Alan Green joins the UK Investor Magazine podcast to discuss the commodities super cycle – Mast Energy Developments #MAST, Advance Energy #ADV and Caerus Mineral Resources #CMRS
Alan Green discussed the commodities super cycle on the UK Investor Magazine Podcast as it began at the beginning of 2021. Since then, major commodities indices have increased dramatically with copper touching 10 year highs and Oil breaching $70.
Demand for commodities is increasing as economies reopen after the pandemic and under investment in commodity exploration and development has caught supply off guard leading to higher prices. This is particularly evident in Lumber markets which has seen $25,000 added to the cost of constructing the average US home.
With the Federal Reserve hinting QE tapering is some way off, meaning interest rate increases won’t be happening for some time, the path is clear for further commodity price rises. We explore what this means for equity markets and how commodities shares could outperform over the next decade.
We discuss Mast Energy Developments (LON:MAST), Advance Energy (LON:ADV) and Caerus Mineral Resources (LON:CMRS).
Echo Energy plc, the Latin American focused full cycle energy Company, is pleased to announce its audited results for the financial year ended 31 December 2020.
- Fourfold increase in revenue to US $11.1 million (2019: US $2.6 million)
- Favourable fiscal environment have led to the receipt of certain VAT payments, improving business cashflow.
- Santa Cruz Sur net daily production in 2020 totalled 1,966 boepd:
- 10.2 mmscf/d of natural gas
- 259 bbls/d of oil and condensate
- In 2020, Echo’s net cumulative production was 0.72 MMboe:
- 3,750 mmscf of natural gas
- 94,693 bbls oil and condensate
- Company estimated reserves and resources as at 31 December 2020 net to Echo’s 70% interest:
- 1P (Proved): 3.13 MMBoe
- 2P (Proved & Probable): 4.06 MMboe
- Contingent Resources (High estimate): 7.20 MMboe (Best estimate 6.51 MMboe)
- Adapted swiftly during the period to challenges presented by COVID-19, reorganisation along value chains enabled Echo to lower operating costs and improve efficiencies
Post period end
- Company successfully completed the restructuring of both the Company’s EUR 20.0m 8.0% secured notes and the Company’s EUR 5.0m 8.0% secured convertible debt facility loan. This represented a landmark step for the business by materially improving the financial outlook through the deferral of maturity until Q2 2025 and no cash interest payments prior to the maturity date. The agreement, with the support of the debt holders not only substantially strengthens the balance sheet it enables for the reinvestment of cashflow into the business to drive further growth.
- Secured new gas sales contracts at premium rates to the prevailing spot markets in early Q1 2021.
- Echo entered into a cooperation agreementwith GTL International S.A. (“GTLI”) to seek future opportunities in Bolivia.
Martin Hull, Echo’s Chief Executive, commented:
“Echo’s resilience during a very challenging year has ensured that we have been able to continue our operations efficiently and build firm foundations commercially and operationally despite the difficult external conditions. Not only have we made significant cost-saving efforts across the Company and rebalanced our financial position to provide increased flexibility, but we have also achieved tremendous operational progress across our SCS assets where we currently benefit from a favourable fiscal environment and attractive gas sales agreements with key customers. Moving forward, we are excited by the continuing expansion opportunities at our SCS assets, where we aim to maximise production potential, and we are also encouraged by the potential for new hydrocarbon and/or renewable energy prospects in neighbouring Bolivia and elsewhere in the Region. The framework for 2021 and beyond has now been set in place, and we look forward to capitalising on our various growth catalysts.”
For further information, please contact:
Martin Hull, Chief Executive Officer
|via Vigo Communications|
|Vigo Communications (PR Advisor)
|+44 (0) 20 7390 0230|
|Cenkos Securities (Nominated Adviser)
|+44 (0) 20 7397 8900|
|Shore Capital (Corporate Broker)
|+44 (0) 20 7408 4090|
Link to the full announcement and statements here.
Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce an update on its Kalahari Suture Zone (“KSZ”) project, receipt of £59,500 in warrant exercises and completion of the strategic partnership with Spectral Geophysics (“Spectral”) (announced 20 April 2021).
Further to the announcement on 20 April 2021, Spectral has completed a third Time Domain Electromagnetic (“TDEM”) survey in Target Area A (“Survey A3”). This survey was designed to corroborate the existence of the large-scale conductive anomaly previously identified. Spectral also deployed an upgraded configuration of its equipment, which has proved to be successful.
TDEM surveys can be used to identify super electromagnetic (“EM”) conductors at depth, within highly complex geological environments such as the KSZ. Spectral Geophysics is a highly experienced and effective operator of TDEM technology currently being employed on the project.
