Weekly Brief 15th January

As the second week of the new year comes to a close, how many of us are keeping up with our new year resolutions?

We have the ancient Babylonians to thank for the yearly tradition as the first to be recorded to hold new year celebrations around 4,000 years ago in the festival Akitu, where promises were made to the gods for the upcoming year. However, their new year began in mid-March – so still plenty of time to make a start for any procrastinators! With those optimistically made resolutions hanging over our heads and mantras of ‘new year, new me’ starting to look lacklustre, the excitement of a shiny new year has lost some of its appeal after the Year That Shall Not Be Named. This week is the perfect time to sleep through that early morning run, track down those hidden reserves of chocolate in your house, and pour a well-earned glass of wine without any guilt for Ditch New Year’s Resolution Day. Although a highly unofficial holiday, it definitely has (some) scientific backing: one in three ditch their resolutions in the first month and only a quarter of the UK population managed to see theirs through to the end of last year. However, if you are determined to keep them up, psychologists suggest shifting the resolution from focusing on a ‘problem’ to creating a goal from a place of strength that already exists for best longevity, and will lead to an improved daily quality of life and self-appreciation. Setting objectives for the year and enacting some positive changes in your life is definitely admirable but with lockdown 3.0 kicking off the year, the last thing we need is self-inflicted stress and pressure – making it through the day, the week, or just the next zoom meeting/quiz night/gym session/anything and everything, is commendable enough of a feat in itself.

Client News: 

Hat-trick of news releases from Dekel Agri-Vision Plc (AIM: DKL) this week.  First up was a quarterly and full year production update for the Ayenouan palm oil project. Double-digit year on year growth in production and sales in Q4 helped offset lower year on year volumes in H1 due to a weaker peak harvest season.  Global prices posted a strong recovery in Q4 2020, increasing 23% to €602/tonne, which bodes well for the upcoming 2021 high season.  The higher pricing performance is expected to more than make up for lower full year palm oil production of 34,002 tonnes (FY 2019: 37,649 tonnes) and as a result Dekel is confident that 2020’s financial numbers will show a material improvement on 2019.  Next day, Dekel announced an issue of equity to one of its directors who has elected to be paid in shares in the Company rather than cash – a big vote of confidence in Dekel and its prospects.  Finally, Dekel has engaged Proforest to undertake the final pre-audit of Ayenouan ahead of the commencement of the Round Table for Sustainable Palm Oil (‘RSPO’) certification process later this year.  Subject to receipt of RSPO certification, Dekel will not only be Cote d’Ivoire’s fourth largest CPO producer but also one that is certified to operate in line with globally recognised best practices, which potentially allows its palm oil to be sold at a premium.

Europa Oil and Gas Plc (AIM: EOG) provided an update on the development of the Wressle Oil Field in North Lincolnshire, in which Europa holds a 30% working interest. The workover rig and associated services and equipment were successfully mobilised to the site during the week commencing 4 January 2021. Operations to recomplete and reperforate the well have also begun and on completion are expected to enable the Ashover Grit reservoir to be flowed before the end of January 2021. Production is expected to commence at a gross rate of 500 bopd, which would more than double Europa’s existing UK onshore production to over 200bopd.  With an estimated breakeven oil price of US$17.6/barrel and with oil prices currently trading above US$50/barrel, production at Wressle is expected to be highly profitable.

BlueRock Diamonds Plc (AIM: BRD) announced a production update for Q4 2020 and FY 2020. In light of the issues posed by the pandemic, the outturn for Q4 2020 was very encouraging and the management team delivered in the areas that it could control.  Processed tonnes increased by 25% at the Company’s Kareevlei Diamond Mine while carat production increased by 10%. Carat sales were up but the value per carat fell because of Covid-19 as well as a reduced number of higher value diamonds found, in part due to the development of the Main Pit out of KV1 and KV2 as BlueRock prepared for the expansion of operations in 2021. However, there are now signs of recovery in the general pricing and increasing incidence of high value stones. The expansion project continues to advance, with the expectation that the plant will be fully commissioned by the end of Q1/early Q2.  The guidance for this year remains at 850,000 to 1,000,000 tonnes and 34,000 to 46,000 carats. Furthermore, a Resource Statement for a provisional upgrade to Kareevlei’s Resource is on track to be released by the end of the month.

Harvest Minerals Limited (LSE: HMI) announced positive agronomic test results for carrot crops using its direct application natural remineraliser produced at its Arapua Fertiliser Project, KP Fertil. The product returned a superior yield performance in crop experiments in carrots compared to a widely used standard application and was shown to contribute to a significant increase in soil nutrients. Over 78% of the cultivated carrots using the product achieved a length size within the preferred market range (18-24cm). The performance of KP Fertil was outstanding in various aspects including soil nutrition, productivity, and economic gains to the farmer, with the inclusion of KP Fertil in a fertiliser mix delivering a potential direct savings of 7.2% in fertilisation costs. These promising results join Harvest’s existing portfolio of positive agronomical results reported in sugarcane, coffee, and other results, reinforcing the versatility and wide application of the product.

