The Kangari African Review #2

 

A LOT CAN HAPPEN IN TWO AFRICAN WEEKS

Wow, 2 weeks already!!! One of the biggest developments is that South Africa and Lesotho have eased measures on mining companies and mines are slowly opening again, despite the countries still being in lockdown. Gem Diamonds (LON:GEMD), will reopen its Letseng Mine in Lesotho on Monday, a country which has seen no recorded COVID-19 cases. Gem Diamonds continue to work the governments health and distancing requirements.

Sibanye-Stillwater (JSE:SSW) whilst reducing their production outlook for 2020 also look to be resuming operations in South Africa this coming week. Sibanye-Stillwater currently account for 70% of the world’s platinum output so this could cause a dip in platinum prices which have done well this year to date. Sibanye noted that their US and Zimbabwean operations have so far not been affected by COVID-19 and continue to operate.

In an interesting COVID-19 development, British gem miner Gemfields (LSE:GEM) have ramped up the security at their Mozambique ruby mine due to an outbreak of COVID-19 at a local prison forced the government to release prisoners into the general population.

Moving from Southern Africa, Gemstones and COVID-19, Glencore (LSE:GLEN) have announced that they are to take their 99.46% owned, Toronto listed, Congo based Katanga Mining (TSE:KAT) private at a premium price of 16c per share. This was initially at a 100% premium to the closing price on Tuesday – the share price at close on Friday was of course 16c.

Katanga accounts for 10% of the current world production of cobalt from its Komoto mine complex in the DRC. The mine has been plagued with government issues and now COVID-19 reducing the ability to travel and the cobalt supply chain. As such Katanga has reduced its cobalt production target from 29,000 tonnes to 26,000 – I would expect that to fall further in the next 12 months.

If you’d like to read more about the cobalt supply chain and the current situation you can read last Monday’s Spotlight Mining feature here: https://spotlightmining.com/blog/1404/

AFRICAN EXPLORATION NEWS

The focus is on West Africa where Roxgold Inc. (TSE:ROXG) reported a positive PEA last week on their 7.1 MT @ 2.3g/t gold deposit at Seguela in the Ivory Coast. The PEA results include a post-tax NPV (5%) of A$268M and IRR of 66%.

Another PEA result this week comes from Global Atomic Corp. (TSE:GLO) a there Dasa Uranium project in Niger. PEA results include post-tax NPV (8%) of US$211M and an IRR of 26.6%. Uranium price has been steady with a slight uptrend in early 2020, one to watch maybe?

Back in the Ivory Coast, Predictive Discovery Ltd. (ASX:PDI) reported drilling results from their Ferkessedougou project, including, 14m @ 10.74g/t gold from 33m. Just across the border at their flagship Syama Mine, Resolute Mining (ASX:RSG/LSE:RSG) report 7m @ 22.83g/t gold from 18 meters. Just across the border again, this time in Guinea, we are back with Predictive Discovery who also drilled 46m @ 6.58g/t gold at their Kaninko Project. An excellent flow of results from 2 projects in 2 countries has shifted the Predictive Discovery share price from 1 aussie cent to 6 and half, a great week for their shareholders.

It's been busy! We're expecting some big news this week so keep your ears to the ground. cheers!

Tim Strong
Kangari