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The Directors of eMetals Limited (ASX:EMT)(eMetals)(Company) are pleased to submit the Quarterly Activities Report and Appendix 5B for the quarter ending 30 June 2022.
Highlights
- Two tenement applications following the acquisition of Salmon Gums Minerals Pty Ltd (ACN 651 315 258) have been granted at the highly prospective Salmon Gums Project in the Albany Fraser Range Province of Western Australia.
- The Company now holds four granted tenements (E63/2049, E63/2066, E63/2126, E63/2127) covering an area of 219 blocks for a total of 630 square kilometers of the Eucla Basin prospective for Ionic Adsorption Clay (IAC) style rare earth element (REE) mineralisation.
- Heritage agreement progressed during the June Quarter at the Salmon Gums Project in preparation of a program of works application.
- Additional prospective tenure applied for and granted at the Twin Hills Gold Project.
SALMON GUMS PROJECT
Salmon Gums holds four exploration licenses (E63/2049, E63/2066, E63/2126, E63/2127) covering an area of 219 blocks for a total of 630 square kilometers of the Eucla Basin in the Albany Fraser Range Province of southern Western Australia (Project).
The Project cover areas underlain by meta-granites of Archaean to Proterozoic age. These granitic rocks are situated within the Albany– Fraser Orogen on the south and southeastern margins of the Yilgarn Craton.
Outcrop of the meta-granites within the Project is rare with majority of the tenements overlain by Cainozoic sediments, aeolian sands and salt lakes. Whilst there are no known occurrences of mineralisation in either area, limited prospecting or exploration has been historically conducted.
From a study of the historical open file reports available on WAMEX(A106697,A97441) the previous exploration which has been conducted has predominantly been for gold and to a lesser extent for uranium, lignite and base metals. The majority of previous exploration involved the completion of various geophysical surveys including aero magnetics, gravity and radiometric. In some cases, this work was followed up by limited soil geochemistry, but no anomalies of significance were defined. Most significantly several of the early explorers completed shallow drill evaluation of various targets.
Figure 1 – EMT Projects
In the period 2006 to 2008 Toro Energy Ltd (Toro) completed 10 aircore drillholes within E63/2127 and assayed the resulting spoil for iron, copper, gold, nickel, lead, zinc, and uranium in a search for uranium mineralisation. On E63/2049 Toro completed six aircore drillholes to a maximum depth of 53 meters but once again no drill intersections of significance were reported for the targeted minerals. On adjoining lease E63/2066 two drillholes reached a maximum depth of 44 meters but no significant results were reported. In 2009 to 2013 Anglogold Ashanti Australia Ltd (Anglo) completed 17 aircore drillholes to a maximum depth of 67 meters in a search for gold mineralisation. No significant results were returned, and the tenements were abandoned. Prior to the aircore drilling Anglogold Ashanti had completed fence lines of auger in an effort to detect gold in calcareous soils. Minor gold anomalism was detected but was deemed insignificant. The holes were also analysed for REE mineralisation and produced a maximum result of 1,108 ppm REE oxides (REO) plus Yttrium.
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EMT:AU
EQR Acquires Leading European Tungsten Producer, Saloro S.L.U., And Secures $25 Million Investment By Oaktree
Highlights:
- EQR agreed binding terms to acquire leading European tungsten producer Saloro S.L.U. from global investment manager, Oaktree
- Transformational acquisition strengthens EQR’s relevance in the global tungsten industry and enhances the Company’s capital market positioning
- As part of the transaction, Oaktree invests $25 million into EQR, through the subscription of 278 million new ordinary shares at $0.09 per share (representing a ~30% premium to the 15 days VWAP)
- Through the combination of operations, EQR becomes the largest tungsten concentrate producer in the Western World, with a robust growth pipeline across two top-tier mining jurisdictions
- The transaction remains subject to various closing conditions, incl. the approval of foreign direct investment agencies both in Australia and Spain
As part of the Transaction, Oaktree will subscribe for 278 million new ordinary shares (“Subscription Shares”) in the Company at an issue price of $0.09 per share (representing a ~30% premium to the 15 days VWAP), amounting to an investment of $25 million. As a result, Oaktree will become a substantial shareholder in EQR with a holding of 15.86% (calculated as of the day of SPA signing) at completion of the Transaction. Oaktree will receive 78 million options, with an exercise price of $0.10 per share, exercisable during the period of 2 years following the date of completion of the SPA (“Options”).