Jubilee Metals Group Plc (AIM: JLP) announced its unaudited operational results for the six month period ended 31 December 2020. Several key milestones were achieved during the period, including the transformation of the Company’s chrome operations to secure a more sustainable earnings margin while significantly growing the business. PGM and Chrome earnings delivered a record 123% increase from H1 2020, and attributable PGM and Chrome revenue increased by 64%. Jubilee also achieved early earnings from its copper and cobalt production at the Sable Refinery in Zambia of £1.8m. Significantly, the implementation of the Company’s copper strategy to achieve 25,000 tonnes of copper units within four years gained momentum with access secured to nearly 300 million tonnes of copper and cobalt tailings. The first phase of three targeted copper concentrators should come online during Q1. The expected significant ramp-up of the Company’s copper production in Zambia has the potential to continue to grow Jubilee’s earnings, particularly with the recent rebound and market expectations of copper prices. Jubilee is now perfectly poised to play a commanding role in the processing of copper and intends to further implement its strategy more widely. Jubilee has also secured new investment from two blue-chip institutional investors, one of which is new to the share register, who have collectively bought c.5% of the company between them. This was in largely satisfied by the partial conversion of a loan note which reduces the group’s borrowings consistent with the restructuring of all historical debt held by the Company into far less costly debt provided by alternative financial institutional facilities.

Oracle Power Plc (AIM: ORCP) provided an update on Q4 2020. Oracle progressed its broader strategy to become an international natural resource and power project developer following the acquisition of two gold assets in Western Australia. A field based exploration programme at the Northern Zone Gold project commenced to support an upcoming maiden drilling programme, and work at the second asset Jundee East is expected to begin this year. Additionally this week, the processing and interpretation of geophysical datasets across the Northern Zone Gold Project in Western Australia has been completed this week. Oracle continues to be committed to developing Thar Block VI in Pakistan. Importantly, its consortium partner, China Coal, has commenced preliminary feasibility work relating to the potential gasification of coal at Thar this week. The work with China Coal is expected to establish the viability of, and a development model for, coal gasification at the project. Oracle is preparing coal-to-gas and coal-to-liquids policy requirements in conjunction with China Coal to be proposed to the Government of Pakistan following its endorsement of the country’s requirement for coal to gas conversion.  Finally, CEO Naheed Memon will be holding a shareholder Q&A session which will be made available on Oracle’s website by COB on 19 January 2021.

Kodal Minerals Plc (AIM: KOD) provided an update on its gold exploration projects in Mali and Cote d’Ivoire, as well as an update on its Fatou Gold Project and Funding Agreement. Extensive artisanal workings have taken place at the Dabakala project in Cote d’Ivoire and have developed along strike of the previously defined surface geochemical anomaly, a positive indication of the area and further enhancing the target zone. The review of the Fatou Gold Project in Mali continues to progress with further field reconnaissance to highlight the opportunities to extend the gold prospect and priority exploration targets. The drilling programme is being finalised with an initial diamond drilling and RC drilling planned for two prospects whilst a review of historic drilling is ongoing to highlight high grade mineralisation zones. The drilling will initially focus on confirming previous findings as well as targeting extensions and determine its size potential. Drilling will commence following the finalisation of the $2,500,000 Funding Agreement, which is advancing well with the documentation in progress and due diligence nearing completion after agreeing to extend the period by two weeks.

Jangada Mines Plc (AIM: JAN) noted an announcement by TSX-V listed ValOre Metals Corp., in which Jangada holds a 17.68 per cent interest. ValOre reported encouraging STEINERT ore sorting testwork results for its 100% owned Pedra Branca PGE project in northeastern Brazil. The results, which used a set of 100 re-assayed and catalogued 5-cm samples of historical NQ drill core from the Esbarro PGE deposit, demonstrated distinct density responses for mineralised rock types, as well as barren granites and gneisses. ValOre geologists are now preparing a bulk sample to support a comprehensive, quantitative follow-up sorting test programme.


You may have missed… 

Listen to the ‘Dig Deep’ episode of Mining International Ltd’s mining podcast where Rob Tyson chats with Tirupati Graphite’s Chairman and MD Shishir Poddar on its IPO and the graphite market.

Watch BlueRock Diamond Plc’s finance director David Facey talk to Proactive London about boosting production at the Kareevlei mine during 2020.

Check out Vast Resources Plc’s CCO Andrew Hall talk to Proactive London about the asset backed debt facility.

Interesting article in the Mining Journal this week following an interview with Emmerson Plc Executive Director, Hayden Locke, discussing the rising demand for agricultural commodities and its Khemisset Potash Project in Northern Morocco


In the news this week… 

The Arctic’s first crypto farm for producing Bitcoins has been installed.

Nickel prices are currently heading for a 10 year high.

A year after Mollie Hughes’ record breaking solo expedition in Antarctica, she shares her tips on handling isolation.

Major Biden, the soon to be first dog, will be having his ‘indoguration’ this weekend as the White House’s first shelter dog.

YouGov show new year’s resolutions in statistics.

We will have to keep up our 2021 resolutions for less time this year as the Earth is moving faster than it ever has in the last 50 years, potentially resulting in a ‘negative leap second’.

Read a review of 76 Days – a documentary to be released 22 January giving an inside look of Wuhan following the outbreak of the pandemic.


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