MarketOpen(ed) Issue #19

KINGSLAND MINERALS

GRAPHITE PROJECT BURNS HOT

PLATINUM REGAINS ITS LUSTRE

MANSOOR’S RADAR:

OMNIA METALS MAKES ITS BEST BET YET

RE-JOYCE

THE LIZARD KING SUGGESTS

AFR FIND A NEW PUNCHING BAG

AFTER THE DEPARTURE OF QANTAS BOSS ALAN JOYCE

Managing Director Stewart Walters

Editor Rueben Hale

Photography Sam Gosling

Market Analyst Mansoor Jan

Contributing Photographers Sam Gosling/Lauren Hale

Managing Director/ Sales Stewart Walters

Social Media Producer Lauren Hale Accounts Katrina Liu

Contributing Writers Tom Duggan/Mansoor Jan/Amanda Ellis

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From The Editor

It is worth noting that Governor Philip Lowe of the Reserve Bank of Australia (RBA) will be remembered for his focus on using inflation as a benchmark to evaluate monetary policy. However, in his final remarks, he acknowledged that he fell short of his main goal, which was to achieve a 2.5% average inflation rate.

As he prepares to leave his position, Lowe has suggested that the government should delegate some taxing and spending powers to an independent body to address the issue of low productivity. He warned that without action, living standards in Australia could stagnate. To improve coordination, he proposed an independent body with limited powers over fiscal policy. Lowe also emphasized that politicians, not the RBA, are responsible for high house prices, and an innovative approach is needed to improve the nation’s economic fortunes.

However, it has come to light that Lowe’s record on inflation was worse than originally thought, as the RBA measures inflation performance based on time spent in the target range. On this measure, Governor Lowe only scored 11 out of 100. This issue with inflation targeting highlights a broader problem - Lowe lacked conviction in the effectiveness of monetary policy. This was illustrated in an exchange with the House Economics Committee on February 7th, 2020. Although conditioning monetary policy on a Phillips

curve relationship may be a mistake, a flat Phillips curve argument calls for more, not less, intervention. Despite a flat Phillips curve, there was still work for monetary policy to do, as evidenced by the US CPI inflation rate falling from 9% to 3% in the last 12 months while the unemployment rate remains low.

RUEBEN HALE

Market Open(ed) Editor

INDEPENDENT RESEARCH

Market Open Australia is intended to be used only for educational and informative purposes, and any information on this website should not be taken as investment advice or guidance. It is important to conduct your own research before making any investment decisions, which should be based on your own investment needs and personal circumstances. Any investment decisions based on information contained on this website should be taken in line with independent financial advice from a qualified professional or should be independently researched and verified. .

Contents Table of

KINGSLAND MINERALS

Kingsland Minerals Managing Director talks about the world class potential of its graphite project in Australia’s Northern Territory.

PLATINUM READY TO RUN

Hydrogen could be the fuel that reignites interest in platinum.

OPEN(ED) SHORTS

THE LIZARD KING

Gives is unrequited opinions on Alan Joyce, weight loss drugs, and another forgettable week on the Aussie stock market.

MANSOOR’S RADAR

This week’s biggest news including Noronex, Black Cat, Pursuit Minerals, MTM Critical Metals Balkan Mining & Minerals and Omnia Metals Group’s success can be attributted its s due to its extensive land holdings in Quebec.

KINGSLAND GETS ITS SCHIST TO GETHER

BY RUEBEN HALE

Ri chard Maddocks says he’s had a “pretty busy” and “fruitful” year. Knowing him as I do, his statement is the equivalent of former Australian cricket captain Steve Waugh saying his boys put in a “decent effort” after winning the Ashes. This equally unassuming boss of Kingsland Minerals has turned an unnoticed uranium play into a top graphite contender in a year.

“I am indeed fond of my cricket, and Steve Waugh was a capable leader,” Maddocks says. “I think he would have made a good explorer because he was a good strategist, knows his history, and would never let an opportunity get past him,” Maddocks said.

How we started with cricket instead of KNG’s huge 206-metre high-grade graphite intersection announced by Kingsland this week is typical of our conversations. The high-grade nature of the Leliyn deposit puts into play the potential for the company to enter the big league as a major supplier to the lithium battery industry.

Kingsland, listed with the Cleo Uranium Project in June 2022, completed a drilling program and, within four months, developed a 6.8 million tonne high-grade uranium resource. But Maddocks, never complacent, took days off from a busy drilling schedule to investigate an area that bore the proper geological signatures for graphite. The only question was if it was untainted by other heavy metals.

