Alien & Asiamet, Blencowe & Bezant, Energy Pathways & Guardian
How 'bout you Utivich, you make that deal?
Good Afternoon Team.
In the small cap market, there exists a plethora of junior resource companies looking to make a deal.
Because when you’re in this game, there are only three ways to gain any real exit liquidity: asset sales, solo production or Joint Ventures (et al).
And not everyone has the sales skills of the peddler in Disney’s Aladdin. Or are capable of channeling Rowan Atkinson’s Love Actually Persona.
Or very occasionally, employing the charms of 1st Lieutenant Aldo ‘The Apache’ Raine.
But I do want to briefly touch on those companies I’m tracking, all looking to square up a deal of their very own in the very near future.
Starting with:
Alien Metals
UFO is getting there. Yesterday’s RNS brings Alien one step closer to being granted the Mallina tenement adjacent to Hancock, with the Nyiyaparli People consenting to two of the three applications in the existing Mining Agreement.
The Native Title objection period remains open, but following discussions with Native representatives, Alien now expects no objections.
The company is starting an initial field reconnaisance mapping exercise to test the new asset for iron ore - and given the ease of mining Hancock, I remain of the view that it’s only a matter of time before a deal is reached.
However, before this happens, a different Joint Venture regarding Elizabeth Hill is expected to be signed, sealed and delivered by the end of Q1 - and this should come with a significant cash component.
As a reminder, the Elizabeth Hill Silver Mine has a pre-JORC compliant resource of circa 4.05Moz of silver and in the past was once Australia's highest-grade silver mine.
Over 1 million ounces of silver was produced in 1999-2000 from a shaft and on-site processing plant before the mine was closed during a dispute between the previous joint venture partners back in 2000. The mine is now 100% owned outright by Alien, and prior historical drilling has been compiled into a secure geological database.
The main silver mineralisation is located south of the Volcanogenic Massive Sulphide anomalism, which has been targeted with several historical reverse circulation holes. It lies on a structurally controlled fault contact between granite and ultramafic rocks, with the main zone of mineralisation plunging steeply to the south.
Drilling of the interpreted parallel structures is almost certainly the plan once the deal is inked.
It’s also worth noting that Elizabeth Hill has previously recorded values of up to 2.09% — and Alien thinks it could also add gold, platinum and palladium credits to the resource through further exploration.
Get a JV over the line with a cash component, and then sort out Hancock - and one hopes that the share price will sort itself out.
Asiamet
ARS is due an update. The company has reduced its pre-production capex estimate for BKM by S58 million to $176.9 million, including $22 million in project contingency and a further $10 million allowance for project scope growth.
Investors now await an updated feasibility study due in ‘early 2025’ - that is, very shortly. And then it’s FINANCING TIME.
CEO Darryn McClelland has already enthused that getting the capex down is a ‘pivotal achievement for Asiamet’ - and now the proof is in the pudding.
The company is well cashed up given last year’s placing with supportive investor DOID, and as far as I am aware, the only item remaining is the power study - which was received last week.
The final write-up is pretty much there.
On the ground, Asiamet is seeing significant project level interest, especially as the CEO has exercised detail far beyond a standard feasibility study.
Stay tuned.
It’s coming.
Blencowe
BRES just reported positively on an initial hydropower study for its Orom-Cross Graphite Project in Uganda - and an additional 7,000 metres of drilling has kicked off.
The company is in active discussions with OEMs on offtake, and in the words of CEO Mike Ralston, they’re ‘optimistic about translating these discussions into formal agreements. SAFELOOP, in particular, represents a substantial offtake opportunity with premium pricing far above current market rates.’
Get offtakes signed, and you get that much closer to production.
Mike also noted at the recent Mining 121 conference that a ‘shift in value coming.’
Given China’s position on graphite, and its critical mineral status, the DFC funding makes absolute sense.
And with the DFS on track for mid-2025 (including a DFS for the Phase 1 plant and the Phase 3 downstream beneficiation plant as stand-alone projects), project level funding should be in the pipeline.
BRES raised over £1.6 million at 4p per share last November so is well cashed up - the company is hosting a webinar at 6pm today for any questions, here.
Bezant
A couple of weeks ago, Bezant released a very positive ore sorting study from Steinert concerning its Hope & Gorob Copper-Gold Project in Namibia.
The results confirmed previous projections that capital payback can be achieved within less than 20 months of full-scale production, with the study specifically tested mineralisation to be mined within the first three years of production.
