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S&P/ASX 200 futures support a another positive day ahead

S&P/ASX 200 (INDEXASX:XJO) (ASX:XJO) futures are up around 4% heading into the open as the ASX 200 looks to build on yesterday's gains of 2.30% to 5,113.30.

US markets put together their third positive day and importantly finished near their highs.

The S&P 500 Index (INDEX:. INX) closed at 2,630.07, +154.51 or up 6.24% and the Nasdaq Composite (INDEXNASDAQ: .IXIC) closed at 7,797.54, +413.24 or up 5.60%.

Notably, the rally was in the face of a record data result that showed 3.2 million Americans filed for unemployment benefits in a week.

This was four times higher than the previous record of 695,000 back in 1982.

This chart from Bloomberg shows the truly historic surge in weekly unemployment claims in the U.S. pic.twitter.com/bSESy35cgZ

— BNO Newsroom (@BNODesk) March 26, 2020

In our local market. Cochlear Limited (ASX:COH) traded positively yesterday after raising $800 million in a share placement priced at $140, it closed up 8.43% at $182.17.

Gold flat, oil down and AUD ..

S&P/ASX 200 (INDEXASX:XJO) (ASX:XJO) futures are up around 4% heading into the open as the ASX 200 looks to build on yesterday's gains of 2.30% to 5,113.30.

US markets put together their third positive day and importantly finished near their highs.

The S&P 500 Index (INDEX:. INX) closed at 2,630.07, +154.51 or up 6.24% and the Nasdaq Composite (INDEXNASDAQ: .IXIC) closed at 7,797.54, +413.24 or up 5.60%.

Notably, the rally was in the face of a record data result that showed 3.2 million Americans filed for unemployment benefits in a week.

This was four times higher than the previous record of 695,000 back in 1982.

This chart from Bloomberg shows the truly historic surge in weekly unemployment claims in the U.S. pic.twitter.com/bSESy35cgZ

— BNO Newsroom (@BNODesk) March 26, 2020

In our local market. Cochlear Limited (ASX:COH) traded positively yesterday after raising $800 million in a share placement priced at $140, it closed up 8.43% at $182.17.

Gold flat, oil down and AUD continues to regain lost ground


Gold is up 0.36% overnight to US1,639 per ounce and Crude Oil WTI is down 5.4% to US$23.16 per barrel.

The AUD continues to rally off its recent lows, now buying 60.45 US cents, well below where it started the month at 66 US cents but also well off itsRead More – Source

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Australia

Blackstone Minerals surges on $6.8 million investment from cathode materials manufacturer EcoPro

Blackstone Minerals Ltd (ASX:BSX) has attracted a $6.8 million investment at a substantial premium after signing a binding share purchase agreement with EcoPro Co Ltd, the worlds second-largest and Koreas largest nickel-rich cathode materials manufacturer.

Securities surged more than 52 per cent on the news to an intra-day high of 16 cents, up from 8 cents at close on March 19.

The binding share purchase agreement outlines a firm commitment to raise $6.8 million before costs through a placement of 40 million shares at an issue price of 17 cents per share, which represents a 62% premium to Blackstone Minerals last traded price on Monday.

It also outlines an alliance structure whereby EcoPro and Blackstone Minerals will work in partnership, through additional investment by a joint venture, to develop a downstream processing facility in association with Blackstone Minerals Ta Khoa Nickel-Platinum Group Elements (PGE) Project in northern Vietnam.

“Strengthens alliance with EcoPro”[hhmc..

Blackstone Minerals Ltd (ASX:BSX) has attracted a $6.8 million investment at a substantial premium after signing a binding share purchase agreement with EcoPro Co Ltd, the worlds second-largest and Koreas largest nickel-rich cathode materials manufacturer.

Securities surged more than 52 per cent on the news to an intra-day high of 16 cents, up from 8 cents at close on March 19.

The binding share purchase agreement outlines a firm commitment to raise $6.8 million before costs through a placement of 40 million shares at an issue price of 17 cents per share, which represents a 62% premium to Blackstone Minerals last traded price on Monday.

It also outlines an alliance structure whereby EcoPro and Blackstone Minerals will work in partnership, through additional investment by a joint venture, to develop a downstream processing facility in association with Blackstone Minerals Ta Khoa Nickel-Platinum Group Elements (PGE) Project in northern Vietnam.