“Early indications were good, and we’re yet to be disappointed since we confirmed the 20-kilometre graphitic schist in February,” Maddocks says.

Managing Director Richard Maddocks

Like many projects, the proof will be in the pudding. Many factors can derail advancement, and ‘natural graphite spherical grinding and shaping production incorporated with a flotation plant for anode material’ is a mouthful to say. Still, it may be highly doable, given the high grades of graphite recorded so far.

Market Open’s resource analyst Mansoor Jan explains that Kingsland’s high grades can simplify the beneficiation process for anode-grade specifications and smoothing.

“Good grades make everything better,” Jan says.

“The high grades are supported with the first petrographic analysis that confirms graphite flake sizes potentially amenable to the downstream production of battery anode material,” Maddocks adds.

“More test work is required, but knowing we have the right graphite flakes is encouraging.”

With each drill result, confidence grows that this entire deposit is exceptional and has graphite flake sizes suitable for producing battery anode material. Although more drilling is needed, the work has confirmed the deposit’s vast tonnage scale.

“By the end of the March 2024 quarter, we plan to complete an initial mineral resource assessment for the Leliyn Graphite deposit,” Maddocks says.

“We’re excited to see the assessment results to learn about the deposit’s size and quality. We’re also interested in how the graphite ore performs in a flotation circuit, as we aim to produce a superior graphite concentrate. If successful, we’ll refine the process and produce the end goal – crucial purified spherical graphite for the lithium-ion industry.”

11.3% Total Graphitic Carbon

“I AM INDEED FOND OF MY CRICKET, AND STEVE WAUGH WAS A CAPABLE LEADER”

45 Metres @ 1.0% Copper Equiv alent Hit at Fiesta project in Namibia

NORONEX’S THICK HIT

Noronex is excited to have discovered a 45-meter-thick copper and silver deposit at its Fiesta project in the Kalahari Copper Belt. This discovery has encouraged the company to explore further. The deposit is a thick copper and silver vein of primary chalcocite mineralization that is over 100 meters away from previous findings. The company has successfully completed six holes and is dedicated to pursuing further exploration and discovery in the area

BLACK CAT SOFTLY PURRS PROSPECTIVE PURSUIT

Recent drilling by Black Cat Syndicate has revealed high-grade gold in the central part of the Main Zone at Paulsens Gold Operation. These intercepts are beyond the current mine plan, suggesting the potential for an extended mine life and increased cash flow. The company plans to commence drilling on the untapped Belvedere system, which has high potential for discovery. Early investors are likely feeling more confident after the company’s impressive results to date.

Recently, a CSAMT survey led to the discovery of multiple new lithium brine target zones at Pursuit Minerals Mito prospect part its Rio Grande Sur Project. Mito is located some of the most extensive tenements in Argentina’s portion of the Lithium Triangle. Pursuit’s territory also covers an inferred 2.1 million tonnes shallow lithium carbonate equivalent resource established at the Rio Grande Salar.

MTM SEE REE AT POMME BALKAN DRILL READY DUSTY NICKEL GROWS

MTM Critical Metals’ first diamond drilling yielded promising results at its Pomme REE project in Canada. Each of the 13 holes revealed visual REE mineralisation, indicating a large mineralised system. The program dentified many zones of higher-grade mineralisation in the most prospective parts of the complex.

Balkan Mining and Minerals let the market know drilling is imminent at its Gorge lithium project in Canada to test the vertical plunge extensions along a potential pegmatite strike, six holes are planned for both Koshman and Nelson. Access trails will be cleared, and site preparation will begin to allow drilling to start in the first half of September.

Toro Energy had a great week after confirming a massive nickel-sulphides at Dimma, one of four massive and semi-massive nickel sulphide discoveries within its Dusty Nickel Project in Western Australia. Ni-sulphide has been discovered in all five drill holes at the promising Dimma area. The Dusty Nickel Project has four discoveries that are still open

The Lizard King

Joe Aston must feel like a man without a purpose now that Alan Joyce is gone, but I’m sure the fiery Financial Review writer will find a new target to square against. It’s certainly more enjoyable than another story about a CEO who rides a bike or drinks a cup of coffee in the morning – wow, what a real human being!

It must be nice to be praised for humdrum activities like you were a toddler. I prefer a CEO who admits to practicing facial expressions in the mirror or wondering how much more their employees would be worth as Soylent Green.

