Despite improving market dynamics, one of the sectors still largely flying iunder the investors' radar is the junior end of the mineral sands industry. We have seen steadily increasing prices for both ziron and titanium feedstocks over recent times, with these forecast to stay strong for the foreseeable future, due to increasing demand and tightness in supply.
The market has shown that material advances in quality HMS projects can generate good shareholder returns, with a prime example being Sheffield Resources, which is heading towards development of the high grade Thunderbird deposit in Western Australia. Sheffield is just one of a handful ASX-listed HMS focussed companies with projects in Australia. Another one is Broken Hill Prospecting, better known for the interest in the Thackeringa Cobalt Project near Broken Hill (and more on this later).
BPL has, through a review of historical exploration data, taken a major position (the largest of any company) in the Murray Basin, targetting high grade, coarse and low slimes (hence relatively easily treated) strandline HMS deposits. The tenements include areas of known mineralisation discovered by the majors, but considered not worthy of further work by these larger companies. These however potentially provide an ideal development opportunity for a junior. The Company's strategy is to verify such occurrences uncovered in the exploration data review (which it has to date in the case of the Jaws and Gilligans deposits), and assemble an inventory of such deposits that may provide an opportunity to treat using a mobile plant.
Onto the cobalt. Cobalt Blue (ASX:COB), one of the most successful IPOs of 2017, is a special purpose vehicle spun out of BPL to develop the Thackeringa Cobalt Project near Broken Hill. A positive PFS was recently completed for Thackeringa, which also has considerable resource upside potential with a significant strike length of the host stratigraphy remaining untested. Should the Project be successfully developed, BPL will retain an NSR interest.
Last but not least are the other highly prospective Broken Hill base and precious metals exploration interests. These include the Thackeringa Cobalt Project tenements (for which BPL retains the rights to base and precious metals, and industrial minerals), and a number of recently granted tenements covering the prospective Thackeringa and Broken Hill Groups, which are prospective for Broken Hill style mineralisation amongst others. The Company has an active exploration programme over these tenements, which will result in a steady news flow, along with that coming from Thackeringa (via COB) and the mineral sands projects.
We have recently completed a note on BPL, which, by virtue of its market capitalisation, has excellent leverage to exploration success. This note can be downloaded via the link below.
Good to see another article highlighting the potential for Australian mineral sands companies Mark. However I believe Strandline (STA) is still significantly underrated and undervalued by the market. Fungoni is on the verge of coming to fruition, and then Tajiri. While Coburn will also happen soon I believe. Coburn is low insitu tonnage, but has the advantages of high VHM grades, low slimes, low capex and opex, and will have a strategic partner within months, and then comes production.