For context, the project required a feed grade of 2.4% copper based on previous assumptions - and ore sorting tests returned a feed grade of up to 2.95% copper with substantial gold and silver credits.
The study also revealed a high percentage of chalcocite (arguably the best copper mineral), preferentially reporting to fines generated during crushing due to its high friability.
Beyond this, external resource estimation previously allocated an average gold grade of 0.41 g/t Au to the Hope Resource. The optimisation study returned an average grade of 0.42 g/t Au.
And silver grades significantly exceeded expectations…
Project development later this year - and financing to the tune of perhaps $15 million - is going to make this one generate serious free cash flow should Bird get a JV done in 2025.
I’ve done the maths.
Bezant raised £560,000 at the start of the year and has also just sold a non-core asset for $220,000 - so has the runway to get a deal signed.
Energy Pathways
Yesterday, EPP took a giant leap forward in its financing journey - signing a non-binding memorandum of understanding with a clean energy fund for cornerstone equity financing, that it announced is priced at multiples to current share price.
This complements the current £5.1 million Global Green Asset Financing loan - leaving EPP well funded.
And EPP has also started discussions with a tier 1 FTSE 100 company regarding an agreement for MESH long term gas storage capacity and gas sales off-take as well as providing project debt financing.
Energy Pathways has also submitted a final concept engineering report for MESH-H2 to DESNZ. MESH-H2 is a large-scale 640MW salt cavern hydrogen storage facility with total storage capacity of 2.8TWh, to be integrated into, and massively increase the size of, the wider MESH project.
Critically, a decision on the company's gas storage licence application to the NSTA is expected soon. This is perhaps the key risk - but once approved, a signature will be in the offing.
Guardian
Yes, we all know the story - Pilot Mountain is in line for government grant funding to the tune of anywhere up to about $15 million - but GMET’s acquisition of Tempiute changes things.
GMET can do both!
It will be time soon to do a proper deep dive into Guardian, but for now…
I've done the maths on Tempiute by comparing other brownfield renovations in Nevada. You're probably looking at circa $50 million to get a sizeable operation up and running, which is much lower than a greenfield site.
Generally you have a 30/30/20 split in debt financing, equity and offtake - so maybe $15 million in dilution or £12 million, which would mean roughly 25% dilution at the current market cap.
I’ve speculated in the past that CEO Oliver Friesen (whose technical videos are nostalgically reminiscent of online university seminars) may secure non-dilutive financing for the project given the Chinese state of affairs.
Banning tungsten exports as I predicted two years ago will do that to an asset.
And I think ACAM will front the cash.
For perspective, having bought out roughly half of POW’s shareholding, ACAM will now hold a 23.45% interest in GMET.
ACAM is big money - Bacon and Leslie are household names in this sector - for reference, the outfit:
Took shares in Jubilee Metals at 2.25p (including warrants at a 50% premium at 3.38p) to fund the acquisition of Sable back in 2019. ACAM continues to hold 6.85% of JLP.
Invested at least £18 million into 49% of the strategic mineral JV with AEX Gold (now Amaroq) in June 2022. Check the share price action since.
Was the money behind the POW uranium JV, announced in June 2024. As an aside, they selected these licenses among thousands of others for investment, for a reason.
And also cornerstoned a $50 million investment into Mayur’s Central Lime Project in October 2024.
ACAM does its due diligence (rumour has it they were on site at Andrada not so long ago - keep an eye on that) and can get Tempiute into production.
It has form financing these things, and is very well incentivised to do so. GMET remains in a strong financial position due to recent institutional placings and continued warrant execution shoring up the balance sheet.
The bottom line
Alien needs its Elizabeth Hill JV this quarter - to get the cash runway to sign off on Hancock.
Asiamet needs its updated feasibility study this half - keeping project level financing for 2025 on track.
Blencowe needs its DFS to be delivered by the end of H2 2025 - financing talks will become very serious at this point.
Bezant is almost there (other than a few legal documents) and just needs the deal signed .
Energy Pathways has lined up all the golf balls. It’s up to management to hit the green and sink the putts.
Guardian’s Angel will likely be planning a further investment, but all deals have a price.
The bottom line for all these assets is that without external capital, they’re not going to generate shareholder returns. So as long as the deal on the table doesn’t take the piss - don’t quibble.
Sign it.
- I don’t blame ya. Damn good deal!