Proactive Investors weekly mining news summary including Noricum Gold, Sirius Minerals, IMIC and Afferro Mining



Shares in Noricum Gold (LON:NMG) jumped higher this week as it repeated to investors that it expects good results from this year’s drill campaign at Rotgulden.

The Austrian-focused gold explorer recently released very good grades from a review of historical assay results from Rotgulden, with grades including 4.6 m at 14.4g/t and high silver content.

Greg Kuenzel, Noricum’s managing director told investors: "We have a fantastic project, we have supportive shareholders and operate in a very stable jurisdiction.”

He added that when Noricum started the project, gold was still only US$850-900 per ounce and it was still still very profitable then, so the recent moves in gold price would not affect it.

An electro-magnetic survey last year identified 40 new targets, which will be the focus of multiple drill campaigns. This includes underground resource drilling at Rotgülden and a surface drill programme designed to test the Altenberg target at depth.

Rotgülden is one of five wholly owned Austrian assets held by the company. It is the company’s main focus, though it has also received encouraging results from Schonberg located approximately 100km to the east.

Big news last week came as International Mining & Infrastructure Corporation (LON:IMIC) unveiled a planned acquisition of iron ore group Afferro Mining (LON:AFF).

It has agreed in principle to acquire the Cameroon-focused firm for £126mln.

Investors are being offered 80 pence in cash – a 9.9 pence premium to the Afferro closing share price the day before the bid was agreed – along with a loan note worth the equivalent of 40 pence a share.

John Meyer, at City firm SP Angel, said in a note that the structure of the offer should appeal to shareholders.

"..they get the current market cap back in cash so their downside is protected but retain an option through the convertible to see how the projects within Afferro get to development," he said.

He notes the building of the infrastructure required to take Afferro's Nkout project further will be a "long and protracted" process.

"It looks like the board of Afferro have accepted that IMIC may be better positioned to push forward on this."

Meanwhile, on Thursday, the release of Afferro Mining’s (LON:AFF) quarterly results underlined its strong financial position.

The company, which owns the 2.5bn tonne Nkout iron ore project in Cameroon, on Wednesday said it was backing an “in-principle” offer from IMIC that vales the group at US$190mln (£126mln), or 120 pence a share.

Elsewhere, the definitive feasibility study (DFS) at Aureus Mining’s (LON:AUE, TSE:AUE) New Liberty asset in Liberia outlined an "economically robust" gold project based on a flat gold price of US$1,400 an ounce.

Aureus added that the DFS has extensively de-risked the project from design, operational and environmental perspectives.

Capital and operating costs are estimated to a higher level of accuracy, the company said, while the DFS has increased the average production profile for the first six years of the life of the mine (LOM).

Based on a base case of a flat gold price of US1,400 an ounce, the New Liberty project in Liberia has a pre-tax net present value (NPV) of US$230mln, giving a pre-tax internal rate of return (IRR) of 29%.

Churchill Mining (LON:CHL) updated last week on the latest in  its arbitration proceedings against the Republic of Indonesia - saying a jurisdiction hearing had been held in Singapore.

It said the decision following the hearing, which was held on May 13 and 14, would be likely to take weeks or months and there is no fixed date.

The tribunal was dealing with the challenge from the Republic that the tribunal does not actually have jurisdiction to hear the group's claim for compensation.

The determination of the fee Amur Minerals (LON:AMC) will have to pay to convert its Kun-Manie licence to a mining permit is a major step forward, SP Angel said last week.

It came after the firm announced it will have to pay 24.6m rubles (US$818,000), a figure set by Russia’s Federal Agency on Subsoil Use (Rosnedra). The money will be payable within 30 days of the formal award of a mining licence.

“Nickel is a strategic metal in Russia and Amur have successfully discovered, explored, evaluated and held onto the assets over the last decade. The company is exceptional in its situation within the Russian system and has held onto a hugely valuable asset without serious challenge," said the broker.

In other news, Premier African Minerals (LON:PREM) is to offload its Togo subsidiary, following the decision to sell its Mali assets just last month.

Passing on its Togolese arm to TSX-listed Ethiopian Potash Corp (EPC), as it did with its Mali division, will see Premier dispose of its Southern Togo phosphate and clays project and the Bassar phosphate project.

The Dapaong Gold Project in Northern Togo and its Benin branch will not be sold and are remain in Premier’s hands.

Last week, Sirius Minerals (LON:SXX) revealed an objection to its potash project in the North York moors was to be removed.

The Ministry of Defence (MoD) intends to remove the objection regarding the impact on the RAF Fylingdales facility in the area, said the firm.

It came after the firm updated on the approvals process earlier in the week - saying objections had been received from the Environment Agency and Natural England.

The firm said it was confident that these would be dealt with through conditions placed on any approval for the project and its experts along with the two organisations would be having detailed discussions to seek a solution before the planning determination meeting on July 2.



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