“Strengthens alliance with EcoPro”


Managing director Scott Williamson said: “We are pleased to announce this investment of $6.8 million at a premium which strengthens our alliance with EcoPro.

“Our Ta Khoa Nickel-PGE Project has the potential to deliver the critical raw materials required for EcoPros cathode manufacturing to meet the demand from the imminent electric vehicle (EV) revolution.

“We look forward to working towards the next stage of our partnership to develop the downstream processing facility in northern Vietnam”.

“Important to secure metal materials”


EcoPro'a Strategic Planning Division vice-president Sangwook Park said: “It is very important to secure stable and competitive metal materials in the fast-growing secondary battery and cathode active material business.

“EcoPro has therefore decided that it is a good time to invest in Blackstone.

“Based on that, we are looking forward to continuing with our partnership so that we can succeed in a downstream JV in the near future.”

Agreement terms


Terms of the agreement include:

  • The placement of 40 million shares at 17 cents per share, to be issued under the companys existing placement capacity with shares to be issued and allotted by April 16;
  • EcoPro to appoint a director to the board of Blackstone Minerals;
  • Blackstone Minerals to exercise the binding option agreement to purchase AMR Nickel Limiteds 90% interest in the Ta Khoa Nickel-PGE Project; and
  • EcoPro and Blackstone Minerals to form an alliance whereby the next stage of the partnership will be an additional investment through a joint venture agreement to develop the downstream processing infrastructure project in association with Blackstone Minerals Ta Khoa project.
  • Read More – Source

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Australia

88 Energy to wrap-up Charlie-1 testing due to “mixed” results

88 Energy Ltd (LON:88E) (ASX:88E) told investors that it has proved movable hydrocarbons in the Charlie-1 well, with sampling confirming a large condensate discovery in the Torok formation.

In a statement, however, Dave Wall, the explorers chief executive, described it as “a mixed result”.

The main Charlie target could not be tested because the formation was found to be “poorly developed” and was therefore not sampled. Oil shows previously noted in Charlie are now deemed to be residual, the company said.

READ: 88 Energy to host AGM online[hhmc]
Some secondary targets were sampled for analysis, others werent successfully sampled.

Joint venture partner Premier Oil PLC (LON:PMO) has decided to withdraw from the project as the drill results did not meet their expectations.

88 Energy noted that the well costs are within the expected budget, and, as a result, the AIM-quoted firm is not expected to incur any costs – they will be covered by the farm-out deal with Premier, which committed ..

88 Energy Ltd (LON:88E) (ASX:88E) told investors that it has proved movable hydrocarbons in the Charlie-1 well, with sampling confirming a large condensate discovery in the Torok formation.

In a statement, however, Dave Wall, the explorers chief executive, described it as “a mixed result”.

The main Charlie target could not be tested because the formation was found to be “poorly developed” and was therefore not sampled. Oil shows previously noted in Charlie are now deemed to be residual, the company said.

READ: 88 Energy to host AGM online


Some secondary targets were sampled for analysis, others werent successfully sampled.

Joint venture partner Premier Oil PLC (LON:PMO) has decided to withdraw from the project as the drill results did not meet their expectations.

88 Energy noted that the well costs are within the expected budget, and, as a result, the AIM-quoted firm is not expected to incur any costs – they will be covered by the farm-out deal with Premier, which committed to spend up to US$26mln.

The well is now being plugged and abandoned, rather than put in suspension to allow further analysis.

88 Energy said there were a number of operational factors in the decision, including the potential for complications due to coronavirus and it being late in the seasonal weather window.

Torok condensate

Prior to drilling, the Torok formation was of secondary interest to the explorer.

Torok hosts the lower, middle, and upper Stellar targets – hydrocarbons were captured from the middle and lower, whilst the upper could not be sampled as this was a sub-optimal location for the target.

Further analysis will be required to determine whether a discovery of this nature can be commercialised on the North Slope of Alaska, given the likely high gas content.

Another target, Indigo, was found to be water-bearing.

Meanwhile, sampling was attempted but could not be undertaken in the better of two Lima targets in this location.

88 Energy noted that a number of the secondary targets were not optimally intersected in the Charlie-1 location and there remains potential for higher quality reservoir elsewhere in the project area.