But who needs food when you have Ozempic? The weight loss drug has apparently accounted for a hefty portion of Denmark’s GDP, but the Euros should be worried about making Americans too thin and losing one of their only bragging rights.

And I consider weight loss drugs to be cheating, like that AI stock portfolio that beat some of Australia’s top managers. I’d prefer to write ASX codes on balls for an octopus to pick like it’s a World Cup match. As much as I love finals footy, it reminds me of Hunter S. Tompson and his final work - Football Season is Over. The end is now near, and I’ll soon be left wondering what to do with my weekends. I could spend some time with the kids, but sometimes you’ve gotta leave ‘em wanting more.

It was also the end of Philip Lowe’s tenure as RBA governor, and he bowed out with class and a standing ovation after copping some criticism through COVID, which was far from the worst thing to happen in the pandemic.

That would be a rendition of Imagine by those wieners in Hollywood, which is a shame because I thought the laughable attention-seeking would continue through the pandemic, but they just peaked so early. But peaking too early wasn’t a worry for the ASX this week. We have a bit to come back from after a lot of red outside the energy sector, who have the Saudis to thank for cutting production, and the rest of the world can give them a tip of the cap for taking away our fading star athletes for absurd sums of cash.

It’s a sad sight to see someone who has hung around for too long, and on that note – I’m out!

The decline in production has sparked a surge in demand for platinum mining in Australia. With a growing hydrogen supply chain and the crucial need for supply diversity, the importance of this industry cannot be overstated.

The last chance the bull was going to run on platinum came around in 2021, driven by fears a reduction in carbon emissions could be a catalyst for waxing demand for PGEs because of their crucial role in lessening environmentally damaging exhaust fumes. And the bull calls were right - for a time. PGE demand rose from the desire to reduce pollution, and both platinum and palladium hit strong trading prices at the time. During this exciting period, there was a surge in exploration that ultimately led to Chalice Mining’s discovery of Gonneville. This mine is expected to be the first in Australia to produce PGEs, especially palladium, as the primary metal and not just as a by-product. Furthermore, the mine is supported by the presence of nickel, copper, and cobalt reserves that are often found alongside.

Last year, Chalice Managing Director and CEO Alex Dorsch said that the company had effectively created a national PGE industry with Gonneville.

“For 50-plus years, the world has been totally reliant on Russia and South Africa, and to a lesser degree North America, for supply of incredibly valuable and scarce platinum group metals,” Dorsch said.

Dorsch boldy labelled the project a significant discovery for Australia with its millions of tonnes of contained precious metals and nearly a million tonnes of base metals as icing on the cake.

But it was only a short time. Attention quickly turned from reducing petrol toxicity towards the electric vehicle, leading to a run on battery-critical metals that endures to this day, and the Chalice share price, once

THE BULL GETS READY TO RUN AGAIN ON PLATINUM POWER

approaching $10 a piece, has fallen to beneath $3. But the commodity cycle keeps turning, and Bank of America Global Research commodities analyst Michael Widmer declared that a growing global hydrogen supply chain could be made of platinum.

Historically produced using nickel-containing alkaline water electrolysers, the fast-emerging hydrogen industry has significantly shifted towards platinum-intensive production.

If the method becomes the primary way of producing hydrogen and accounts for 70 per cent by 2030, it could lead to an additional demand of 778,000 ounces of platinum. This number could reach 2.4 million ounces in an accelerated scenario.

They are numbers backed up by others. The World Platinum Investment Council are more bullish, predicting corresponding demand from hydrogen to reach 2.7 million ounces by 2030, more than 80 per cent of current demand from automakers, while Commerzbank expects hydrogen applications to account for one-third of the total market by the end of the 2030s.

The Macquarie base case is lower in the short term, but the financial group still see demand across fuel cells and electrolysers approaching two million ounces by 2040. The World Platinum Investment Council expect demand to climb by 27 per cent this year to 8.23 million ounces, with supply to not nudge much from last year’s

production of 7.224 million – a one-million-ounce deficit.

Metals Focus predicts no increase in platinum production. South Africa is the only potential source, but an energy crisis could significantly impact production. The country’s platinum supply accounts for 73 per cent of the global total, and electricity availability affects smelting capacity. During load shedding in 2008, platinum prices reached a record high of US$2160/oz. Eskom has asked mining companies to reduce power usage to alleviate shortages.

