Marvel Gold Ltd (ASX:MVL) recently signed an agreement with Oklo Resources Limited (ASX:OKU) to acquire an 80% interest in Oklo’s three South Mali gold projects covering 675 square kilometres of highly prospective Birimian Greenstone terrain.
The company, which recently changed its name from Graphex Mining to reflect its new gold focus, believes that the location and size of the three new projects will provide further opportunity for gold discoveries.
These projects will enhance Marvel’s existing primary exploration project Tabakorole along with the other project at Lakanfla.
London-based financial boutique Tamesis Partners believes the geological optionality in Marvel’s portfolio is highly attractive and that the market has not yet had the chance to fully respond to this fresh equity story.
The following is an extract from Tamesis Partners’ prospect note on Marvel:
A NEW DIRECTION WITH A NEW MODEL
Marvel Gold (ASX:MVL), previously known as Graphex, has been reborn a Mali focused gold explorer. The company has ring fenced its Chilalo graphite project and has already built an exciting portfolio of gold exploration assets. Capital Limited (LSE:CAPD) played an instrumental role enabling this metamorphosis and retains a significant stake in the business. The company has an exciting combination of local knowledge, geological IP and corporate experience, exemplified by the recent appointment of Andrew Pardey (formerly CEO Centamin LSE: CEY) to the board.
GRAPHITE VALUE TO BE CRYSTALLISED
Chilalo is now ringfenced and MVL is seeking a buyer of the asset with proceeds in excess of the liabilities (c. US$6.8m) to be retained by MVL. While some may view this as a defeat, it has inadvertently formed the foundation for a west-African gold explorer with strong credentials. Marvel Gold’s management deserve credit in wasting no time steering the company in a new strategic direction.
A NEW MARVEL
Marvel Gold has joint ventured with Altus Strategies (LON:ALS) into two exciting exploration plays in Mali: Tabakorole and Lakanfla. MVL is fully funded for its next stage of exploration and can earn up to an 80% interest in both projects by completing four key stages ending in a Definitive Feasibility Study. The company also recently acquired an 80% interest in Oklo Resources Limited’s (ASX: OKU) three South Mali gold projects in a cash and share deal. From this acquisition, MVL has increased its land holdings in Mali to approximately 800km2.
Complementing the company’s new strategic direction the management team has also refreshed the board. As mentioned above, the appointment of Andrew Pardey, as Non-Executive Director, is a significant addition due to the regional expertise he brings. Moreover, the appointment of Chris van Wijk, a geologist with extensive African exploration experience, as Exploration Director adds to the company’s strong exploration credentials.
Feedback from operators in country gives us confidence regarding the impact of the recent changes in the political situation in Mali. For example, Barrick Gold, Resolute and Hummingbird have all reported that it is business as usual which, to us, suggests there has been little or no restriction in the flow of personnel and consumables into the country. Junior explorers such as MVL, who already have equipment and personnel in place, are unlikely to have their exploration programmes hindered. As is often the case, the situation on the ground seems to be a lot less dramatic than what appears on the news.
We expect lots of news flow in the near term with recent drilling at Tabakorole feeding into a maiden resource due in Q3’20 and drilling commencing at Lakanfla. The market has recently revalued the exploration sector higher. We believe the geological optionality in Marvel’s portfolio is highly attractive and that the market has not yet had the chance to fully respond to this fresh equity story. The key with exploration companies is the consistent generation of news flow to hold the markets attention. Reassuringly, with a portfolio of exploration assets and existing resources building, you can expect a nice stream of updates from Marvel Gold. Furthermore, we rate the combined expertise of the team highly. The nuances of operating multiple exploration programs in west Africa are not easy from a logistical perspective but this team are already proving their competency.