For example, analysis has indicated that hydrocarbons in the Seabea formation (the Lima targets) appear to be heavier thanRead More – Source

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Perseus Mining has target price raised by Canaccord; Macquarie maintains outperform

Perseus Mining Limited (ASX:PRU) recently updated the life of mine plan (LOMP) for its Edikan Gold Mine in Ghana, West Africa.

Annual gold production is now averaging 212,000 ounces with the expected production of around 231,000 ounces per annum on average over the next four years.

Importantly, the total estimated gold production of 1.307 million ounces over the life of mine is 95% higher than the amount estimated in the previous LOMP.

Canaccord Genuity has increased its target price for Perseus by 19% to $1.90 on account of updating its Edikan model assumptions for the new LOMP.

Macquarie Research expects Edikan production to peak at close to 270,000 ounces in FY24 and group production to reach the companys +500,000 ounces per annum aspiration in FY23.

Following are extracts from Canaccords and Macquaries research updates:

Canaccord
Step change – updated Edikan[hhmc]
LOMP Higher-grade UG provides kicker to updated Edikan LOMP: PRU's updated Life of Mine plan (LOMP) for Edik..

Perseus Mining Limited (ASX:PRU) recently updated the life of mine plan (LOMP) for its Edikan Gold Mine in Ghana, West Africa.

Annual gold production is now averaging 212,000 ounces with the expected production of around 231,000 ounces per annum on average over the next four years.

Importantly, the total estimated gold production of 1.307 million ounces over the life of mine is 95% higher than the amount estimated in the previous LOMP.

Canaccord Genuity has increased its target price for Perseus by 19% to $1.90 on account of updating its Edikan model assumptions for the new LOMP.

Macquarie Research expects Edikan production to peak at close to 270,000 ounces in FY24 and group production to reach the companys +500,000 ounces per annum aspiration in FY23.

Following are extracts from Canaccords and Macquaries research updates:

Canaccord

Step change – updated Edikan


LOMP Higher-grade UG provides kicker to updated Edikan LOMP: PRU's updated Life of Mine plan (LOMP) for Edikan is based on updated Reserves of 1.6Moz at 1.1 g/t, and now incorporates revised pit optimisations (US$1,300/oz vs prior US$1,200/oz), updated unit costs, and inclusion of the higher-grade Esuajah South UG deposit in the mine plan (from FY21).

Increased gold production, longer mine life: The new LOMP delivers an average annual production of 211koz (+22% over prior CGe) anticipated over an extended Reserve life of +6 years (vs prior 4.5 years). While our estimated LOM AISC are mostly unchanged at US$959/oz, forward curve gold price assumptions provide for potentially strong operating margins (AISC margin averaging ~60%) over the remainder of the LOM.

Peak Group production can now be maintained out to 2025: In our view, a key takeaway is a significantly improved Group production profile, with our revised estimates now suggesting that PRU can maintain peak production rates (460-520kozpa) for four years from FY22-FY25. This compares to prior expectations for production to peak in FY22 before declining (Figure 7).

While the benefits to earnings and cashflow are longer dated, the longer mine life and higher production rates from Edikan more than compensates for the relatively short mine life anticipated at Sissingue (notwithstanding potential for incremental additions to Sissingue mine life, i.e. Zanikan).

COVID-19 update – no change to guidance (with caveats): PRU recently reported that it has not experienced any operational impact from COVID-19, with FY20 guidance (260-300koz at US$800-975/oz AISC vs CGe 281koz at US$964/oz) unchanged. Yaoure development timelines (commissioning Dec'20) also remains unaffected. However, PRU noted that the situation remains fluid and should there be any change, guidance (and Yaoure timelines), may be reviewed in Apr'20. We note that PRU maintains a solid balance sheet, with cash and bullion (as at Dec'19) of A$120m, and undrawn facilities of A$166m. In our view, this should provide PRU with a buffer from any minor operational disruption or potential delay at Yaoure.

Valuation & recommendation


Our target price (1x forward curve NPV5%/10%) increases 19% to $1.90 on account of updating our Edikan model assumptions for the new LOMP (project NPV risked to 95% to account for permitting/timeline risks). We maintain our BUY rating.

Macquarie

Event

  • PRU has released an updated life-of-mine (LOM) plan for its Edikan gold mine in Ghana, West Africa.

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