Rex Minerals pops on $393m MACH buyout
Encounter encounters further >3% niobium at Aileron in West Arunta
Core Lithium bounces from the floor on exceeding final half-year production
Here are the biggest small cap resources winners in morning trade, Monday, July 8.
Rex Minerals (ASX:RXM)
RXM shook the market in early trade today, announcing a likely buyout by major shareholder MACH to the tune of $393m.
The company has entered into a scheme implementation deed between the two that will see MACH acquire all of the shares it does not already own for a cash consideration of 47cps.
It’s a whopping 79% premium to the 30-day and 98% to the 90-day VWAP (volume-weighted average price) and an astonishing 176% premium to the offer price for RXM’s most recent entitlement offer in January this year at 17c.
At the takeover price, Rex shareholders will receive a 10-year high price payout.
(volume-weighted average price)Back in January, MACH, a subsidiary of Indonesian-based Salim Group, entered the fray as a cornerstone investor, pouring in $11.8m as part of a $29.8m raise.
RXM had since been hunting for partners to fund development of its Hillside copper-gold project in South Australia to the tune of $894m.
Hillside is ready for development and contains a 1.9Mt copper and 1.5Moz gold resource.
Set out in the current mining plan, Stage One mine will produce about 42,000tpa copper and 30,000ozpa gold over 11 years with a payback period of just 4.3 years.
“The South Australian government has been a leader in Australia in support of decarbonisation and copper development and the successful development of Hillside will very much align with their strategy,” RXM CEO Richard Laufmann says.
“Subject to approvals, we look forward to working with MACH through to completion and watching them develop the Hillside project, Australia’s largest fully permitted and shovel ready copper project.”
Shares shot up 63.6% on open to trade at 45c per share.
Encounter Resources (ASX:ENR)
Talk-of-the-town commodity niobium is once again in the news as ENR announced more high-grade intercepts of Nb2O5 at the Crean and Emily targets of its Aileron project in WA’s West Arunta critical minerals district.
The Aileron tenements are adjacent to WA1 Resources’ (ASX:WA1) world-class 200Mt Luni carbonatite niobium discovery and exploration is showing potential for repeating that success.
Assays 200m east of the impressive drillhole EAL256 (52m at 3% Nb2O5 from 81m) at Crean have returned additional shallow, high-grade niobium-REE mineralisation including:
46m at 3.1% Nb2O5 from 60m to EOH including 4m at 6.4% Nb2O5 from 84m at hole EAL239
18m at 3.2% Nb2O5 from 76m including 2m at 17% Nb2O5 from 76m at hole EAL238
Results at the Emily target from the 2024 AC drilling campaign adjacent to hole EAL098 (12m at 2.3% Nb2O5 from 55m) cropped up:
16m @ 2.7% Nb2O5 from 50m to end of hole at EAL260
20m @ 2.7% Nb2O5 from 41m to end of hole at EAL225
“Aircore drilling is defining new belts of shallow niobium-REE carbonatite-hosted mineralisation in the West Arunta,” ENR exec chair Will Robinson says.
“Highly enriched, near surface mineralisation has now been intersected at both the Crean and Emily targets which are on separate structures at Aileron, over 10km apart.”
The explorer has been on a heater since June 18 when shares were just 30c.
ENR shot up 24% at open and have since settled, yet still 16.4% to the green at the time of writing, trading at 86c per share.
Source: Encounter Resources.
St George Mining (ASX:SGQ)
(Up on no news)
Another budding niobium hunter, SGQ released a large exploration target for its Destiny project in (no, not West Arunta this time) – WA’s Eastern Goldfields – back on 18 June, about 2.1km in diameter.
SGQ reckons the C1 target has the same characteristics of mineralised carbonatites at Lynas’ (ASX:LYC) Mt Weld REE project and WA1 Resources’ (ASX:WA1) niobium-REE Luni deposit.
Gravity surveys completed in April identified a gravity high in the core of C1, indicating the presence of dense material and were followed up with surveys that have delineated priority drill targets.
Another gravity survey was also carried out over the C3 target, interpreted as an intrusive magnetic feature located along a regional scale 30km fault that is a splay to the Ida Fault.
A Programme of Works (POW) and heritage clearance applications have already been initiated in preparation for drill testing, which is anticipated to begin in the second half of 2024.
Shares in the ASX junior have spiked another 20.8% today, trading at 3.2c per share.
Core Lithium (ASX:CXO)
It’s been a while since positive news has come out of lithium producer CXO after it halted production from its Finniss lithium mine in the NT in January, due to tough market conditions and higher than expected production costs.
A revised FY24 guidance of 90,000-95,000dmt was exceeded in H2 FY24, producing 95,020dmt of spodumene concentrate, and sales exceeding the top target of 90,000dmt for 97,423dmt.
All stockpiles are now processed and the mine will pause until, as CEO Paul Brown puts it, “we are confident the lithium market conditions support such a decision”.
“Central to this is putting Finniss in a position where operations can rapidly resume with minimal capital,” Brown says.
“Our strategic focus will be on making Finniss a more robust operation in the future, and exploration is a key enabler of this.
“In FY25, we will be drill testing priority targets around Finniss, potentially adding meaningful life to future lithium mining operations.”
CXO has an unaudited cash balance of $87.6m to focus on exploration.
Shares rose on the sombre yet perhaps hopeful news regardless, swapping up 15.39% early today at 10.5c.
Sunrise Energy Metals (ASX:SRL)
(Up on no news)
Last we heard about SRL was that the company is still trying to advance development of its Sunrise project in NSW but not going anywhere fast with it.
Delays in financing the $600m Sunrise Battery Materials project have seen the stock price fall substantially from $3.10 in April 2022 to a massive low of 32c two weeks ago.
There must be something in the mix with a week of positive trade so far. Perhaps the seemingly dead cat bounced on news that CFO Ben Stockdale resigned on 24 June, as the stock price has turned the corner since and is now trading at 52c per share, up 26.8% in daily trade.
At Stockhead we tell it like it is. While St George Mining is a Stockhead advertiser, they did not sponsor this article.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
The post Resources Top 5: Electric dreams spark ASX juniors upwards appeared first on Stockhead.
