by Will Purcell
The diamond and specialty minerals stocks box score on Thursday was a weak 58-75-167 as the TSX Venture Exchange rose two points to 578 but polished diamond prices dropped 0.15 per cent. First Cobalt Corp. (FCC) has had no news in over a month but it continues to be a busy trader. Today it closed unchanged at 13 cents on 1.51 million shares. When it is talking, it is talking about refining cobalt in Northeastern Ontario and mining it in Idaho.
Chris Grove and David Hodge's Commerce Resources Corp. (CCE), down 6.5 cents to 34 cents on 113,000 shares, has rejigged the terms of its proposed financing. A week ago, it was offering 7.27 million shares at 5.5 cents. The following day Commerce rolled back its stock 1:10, so it is now offering 727,272 shares at 55 cents. Unfortunately, as often happens, the consolidation gave Commerce's stock more room to fall and it had been doing just that until Wednesday, when it inexplicably shot up 11.5 cents on 891,000 shares. Despite today's retreat, there is no plan yet to pare back the price of the placement, which is to supply $400,000 for the company's Ashram rare earth project in Northern Quebec.
Ashram was big news several years ago, during the brief but intense rare earth price surge of 2011, triggered by worries of diminished Chinese supply. Commerce delineated 30 million tonnes measured and indicated and 220 million tonnes inferred at 1.88 per cent total rare earth oxides at the time, and it managed to roll out a preliminary economic assessment just as the bloom was coming off the rare-earth rose.
The Ashram dream sheet showed a discounted net present value of $2.32-billion before taxes, based on a $760-million mine plan, but the valuation went quickly out of whack as China suddenly had excess supply and prices slumped. Now, with Donald Trump and the Chinese wielding tariffs like broadswords, Howe Street is again gushing about rare earth plays.
Mark Jarvis's Giga Metals Corp. (GIGA) closed unchanged at 25 cents on 420,000 shares. Mr. Jarvis, Giga's president and chief executive officer, says that his company has hired Miami Beach-based Phenom Ventures LLC at $4,500 (U.S.) per month to run a "corporate awareness" program. (He means a promotional program, but promoters hate the term promotion, even when they are hiring promoters to do the work for them.) Mr. Jarvis says that "the time is right to expand awareness" of his company and its Turnagain nickel and cobalt project in north-western British Columbia, noting that nickel prices have been rising steadily over the past few months.
Mr. Jarvis is right: Nickel prices, about $5.30 (U.S.) in June, recently topped $7.30 (U.S.) per pound, but his silence about cobalt is equally informative. Cobalt topped $34 (U.S.) per pound in early 2018 but it recently dipped as low as $11 (U.S.) per pound, so Mr. Jarvis has scaled back the cobalt rhetoric of late. Indeed, at one point he lauded Turnagain as being one of the few projects in a stable jurisdiction that "can potentially deliver large quantities of cobalt and nickel" to meet the growing needs of the electric vehicle and energy storage markets. Now, it is nickel and cobalt, or just nickel.
Eight years ago, Turnagain was credited with 865 million tonnes measured and indicated at 0.21 per cent nickel and 0.013 per cent cobalt, with nearly one billion tonnes inferred at comparable grades. Giga, then known as Hard Creek Nickel Corp., completed a preliminary economic assessment in 2011 for the project, proposing a mine that would achieve an 86,000-tonne-per-day throughput in its fifth year.
The low grades kept the discounted net present value at a modest $725-million (U.S.) after taxes, even with a nickel price of $8.50 (U.S.) per pound and cobalt at $14 (U.S.) per pound -- prices that are handily above current ranges. In any case, Mr. Jarvis and Turnagain will need to generate plenty of corporate awareness -- the good kind, that is -- to make a Turnagain mine a reality: The now dated dream sheet pegged the initial capital cost at $1.32-billion (U.S.), with another $555-million (U.S.) needed for the fifth-year expansion.
Dr. John Burba's International Battery Metals Ltd. (IBAT), up one cent to 14 cents on 85,000 shares, is offering 13 million shares at 10.5 U.S. cents, seeking $1.37-million (U.S.) for "completion and implementation of the company's first mobile lithium extraction unit." This unit, when built -- and it is reportedly nearly complete -- will be sent to South America, most likely Argentina, where it will be used to recover lithium from a salar deposit found by its partners, Ensorcia Metals Corp. and Sorcia Minerals LLC.
Dr. Burba, president and CEO since last year, cheers the mobile plan, noting that the equipment can be rapidly deployed with low capital and operating costs, and that its environmentally-friendly modular design offers scalability. Investors appear receptive to the story, as International Battery's stock has been steady for the past year, but on Howe Street, the devil is in the omissions: What Dr. Burba does not say is how much lithium the system can produce.
Toby Mayo's Far Resources Ltd. (FAT), down one-half cent to 4.5 cents on 117,000 shares, is taking to the promotional hustings on its own. Mr. Mayo, president and CEO, says that the company has updated its website and "marketing materials" -- he means the spiffy new promotional spreadsheet that will accompany him and his crew on the road to dog and pony shows touting green power in Michigan, Utah and Kentucky next month.
It is unclear what Far's new promotional campaign means for development of its Zoro lithium project in Northern Manitoba and its Hidden Lake lithium play near Yellowknife. Investors will have to remain attentive during the company's spiel, as the first real mention of Zoro does not come until slide 24 of the company's 35-slide presentation. The company has a modest resource at Zoro, 1.1 million tonnes at 0.91 per cent lithium oxide in Dike 1, but much more drilling across it and several other dikes are needed to expand the resource to a promotable extent. (The less advanced Hidden Lake play also produced good assays, but its first mention comes late, on slide 32, when many investors will be wandering -- or nodding -- off.)
Warren Stanyer's ALX Uranium Corp. (ALX: $0.045) has bought a three-year extension to the deadline for $1.5-million of work on a portion of the Newnham Lake uranium project in Northern Saskatchewan. The company was to have completed the work next week, but the vendor of the 1,520-hectare portion of the property agreed to the delay in exchange for 300,000 shares, currently worth just $13,500. It is not clear how much ALX has spent on that portion of the Newnham project so far.