Lucapa Increases Lulo Diamond Resource Carats by 90 percent

Africa-focused diamond miner Lucapa has updated the diamond resource carats for its Lulo mine by 90 percent to 80,400 carats.

Africa-focused diamond miner Lucapa (ASX:LOM) has almost doubled the diamond resource carats at its Lulo mine in Angola.

The Australia-listed company had the mine independently assessed by Zstar Resource Consultants, a South African consultancy firm.

Zstar has pegged the alluvial diamond resource of Lulo at 80,400 carats in situ, a 90 percent increase from the previous total.

According to Lucapa, the revised resource total does not take into account the 30,000 carats the company has unearthed in the 19 months preceding December 2018. The 30,000 carats of gems were later sold at auction for US$62 million.

To date, diamonds from Lulo have fetched US$141 million, with an average price per carat of US$2,100.

“Together with the significant positive diamond marketing reforms introduced in Angola enabling producers like Lulo to achieve international market prices for their diamonds, the near doubling of in-situ resource carats in the upgraded Lulo diamond resource supports the Lulo partners’ plans to increase alluvial production in 2019,” company CEO Stephen Wetherall said in the announcement.

In 2018, the Angolan mine’s fourth year of production, 19,196 carats of diamonds were recovered.

The consultancy company also upped the Lulo alluvial per-carat value by 17 percent to US$1,425.

Zstar’s increased resource value is the result of an auger-drilling program in the floodplains along the Cacuilo river valley within the Lulo concession.

Auger drilling in the floodplain has continued throughout Q1 2019 and will be ongoing for the rest of the year — 250,000 to 300,000 bank cubic meters of alluvial gravels have already been identified for exploration.

Aside from Lulo, its flagship project, Lucapa also has a diamond-producing mine in Lesotho, as well as early stage exploration projects in Western Australia and Botswana.

Shares of Lucapa sat flat on Thursday (March 21), trading at AU$0.18.

Don’t forget to follow us @INN_Resource for real-time updates!

Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.

Featured
Global News

WHAT'S IN STORE FOR THE RESOURCE SECTOR IN 2022?

The Investing News Network (INN) spoke with analysts, market watchers and insiders about which trends will impact this sector in the year ahead.
✓ Trends   ✓ Forecasts    ✓ Top Stocks



read more Show less

Rio Tinto Iron Ore Chief Executive, Simon Trott and Rio Tinto Managing Director of Port, Rail and Core Services, Richard Cohen, joined community members, local businesses and representatives from local government to celebrate the official opening of its new community ‘Hub’ in Karratha. Located on Ngarluma country in the heart of Karratha’s CBD, the new Rio Tinto Karratha Hub will make it easier for local …

Rio Tinto Iron Ore Chief Executive, Simon Trott and Rio Tinto Managing Director of Port, Rail and Core Services, Richard Cohen, joined community members, local businesses and representatives from local government to celebrate the official opening of its new community ‘Hub’ in Karratha.

Located on Ngarluma country in the heart of Karratha’s CBD, the new Rio Tinto Karratha Hub will make it easier for local people to connect with our busines.

read more Show less

Rio Tinto is progressing an innovative new technology to deliver low-carbon steel, using sustainable biomass in place of coking coal in the steelmaking process, in a potentially cost-effective option to cut industry carbon emissions. Over the past decade, Rio Tinto has developed a laboratory-proven process that combines the use of raw, sustainable biomass with microwave technology to convert iron ore to metallic …

Rio Tinto is progressing an innovative new technology to deliver low-carbon steel, using sustainable biomass in place of coking coal in the steelmaking process, in a potentially cost-effective option to cut industry carbon emissions.

Over the past decade, Rio Tinto has developed a laboratory-proven process that combines the use of raw, sustainable biomass with microwave technology to convert iron ore to metallic iron during the steelmaking process. The patent-pending process, one of a number of avenues the company is pursuing to try to lower emissions in the steel value chain, is now being further tested in a small-scale pilot plant.

read more Show less
various commodities atop a laptop
Maxx-Studio / Shutterstock

“As we've seen in Ukraine, war has supercharged a number of these commodity prices,” John Forwood told RIU Resources Round-Up attendees.

Investment strategies for weathering and benefiting from current market trends were a hot topic at Sydney's recent RIU Resources Round-Up, held in early May.

Current opportunities and potential future ones were highlighted in the keynote address offered by John Forwood, chief investment officer at Lowell Resources Funds Management.

Quoting a February report from the head of commodity research at Goldman Sachs (NYSE:GS), Forwood explained to attendees that we have reached a “molecule crisis” in the commodity space and are essentially “out of everything.”


This deficit has only been compounded by the war in Ukraine, which has further weakened supply fundamentals and chains.

“When the (war in) Ukraine started, about a month later the commodities index (represented by Bloomberg commodities index) had its highest one-week spike on record, and that's a record going back over 60 years,” Forwood said. “As we've seen in Ukraine, war has supercharged a number of these commodity prices.”

However, according to the CIO, there is still a considerable amount of upward growth potential.

“In terms of where we are in terms of that commodity basket, we're way behind where we were in 2008, pre the (global financial crisis) and after the mining boom of the 2000s,” he told the crowd.

“And we're way behind where the Dow Jones and equities in general have got to,” Forwood added. “So, we think that there's potential for the commodity sector to be just getting started.”

There are also several other factors that are adding tailwinds to the broad sector, according to Forwood, who cited inflation — which is at 5 percent in Australia and 7-8 percent in the US and UK — as a significant contributor.

