Weekly Nugget

Russian Miner Sets Up Physical Fund for Copper and Nickel

Bloomberg reports that Russian metals company MMC Norilsk Nickel is financing an offering of exchange-traded commodities, nickel and copper.

Nicholas LePan
Jun 18, 2021

Bloomberg reports that Russian metals company MMC Norilsk Nickel is financing an offering of exchange-traded commodities, nickel and copper, on the London Stock Exchange, expanding options for investors to tap into the physical metals markets.

This new type of fund is responding to growing interest in commodity investing. ETC or exchange traded commodities offer investors without direct access to spot or derivatives markets exposure to various commodities. The five largest industrial-metals exchange-traded products saw their biggest ever inflows in April.

“The new digital instruments are a great opportunity for investors to benefit from the rising demand for the base metals.”- Anton Berlin, Nornickel’s sales chief.

The new ETCs are the first physically backed nickel and copper exchange-traded products. The fund is also the first ETC issuer to use a blockchain to record purchasing information. The metal backing the ETCs is stored in warehouses in Rotterdam.

While Nornickel’s ETCs may expand market access for investors, consumers have railed against proposals for similar funds in the past.

In 2013, several major U.S. copper consumers approached the Securities and Exchange Commission to block the founding of physical ETFs developed by BlackRock and JPMorgan, arguing that they would leave less copper available for manufacturers, worsening shortages and boosting prices.

Earlier this year, the Nornickel fund started trading precious-metals ETCs in Frankfurt and London. It also sold its first metals-backed digital tokens to industrial clients Traxys and Umicore in December. The company would like to sell 20% of its output using the tokens.

There are 1180 copper projects on Prospector Portal.

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Greenland Gives Greenlight for Construction of Titanium Mine

The Government of Greenland approves exploitation and closure plans for BlueJay Mining’s (LON: JAY, US-OTC: BLLYF) Dundas Ilmenite project, which is the final government-level approval required before construction at Dundas can start. Ilmenite is an ore of titanium.

"The permit covering the Dundas Ilmenite Project's Exploitation and Closure Plan is the final government approval required to enable the commencement of construction. Following the receipt of our approved Exploitation License, we continue to finalize the optimization planning and engineering sign-off, together with advancing discussions with partners to form a strong project financing syndicate..." - Chief Executive Officer Bo Moller.

In December, the Greenland-focused explorer and developer was granted the exploitation license for Dundas. The license grants Dundas Titanium, a wholly-owned subsidiary of BlueJay, the rights to the ilmenite resource at Dundas and is valid for an initial 30-year period.

BlueJay signed an agreement with Rio Tinto Iron and Titanium Canada (RTIT) to further analyze Ilmenite at RTIT’s Sorel-Tracy plant in Quebec, Canada, where Rio is developing steel powders for 3D printing.

A JORC compliant resource estimates 117 million tonnes at 6.1% ilmenite (in situ), with an additional exploration target of between 20 – 60 million tonnes at between 6% and 10%. A pre feasibility study envisions an initial capital expenditure of US$245M.

BlueJay is now focused on securing financing ahead of commencing commercial production at Dundas. Once in operation, revenue from the mine can support future exploration and acquisitions.

The company’s other assets in Greenland include the Disko-Nuussuaq nickel-copper-cobalt-platinum-gold project; the Kangerluarsuk zinc-lead-silver project; and Thunderstone, which has the potential to host large-scale base metal and gold deposits. In Finland, it has a joint-venture agreement with Rio Tinto (NYSE: RIO: LSE: RIO; ASX: RIO) to advance the Enonkoski nickel project.

There are 9 projects with technical reports on Prospector Portal.
 
 

Private Equity on the Hunt for Mining Projects

London-based private equity firm, Appian Capital Advisory, is growing its exposure to copper production on a bet that the metal will be scarce in the coming years. Appian’s Brazilian unit Mineracao Vale Verde “MMV” is completing construction of a new mine in the country’s northeastern region and is already eying an expansion according to Paulo Castellari, head of operations in Brazil. 

Appian has invested $200 million in Serrote, acquiring the project from Aura Minerals three years ago. The mine is set to make its first shipment of 4,000 tons of semi-processed copper in November as part of a five-year offtake agreement, ramping up to an annual capacity of 22,000 tons near the end of next year. Plans include building a second plant and using nearby deposits to increase production by 40%.

In Brazil’s Bahia state, Appian restarted the Santa Rita open-pit nickel mine in late 2019 after buying it from the bankrupt Mirabela Nickel. Appian’s will begin feasibility studies into a $250-million underground project to boost output and extend the mine life.

With $1.2 billion under management, Appian is on the hunt for new projects, Castellari said. Exit strategies from its Brazilian projects are undefined, and could include bringing in a strategic partner or even going public, he said.

In January, Appian secured another $750M for a second mining fund. Since the launch of its flagship mining and metals fund in 2014, the London-based firm has made nine investments with six mines now in production and another two likely within the next two years.

There are 103 mining projects in Brazil on Prospector Portal.

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AI Technology to Look for New Mineral Deposits

[Summary of an article written by Henry Lazenby of the Northern Miner]

GoldSpot Discoveries Corp. (TSXV: SPOT; OTCQX: SPOFF) will use its proprietary machine learning and artificial intelligence technology to look for lithium and tantalum exploration targets at Critical Elements Lithium‘s (TSXV: CRE; US OTCQX: CRECF) properties in Quebec, Canada.

GoldSpot will work closely with the Critical Elements technical team to analyze geoscience data to develop and refine exploration targets at the company’s 100%-owned assets encircling the advanced Rose lithium project. The 700 sq.km of prospective lands are said to feature several lithium showings and nickel, copper, and gold.

The GoldSpot AI approach can take large land packages and distil all available layers of geological information to identify the most efficient and cost-effective way to explore the prospective ground.

 Click Here to Read the News
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