EQR’s Chief Executive Officer, Mr Kevin MacNeill, commented: "This is without doubt an outstanding development and a transformational acquisition for EQR that delivers a huge value opportunity for shareholders. We continue building a robust growth pipeline with the addition of the Saloro operation and considering the exploration ground around the Barruecopardo mine is covering prospective historical workings. Saloro has a great management team which built and commissioned a mine during rough times of Covid and now coming to a stage of sustainable production growth. Our technical and geology teams assessed this opportunity in the recent months and with the installation of their first Tomra XRT sorter we can provide technical assistance to our new colleagues at Saloro to immediately optimise production.”
“We are delighted Oaktree agrees and supports the value proposition of the expanded operation across two jurisdictions through their investment in EQR at a significant premium, demonstrating commitment to the forthcoming value creation journey. We look forward to having a high-profile globally significant fund such as Oaktree, who has been an excellent owner to Saloro, join our share register and support EQR to expand its footprint and strategic positioning in the global tungsten supply chain. We feel this relationship is accretive to our shareholders”, Mr MacNeill said.
Mr Federico Alvarez-Demalde, Managing Director at Oaktree, commented: “We are excited to have selected EQR as partner to acquire Saloro. EQR is a remarkable partner that shares our operational excellence and ESG values, committed to responsible and sustainable practices. This partnership reinforces our conviction about the incredible opportunity presented in the tungsten supply space, and the need to secure sustainable and ESG focused critical metals supply chains. In that capacity, we have found in EQR an excellent team which demonstrated the ability to create lasting value while positively impacting society and the environment.”
STRATEGIC RATIONALE
Through the acquisition of Saloro, EQR adds the leading European tungsten producing mine to its project portfolio, which aligns with the Company’s corporate strategy to become a substantial and globally leading supplier of sustainably produced critical minerals. The expanded scale of operation will further strengthen EQR’s relevance within the global tungsten industry and will enhance the Company’s capital market positioning.
The Transaction provides EQR’s shareholders an exposure to two geographically diverse tungsten operations across top-tier mining jurisdictions and a re-rating opportunity due to enhanced production scale and exploration upside within the exploration permits at Mt. Carbine and Barruecopardo.
Both assets have been de-risked in recent years, now being in an early production stage having a well- established and even complementary customer base with tungsten downstream players in Asia, Europe and North America. Both operations under a combined leadership and complementary expertise will provide cost- saving as well as significant operational synergies. Saloro is in the process of integrating highly efficient XRT Sorters into the process circuit, an area of core competence of EQR. At the same time EQR is currently preparing the ramping up of the Mt Carbine Open Pit Operation, an exercise that Saloro has gone through over the last 3 years as part of their reactivation of the historic Barruecopardo mine.
BACKGROUND ON SALORO S.L.U.
Saloro is a Spanish company dedicated to the production and marketing of tungsten, an industrial metal with a wide range of applications, which the European Union recognizes as a ‘Critical Raw Material’. With a 30-year (renewable) mining license Saloro’s flagship producing asset is the Barruecopardo mine located in the Spanish Province of Salamanca.Barruecopardo has a mining history dating back almost 100 years. Historic activities ceased at the old mine in the early 1980s. After 10 years of preparation including a 15-month construction period, Saloro brought the Barruecopardo mine back online in early 2019 leveraging modern technology after nearly 40 years of shutdown.
Fig.1 - Selected tungsten projects (as of October 2022) across the Iberian Peninsula, with only two operating mines (in blue)
Mining and concentrating activities at the mine are designed to minimise any environmental impact while ensuring a high mineral recovery. Current production is approximately 140 tons/month of high-grade (>65% WO3) tungsten concentrate, with various minor plant expansion projects ongoing for higher recovery and throughput.
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This article includes content from EQ Resources, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