Data from Survey A3 has now been successfully processed and interpreted. The data further confirms the existence of the previously identified conductive anomaly and that it has a conductance of ~3000 Siemens. Kavango now estimates the anomaly’s properties are:
- 1km length, which is open along strike
- Extends between 250m to 700m below surface and is gently dipping
- Decay constant of approximately 340msec and conductance of approximately 3000 Siemens, readings which Kavango management considers are consistent with nickel sulphide deposits elsewhere in the world
- Located in the right geological setting, at the bottom of a “keel” in the gabbroic intrusion, according to the Company’s Magnetic 3D-Model (8 September 2020)
As the results come in from Kavango’s extensive TDEM surveying programme and are processed and interpreted, the Company expects to start planning a drilling programme. The exact timing and extent of such a programme remains to be determined, but it is currently considered likely that it will include drilling inclined holes of up to 450m through the conductive target at A2 that will aim to intercept the conductor at roughly 400m.
Kavango has prepared an explanatory video, which presents the geophysical model of the conductive target at A2, for shareholders to view on the Company’s website. The video is accessible via the link below:
On completion of Survey A3, Spectral immediately deployed its team and equipment to Target Area B1, which Kavango’s field exploration team had prepared in advance. This survey is now nearing completion and Kavango expects to receive data later this week, for processing, interpretation and review.
Spectral will then move straight onto Target Area B2, which the Company has begun preparing the site for.
Kavango anticipates the remaining TDEM surveys in this current phase of exploration will continue at this accelerated pace.
Completion of Spectral Geophysics Strategic Partnership
Following the success of the first TDEM surveys in the KSZ, Spectral and Kavango entered into a strategic partnership in April 2021, to leverage each other’s expertise to identify high-priority drill targets.
As part of this deal, Kavango agreed to issue Spectral with 3,000,000 ordinary shares of £0.001 at an issue price of 3p pence per share (the “Partnership Shares”). The Partnership Shares are subject to a 12-month lock-in and will be held in custody by the Company’s broker, First Equity. The Company allotted the Partnership Shares on 30 April 2021, subject only to their admission to the Standard List segment of the Official List and to trading on the main market of the London Stock Exchange plc (“Admission”).
Exercise of Warrants
Kavango announces it has received notices to exercise warrants over 5,950,000 new ordinary shares of £0.001 each in the Company (the “Warrant Shares”).
The Warrant Shares are being issued pursuant to the exercise of warrants granted and announced on 15 April 2020. Subscription monies of £ 59,500 have been received by Kavango in respect of these exercises.
Admission and Total Voting Rights
Application has been made for Admission of the Warrant Shares and Partnership Shares. It is expected that Admission will become effective and that dealings in the Warrant Shares and Partnership Shares will commence at 8.00am on or around 11 May 2021.
Following Admission, the total issued share capital of the Company will consist of 351,352,139 Ordinary Shares. Therefore, the total number of voting rights in the Company is 351,352,139 and this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest, in the share capital of the Company.
Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.
For further information please contact:
Kavango Resources plc
First Equity (Joint Broker)
+44 207 374 2212
SI Capital Limited (Joint Broker)
+44 1483 413500
Note to Editors:
THE KALAHARI SUTURE ZONE
Kavango’s 100% subsidiary in Botswana, Kavango Minerals (Pty) Ltd, is the holder of 14 prospecting licences covering 7,573.1km2 of ground, including 12 licences over a significant portion of the 450km long KSZ magnetic anomaly in the southwest of the country along which Kavango is exploring for Copper-Nickel-PGM rich sulphide ore bodies. This large area, which is entirely covered by Cretaceous and post-Cretaceous Kalahari Sediments, has not previously been explored using modern techniques.
The area covered by Kavango’s KSZ licences displays a geological setting with distinct similarities to that hosting World Class magmatic sulphide deposits such as those at Norilsk (Siberia) and Voisey’s Bay (Canada).
The Norilsk mining centre is about 2,800km northeast of Moscow and accounts for 90% of Russia’s nickel reserves, 55% of its copper and virtually all of its PGMs. Kavango’s licenses in the KSZ display a geological setting with distinct geological similarities to the magmatic sulphide deposits at Norilsk. Magma plumbing systems are a key feature of these deposits.
Super EM Conductors: are bodies of highly conductive minerals such as metal sulphides, which conduct electricity very rapidly provided the mineral grains are in contact with each other.
Gabbro/gabbroic: A coarse grained, medium to dark coloured rock, formed from the intrusion of mantle derived molten magma into the earth’s crust. Gabbroic rocks (or “gabbros”) are formed as the molten magma crystallizes and cools.
Gabbroic sills: Relatively thin, planar, (originally) horizontal bodies of solidified gabbroic magma that intruded into the Earth’s crust while still molten.
Karoo: The Karoo System covers 1.5 million km2 of the semi-desert region of Southern Africa. Rocks in this system formed 180-310 million years ago.
