Late last year, Investor Insight flagged a handful of stand-out stocks that were charging full-steam ahead through the festive break. Fast-forward a month and they are reaping the early rewards as 2022 shapes up to be another outstanding opportunity for gold and the metals needed for the electric vehicle boom.
This week, the gold price jumped to a two-month high of US$1842 per ounce and the All Ordinaries gold index rose 6% as omicron fears drove investors back to this centuries-old safe-haven asset.
Nickel, long talked about, has begun the New Year on a tear with low inventories driving the price of this sought-after battery metal to a decade-high of $23,565 per tonne. It was great news for St George Mining (ASX: SGQ), which is busy drilling at Mt Alexander.
And with EV batteries in focus, the investor rush has rubbed off on the ingredients of the permanent magnets needed – namely rare earths like neodymium and praseodymium (together, NdPr). The timing could not be better for Hastings Technology Metals (ASX: HAS) as it finalises funding and secures last remaining approvals for its world-scale Yangibana project.
But it was gold that delivered the most precious news, led by Rox Resources (ASX: RXL) which confirmed its status at the head of the queue of WA’s next generation of gold producers with a major resource upgrade at its Younanmi project to almost three million ounces.
Taking a look back:
- Adding some resilience to your permanent magnets
- Nickel ain’t worth just a dime … but much much more
- Hydrogen, simply elementary
- Adding dysprosium to your magnet
- Silica’s value clear for all to see
- It’s been a truckin’ journey – Hyzon Motors’ $2.8b NASDAQ debut
- Between a hard rock and recharging your battery
- The highlights of Diggers & Dealers 2021
Rox’s news this week of an 81% upgrade to the total mineral resource at Youanmi, near Mt Magnet, driven by a major increase in inventory at the Youanmi Deeps deposit, generated great cheer among investors to drive the company’s share price up 42% to 49c by week’s end.
The Deeps resource now stands at 9.9 million tonnes at 6.89g/t for 2.19 million ounces, making up the bulk of Youanmi’s total mineral resource of 24.6 million tonnes at 3.78g/t for 2.99 million ounces.
Rox managing director Alex Passmore said the resource upgrade was a credit to a geology team that had delivered new gold-bearing structures and demonstrable returns, especially at the Link prospect.
“We are delighted to announce this substantial upgrade to the Youanmi gold project mineral resource estimate following the successful execution of our targeted infill, extensional and discovery drilling strategy,” he said.
“Rox continues to trade at very low enterprise value per attributable resource ounce metrics, calculated currently at $22 per ounce.
“Youanmi mine feasibility studies continue with early mine planning results feeding back into targeted infill drilling areas for continued conversion of inferred material into indicated categories. We also continue to work on grass-roots exploration activities in areas outside the immediate Youanmi mine area with the intent of making new discoveries in the region.”
Canaccord Genuity analysts rate Youanmi as one of the highest-grade projects in WA’s development space and the fifth-largest project on the go. Canaccord has a speculative buy tip on Rox with a share price target of $1.10.
“[Rox] presents excellent value at these levels on an EV/resource ounce metric, despite being up +30% to 49c following release of this resource update,” Canaccord said.
Focus Minerals (ASX: FML), fresh from raising $25.5 million to advance its near-development Coolgardie gold project, also continues to add more ounces at its second target, the Laverton gold project.
The Shandong Gold-controlled company this week announced a maiden mineral resource of 33,900oz at a grade of 1.34g/t for its Lancefield Far North deposit. The mineralisation at Lancefield Far North is open along strike and a lookalike of the nearby Wedge/Telegraph-style mineralisation, which has multi-kilometre strike.
Focus has had a remarkable success adding ounces, at a very low cost, to Laverton as it builds an inventory that can underpin an open-pit operation.
Rounding out this week’s trio of gold stocks, BMG Resources (ASX: BMG) is steaming ahead with drilling at its Abercromby project near Wiluna, where diamond and aircore drilling is underway.
“Whilst we, like many of our peers, will have to patiently await the full results of these two programs, we are very pleased to have hit the ground running in 2022 and put our best foot forward for both prospective results and turnaround times for the results of these activities,” managing director Bruce McCracken said.
“This year is shaping up to be another prospective one for precious metals explorers and BMG is pleased to be in the right jurisdiction and at the right time to capitalise on our core assets.”
While there are enough reasons to be bullish on gold – omicron, Ukraine, US inflation and so on – the EV thematic is equally exciting, particularly for investors backing nickel and rare earths stocks.
St George, which is exploring Australia’s most exciting, advanced high-grade nickel sulphide project at Mt Alexander near Leonora, continues to reap the benefits of a groundbreaking seismic survey carried out late last year.
The John Prineas-led explorer said this week analysis of the seismic survey had delivered three additional highly exciting targets that would be prepared for drill testing.
The latest targets – S3, S4 and S5 – were selected as prospective for massive nickel-copper sulphides based on their increased seismic amplitude and coincidence with an intrusive structure.
In the meantime, a diamond rig is busy drilling S1 before moving onto S2, guaranteeing newsflow in coming weeks.
“The high-grade discoveries already made in the Cathedrals Belt (at Mt Alexander) are proof that we have a fertile and high-grade mineral system,” Mr Prineas said.
“The sheer scale of the structural network now being revealed by the seismic data strongly supports the potential for further significant mineralisation in the project area”.
Lynas, as the only rare earths producer listed on the ASX and therefore the sector’s bellwether, told investors this week that “sustained demand for NdPr saw the market price reach US$100/kg in November 2021, the first time since 2011 that it has reached this level. The average China Domestic Price for NdPr during the quarter was US$105.9/kg. Customers indicated a priority focus on security of supply rather than price.”
Happy days and perfect timing for Hastings, which said this week it had received approval from the Department of Water and Environmental Regulation of its flora and vegetation environmental management plan and sign-off from the Department of Mines, Industry Regulation and Safety for a revised mining proposal – two key approvals needed to progress early site works at Yangibana, in the Gascoyne region of WA.
Yangibana hosts world-class levels of NdP – with ratios of up to 52% of total rare earths oxides – and Hastings is pushing hard to finalise the debt and equity required to become a globally significant rare earths producer. Work is progressing on early stage works at Yangibana and this year is shaping as a transformational one for Hastings.
Hastings shares hit 31.5c this week, levels not seen since late 2017.