Looking at the longer-term fundamentals that have gotten us here, Forwood pointed to lack of investment capital as a main driver.

“I think the big one, the long term one, is under investment,” he said, noting that the early 2000s mining boom led to a lot of investment, which we aren’t seeing today.

“But over the last seven or eight years, we've seen a real dearth of capital going back into the sector. And in fact, we've also seen a dearth of M&A — something that we've been looking out for and it's just not happening.”

In fact, as one of the slides Forwood presented laid out, investment from the resource industry back into itself reached a 19 year low late last year.

Despite the lack of large investment, Australia’s junior resource index was up 16 percent at the end of April compared to the broader market and the Dow Jones Index, which had slipped 9 percent.

“So that may represent a rotation from other sectors into the resources sector. And if that is the start of what's happening, that could be very, very significant for resource company prices,” he said, explaining the resource sector is actually very small on a global scale.

“And if you see significant global money flowing into that sector, you know, it's almost the sky's the limit,” Forwood added.

Gold and volatility

While speaking about several commodities, the CIO for Lowell Resource Funds Management took time to highlight how gold could also be positioned for an upward trend, because “commodities do best when inflation is rising, and interest rates are rising.”

He then displayed a chart that indicated gold was the top performer among US stocks and the US greenback during the first six months following the commencement of a Fed rate hike period.

Real interest rates, which are hovering around 0 percent, are likely to have no effect on gold's price because, according to the Forwood, rates would have to be 3 percent or higher to impact gold.

He did warn that stagflation could add more wind to the yellow metal’s sails moving forward.

“We think there's a decent chance of (stagflation) occurring, so what should you buy?” he posited. “If you think that stagflation is on its way, well, the answer is also gold.”

Forwood concluded his address by encouraging attendees to invest in the junior resource space.

“Finally, at the Lowell Fund, we like to invest in junior explorers,” he said.

“Because they're the ones who make the discoveries, and discoveries is where you can really add the most value.”

Don’t forget to follow us @INN_Australia for real-time news updates!

Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

physical coin representing bitcoin

A Canadian fund provider is debuting a version of its popular bitcoin ETF in Australia. Is now the best time for this launch?

Australian investors are getting a new way to invest in the volatile bitcoin space thanks to a deal between an asset management company and a Canadian fund provider.

On May 12, Canadian fund maker Purpose Investments launched a version of its bitcoin exchange-traded fund (ETF) in the Australian market by way of a partnership with Cosmos Asset Management, which is owned in part by the Australian division of Mawson Infrastructure Group (NASDAQ:MIGI).

The fund, called the Cosmos-Purpose Bitcoin Access ETF (CXA:CBTC), is listed on the Cboe Australia exchange, and holds units of the Toronto-based Purpose Bitcoin ETF (TSX:BTCC).


“We have brought together a team of global experts to offer Australian investors access to a truly high-quality product,” Dan Annan, Cosmos Asset Management CEO, said in a statement to investors.

ETF maker pursues rising international interest in cryptocurrencies

In an interview with the Investing News Network (INN), Vlad Tasevski, chief operating officer and head of product at Purpose Investments, said the firm has been actively pursuing ways to offer its crypto funds internationally.

The executive said there has been widespread interest in BTCC since its launch back in February of last year.

As the firm began evaluating how to approach this demand, the company considered setting up shop in the Australian market, Tasevski said. However, eventually the Canadian fund provider went with the partnership route.

Tasevski called Australia “the next logical jurisdiction" for the firm as it expands with its crypto funds.

When asked what makes Australia so attractive for the expansion of BTCC, the executive said it has a similar market structure to Canada, and credited securities regulators in the nation for being more comfortable with cryptocurrency listings than other jurisdictions.

Purpose has strong long-term outlook for digital assets

Although crypto assets are facing a serious ongoing downturn in value that has created significant losses, Tasevski told INN that Purpose Investments is undeterred in its long-term crypto outlook.

“The amount of capital and the amount of people involved in the space has never been higher,” Tasevski said.

The executive said he views his company's offerings as very flexible for investors. “We'll be here for (investors) to actually give them the ability to very easily access it whenever they feel it is appropriate for them,” he said.

Tasevski added that he views the current downturn for bitcoin as “one of the best entry opportunities in the last year and a half.”

​As bitcoin struggles, ETF firm celebrates structural victory

Purpose Investments has suggested to investors that accessing the bitcoin market through its funds is a safer route than going it alone, especially given the current period of remarkable losses.

According to Tasevski, the firm's products offer liquidity to investors and provide a measured approach for people who want exposure in this segment.

“We have been very clear that this is a volatile asset class,” he told INN. “And investors should kind of understand the level of volatility that they will be taking on.”

The investment executive said the infrastructure security provided by the rules ETFs must follow has been a boon as the crypto space faces major volatility.

Even so, BTCC has been rocked in 2022 based on the performance of bitcoin. Over a year-to-date period, the fund had gone down in value by over 35 percent as of the closing bell in Canada on May 11. In the past month alone, BTCC has dropped in value by over 20 percent.

Som Seif, founder and CEO of Purpose Investments, recently said crypto is a “core component” for the firm “when solving problems for (its) customers.”

​Investor takeaway

Digital assets have never been more easily available as tools for all types of investors.

While many experts remain confident in the long-term outlook for bitcoin and other cryptocurrencies, the considerable volatility prevailing in the market can make the space difficult for newcomers to stomach.

So far in 2022, bitcoin losses have highlighted the lack of stability in digital coins — but of course, as some have argued, these big moves can also provide entry points and opportunities for savvy investors.

Don’t forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

Top News

Global News

×