Massive sulphide: When a deposit consists almost entirely of sulphides it is termed “massive”. When it consists of grains or crystals of sulphide in a matrix of silicate minerals, it is termed “disseminated”.
Metal/Magmatic sulphide: Deposits of sulphide mineral concentrations in mafic and ultramafic rocks, derived from immiscible sulphide liquids. To view a video of how metal/magmatic sulphides form please visit –
- Stage Two 2,200m (74 holes) diamond drilling program underway in Uganda.
- Designed to define a +10Mt TGC Measured and Indicated Resource from existing 16.3Mt.
- Fully funded through existing cash resources.
- Previously drilled high grade zones in Northern Syncline and Camp Lode to be included in new upgraded resource.
- Additional in-fill drilling to provide basis for mine planning, delivery of geotechnical and other information, for inclusion in Pre-Feasibility Study (PFS).
Blencowe Resources Plc (“Blencowe Resources” or the “Company”) (LSE: BRES) is pleased to announce the commencement of the Stage Two drilling program at Orom-Cross, designed to in-fill the recently announced JORC Resource and upgrade substantial tonnes into the Indicated and Measured categories. This additional program will progress Orom-Cross along its development path towards first production, and will be executed using the Company’s in-country technical partners, ADT Drilling and Minrom Consulting. Additional resources will also be targeted in the current programme, with drilling also focusing on proven high grade areas, as yet not included in the maiden JORC Resource.
On 13 April 2021, Blencowe announced its maiden JORC Resource estimate for Orom-Cross, less than one year after acquiring the Project. The commencement of Stage Two, so soon after the highly successful maiden drilling programme, underlines the Company’s focus to add significant value efficiently and cost-effectively within this development phase. The drilling campaign will progress in parallel with the ongoing metallurgical test work, with leading graphite expert SGS Lakeside in Toronto/Canada, the results of which are expected later this quarter. The drilling program will take approximately 2-3 months to complete, with a similar amount of time thereafter to prepare samples, complete all assaying and provide a JORC Resource update. The Company will provide updates during the drilling campaign as appropriate.
The maiden JORC Resource delineated a 16.3Mt TGC resource at Orom-Cross, almost twice the size as the originally targeted. This next phase of development will bring the drill spacing closer together to ensure continuity of both product and grade, as required for mine planning within the PFS that will follow.
The Stage One drilling program also located higher grade graphite in the Camp Lode, which was only partially explored. Stage Two will therefore also target parts of the Camp Lode to bring it into the overall JORC Resource for the first time, which is likely to have a material positive impact on both grade and tonnes.
Cameron Pearce, Executive Chairman commented;
“I am delighted to announce the commencement of our fully funded Stage 2 drilling program, which we expect will add further material value to the Orom-Cross graphite project in Uganda. We are moving quickly towards the feasibility studies phase and this current drill program is designed not only to expand the resource’s size, grade and classification, but also ensure that all necessary geological and mining information required for those studies is subsequently available. We have already come a long way in a short period of time at Orom-Cross. We look forward to the results of this next phase of drilling and the results of the ongoing metallurgical studies with great optimism.
“We remain firm believers that the battery metals market is only just beginning its massive growth cycle over the next decade. We believe this once-in-a-generation transformation will continue to expand exponentially into the future. Benchmark Minerals Intelligence recently announced that over two hundred lithium-ion battery Megafactories are now in the pipeline worldwide, a significant growth from just seventy factories three years ago. These represent millions of tonnes of future graphite demand in the years ahead and support the positive outlook for the graphite market.
Accordingly, we are resolute in our position that Orom-Cross offers significant value and the ability to play a substantial role in helping to ease the significant forecast deficit of graphite in the future. We have already been issued a 21-year mining license at Orom-Cross, which not only considerably de-risks our work ahead, but also should help the Company advance the asset into production in an expeditious manner.
I look forward to updating the market on the results of the metallurgical test work later this quarter.”
For further information please contact:
Blencowe Resources Plc
Tel: +44 (0)1624 681 250
Tel: +44 (0)7891 677 441
Brandon Hill Capital Limited
Tel: +44 (0)20 3463 5000
First Equity Limited Tel: +44(0)20 7330 1883
Jason Robertson firstname.lastname@example.org
Orom-Cross is a potential world class graphite project both by size and end-product quality, with a high component of larger flakes identified from previous work performed. A 21-year Mining Licence was issued by the Ugandan Government in 2019 following extensive historical work on the deposit.
Orom-Cross presents as a large, shallow open pitable deposit, with an estimated resource in excess of 3 billion tonnes of graphite. Development of the resource is expected to benefit from a low strip ratio and free dig operations, thereby ensuring lower operating and capital costs.