Weekly Brief 16th October

The least anticipated sequel of the year was announced this week as multiple areas in the UK, including London, are entering into a second (semi) lockdown after Saturday.

A new three-tiered ‘traffic light’ system has been put in place country-wide with many areas being placed into tier 2 and some critical areas into tier 3. Us Londoners, along with our other fellow tier 2-ers, are still able to see people outside of our household outdoors, following the rule of six. It’s the perfect time to meet up outside and enjoy a brisk walk together as London has been named in the top five most walkable cities in the world, so we are definitely spoilt for choice here. Some time in nature will not only improve our physical health but has been shown to benefit mental health as well, with doctors in Scotland beginning to prescribe 90 minutes in nature to their patients as part of a program to fight anxiety and depression in a UK first. And what better season to do so than autumn with its vivid display of jewel-toned leaves, the crisp air and the even crisper fallen leaves underfoot – especially now that spells of sunshine have replaced the rains of storm Alex, which brought us the wettest day on record. As we wrap up another week of adjusting to the changes and continue working from home, it is time to relax for the weekend and enjoy a well deserved glass of wine ‘al-desko’.


Client News:

Jubilee Metals Group Plc (AIM: JLP) provided an operational update for the first three months of Q3 2020 after returning to full operational status following the interruptions experienced due to Covid-19. A record production and financial performance has been achieved during the period after the implementation of the previously announced new third party supply agreements and it has seen improved efficiencies across all operations. This successful performance is in reflection of JLP’s drive to expand operations by supplementing its own surface resources to secure a sustainable business strategy. The Zambian copper operations continue to progress with the Sable Refinery nearing completion, and focus is on delivering JLP’s copper expansion drive following on from the two recent copper acquisitions in Zambia.

FastForward Innovations Ltd (AIM: FFWD) raised approximately £2 million following a placing with a number of new investors. The proceeds will be used to fund a number of opportunities in line with the company’s strategy to provide investors with exposure to disruptive growth opportunities, in particular medical cannabis, that have near-term re-rating potential and would otherwise be inaccessible.  Additionally, EMMAC Life Sciences, in which FastForward has a 2.3% interest, has announced the UK manufacture of its range of premium medical cannabis products. Due to the completion of EMMAC’s ‘seed to sale’ vertically integrated business model that comprises cultivation, extraction, production and distribution, medical cannabis is now more affordable for patients in the UK, marking a ground-breaking moment for the UK medical cannabis industry.

BlueRock Diamonds Plc (AIM: BRD) announced its Q3 2020 production update, achieving a record quarter for three of its main KPIs: tonnes sorted up 34%, carats produced up 40%, and a record grade of 4.51 cpht was achieved. This follows a period of low grades whilst efforts have been concentrated on creating the Main Pit whilst volumes have continued to be strong at the old pit. The average price per carat is an estimated 10% down on the comparative period in 2019 which is reflected on the sale of four high value stones last year and only one higher value stone was sold this year at USD104,000. The expansion project is well under way and the new plant is expected to be commissioned by the end of the year on schedule.

Keras Resources Plc (AIM: KRS) updated the market on its progress at Diamond Creek, a high-grade direct shipping ore, organic phosphate mine in the USA, and at the Nayega Manganese mine in Togo. Diamond Creek has completed its 2020 mining campaign and has extracted 7,620 ROM tons, 50% more than initially planned for the first year of production. Additionally, a total of 1,012 tons at an average price of $260/t have been sold, achieving 20% of the Year 1 forecasted sales in two months. The positive meetings with high level officials and service providers as part of the successful management trip to Togo in September have ensured Nayega’s progression to concluding the project permitting process and bring it to production-ready status. The site visit further underpinned this through the successful dry-testing of the processing plant and ancillary services. The trip proved extremely valuable from both operational and corporate perspectives and another is planned for November 2020.

Europa Oil & Gas’ (AIM: EOG) FY results provided an opportunity to show how much progress the Company made during the period despite the ongoing pandemic and associated lockdowns: work commenced to bring the onshore UK Wressle oil field into production by the end of the year at an estimated gross rate of 500bopd – Wressle will more than double Europa’s existing production, which averaged 92boepd during the year, to over 200bopd.  Offshore Ireland, Europa refocused its portfolio onto the proven gas play in the Slyne Basin following the acquisition of a 100% interest in FEL3/19 which brought with it the 1.2 tcf Edge gas prospect.  This lies close to Europa’s existing 1.5tcf Inishkea gas prospect.  The two provide Europa with a strategic position in a proven basin, which the Company will look to farmout to secure a partner for the licences.  Offshore Morocco, up to 30 prospects and leads with the potential to hold close to 10 billion barrels of unrisked oil resources have been mapped on the 11,228 square km Inezgane licence.  The forward plan here is to further de-risk the targets ahead of launching a farm-out to secure partner(s) to drill wells.

Armadale Capital Plc (AIM: ACP) provided an update on its 100% owned Mahenge Graphite Project in Tanzania as it moves another step closer to production. The company is in the advanced stages of appointing its chosen engineering, procurement and construction company (EPCM), who will then commence the Front End Engineering Design (FEED) of the processing plant.   In support of this, Armadale is ready to initiate a follow-up and final metallurgical test programme to enable the detailed selection of the processing plant equipment.  Positive progress has also been made on the company’s mining licence application: the National Environmental Management Council completed a site visit, which is one of the penultimate steps required for granting of the Environmental Permit to facilitate the granting of the mining licence. Alongside this, Armadale continues to engage positively in development funding options, for which it has received strong interest, testament to Mahenge’s highly compelling project economics.

Prospex Energy Plc (AIM: PXEN)  agreed to sell its 50% interest in the Suceava Concession in Romania to H2Oil Limited for up to £215,000. The sale follows a strategic review of Prospex’s portfolio which was triggered by the recent acquisition of the El Romeral gas and power project, onshore Spain, where management is looking to increase power generation at the project’s 8.1 MW plant towards its 100% capacity by drilling low cost, low risk gas wells.  Together with Prospex’s interest in the Podere Gallina Exploration Permit, onshore Italy, where first production at the Selva gas field at an initial rate of up to 150,000 scm/day remains on course for H1 2021 and the Tesorillo Gas Project, onshore Spain, where up to 830 Bcf of gas (Best Estimate) of gross un-risked prospective resources have been identified, the Company concluded that Suceava would become less core as time progressed.


You may have missed…

CEO of Jubilee Metals Plc (AIM: JLP) Leon Coetzer spoke to Proactive London about its record production and financial performance in Q3 2020, as well as joining DirectorsTalk for a video interview.

Tirupati Graphite’s Shishir Kumar Podder spoke with Proactive London on its potential intention to IPO in London in early November, giving a key an insight into the company’s fully-integrated, cash generative graphite and graphene operations. Proactive’s Alastair Ford also discussed the company’s prospects in a separate interview, noting Tirupati’s  “very high quality projects”.

In the news this week…

October 3 was the wettest day for UK-wide rainfall since records began in 1891.

A bar-tailed godwits has set the world record for longest non-stop bird flight, flying 12,000km from Alaska to New Zealand in 11 days.

The world’s most walkable cities report conducted by the Institute for Transportation and Development Policy include London in two of its measures.

Doctors in Shetland, Scotland are authorised to prescribe nature to their patients, whilst in Montreal, Canada doctors are beginning to prescribe free art museum visits.

JD Wetherspoon has reported its first loss since 1984.

Online retailer Asos has added 3 million customers and has reported a 19% rise in sales from last year.

An explanation of the government’s new three-tier system can be found here.


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