Despite the challenges we face with the energy crisis, there is hope for a brighter future. By addressing issues such as decrepit power stations, mismanagement, and corruption, we can work towards a more reliable and sustainable energy grid. While there may be concerns about power shortages and outages, we must remain optimistic that solutions can be found. The recent decrease in palladium prices and slower demand from China may present challenges, but we can look to the future and focus on accelerating hydrogen production and development. This effort, coupled with ongoing efforts to revive the PGE industry, has the potential to bring about a new era of prosperity and innovation. Let us remain hopeful and work towards a better tomorrow.

PLATINUM GROUP METALS

Rhodium is a precious metal used to strengthen platinum. It has a shiny, silver-white appearance and high reflectivity for light.high reflectivity for light.

Iridium is a hard, silvery metal. It is almost as unreactive as gold. It has a very high density and melting point. Iridium is the most corrosion-resistant material known.

“FOR 50-PLUS YEARS, THE WORLD HAS BEEN TOTALLY RELIANT ON RUSSIA AND SOUTH AFRICA FOR PLATINUM GROUP METALS”

Chalice Managing Director and CEO Alex Dorsch

Diamond drill core samples from Chalice Mining’s Gonnville Project in Western Australia.

MANSOOR’S RADAR

SENAI 5 AND AN EXTENSIVE >60,000 HECTARE LAND PACKAGE

Omnia Metals Group’s success is attributed to its vast land in Quebec’s Lac des Montagnes and Dr. James Warren, a geologist from rural Albany-Katanning who completed his PhD thesis on gold and is now dedicated to discovering a lithium deposit in Quebec from scratch.

In 2021, Omnia Metals was established, initially focusing on the Kimberly Cu and Ni projects. However, like many other Australian companies, Omnia Metals shifted towards Canada’s James Bay region in search of lithium. What sets Omnia Metals apart from other junior Canadian-focused ASX companies is their extensive land package, uncomplicated board structure, and strong financial supporters.

Although the lithium market is struggling, Omnia Metals believes there is untapped potential. With a capable management team and dedicated field crew, they aim to provide investors with positive returns. Some investors are particularly interested in their winter drill program and believe that Omnia Metals has the potential to deliver significant results.

Schedule:

We understand that fire and rain events in Quebec have caused delays, and there will be a full closure of field programs for goose and moose/antler hunting in May and October, respectively. Some schedules have accounted for delays, while others may shift the entire work program forward.

Cash Position:

OM1 ended the financial year with $3.8 million in the bank. Completing the current field program and lab assays will cost around $1.72 to $2.3 million. However, Omnia Metals will require a material capital raise before the drill program commences. The estimated cost of completing a 25DH, 3500 meter, shallow 150-meter depth drill program is around $3.22 to $3.68 million.

Multiple High-Priority Targets:

Omnia completed its due diligence process, which included compiling a GIS database, acquiring high-resolution satellite imagery, and interpreting the results. Following this process, we have identified multiple high-priority targets, with newly acquired high-resolution satellite imagery confirming significant surface exposures of pegmatite bodies.

Current Field Exploration Data Assessment:

Our team completed the first pass of fieldwork with only 10% of the samples collected. The preliminary results provided great insight into using XRF sampling and the correlation between the Potassium/Rubidium (K/Rb) ratio. The K/Rb ratio is a widely used metric for evaluating pegmatites’ fractionation state and mineralisation potential, with spodumene-bearing zones typically having a percentage ranging from 5 to 30 K/Rb. We have found that most of the Omnia Metals samples were collected from the region with a less evolved geological signature, and lab assays confirmed a higher K/Rb ratio. Our assessment of the initial field program indicates that we need to expand it, eliminate barren outcrops quickly, and ramp up activities given the limited time before the snow season.

Where is Potential Mineralisation?

We consulted an independent geologist who identified Senai 5 as a prospective location for the next Omnia Metals field program round. However, the field crew must go approximately 25 to 30 kilometres west of the first-round field exploration program to find slightly evolved mineralised rocks.

Potential Rerate Announcement – Next 4 to 6 Months

With a very small SOI, any solid update on mineralisation could trigger a massive rate for OM1. This could be discovering mineralised rock chips or a premium flowthrough raise.

LAC DES MONTAGNES LITHIUM D

540 KM2 OF ARCHEAN AGED GREENSTONE BELT

GET THE DATA ON SENAI 5 >>

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