agreement on Daniel’s Harbour, a 1,050-hectare project on Newfoundland’s Great Northern Peninsula. Between 1975 and 1990, a former mine on the property produced around seven million tonnes averaging 7.8% zinc. The company considers Daniel’s Harbour prospective for additional Mississippi Valley-type deposits.

Just south of the peninsula, Kapuskasing holds the King’s Court copper-cobalt property.

The company closed private placements totalling $215,000 in August and $201,200 in June.

Read Isabel Belger’s interview with Kapuskasing Gold president/CEO Jon Armes.