SP Angel . Morning View . Tuesday 27 04 21

Biden looks to pass 80% clean energy from US power generators by 2030



MiFID II exempt information – see disclaimer below

Empire Metals* (AIM:EEE) – ​Drilling restarts at Eclipse

Bushveld Minerals* (LON:BMN) – Mustang Energy Plc acquires 11% interest in Enerox GmbH through VRFB Holdings for $7.5m

Fortuna Silver Mines to buy Roxgold for $884m cash-and-stock deal

IronRidge Resources* (AIM:IRR) – Assore supports IronRidge in £12m placing

Phoenix Copper* (LON:PXC) – Appointment of director and creation of advisory board

Rambler Metals and Mining* (AIM:RMM) – 2020 annual results

Scotgold Resources* (AIM:SGZ) – Operational update from Cononish

Vast Resources (AIM:VAST) – Further progress at Baita Plai


US – Biden Administration looks to pass legislation seeking 80% clean energy from US power generators by 2030 – Reuters

  • The legislation if passed will mark a moment of huge transformation for the US energy industry
  • It will herald a new era of construction for offshore windfarms and for onshore solar instillations
  • The move will undoubtedly drive strong demand for copper, rare earths and other related metals


Copper – The International Copper Study Group ‘ICSG’ report at a small surplus of 28,000t global copper supply / demand vs a 34,000t deficit in December

  • Copper production was 2.10mt vs consumption of 2.076mt


Watchdog warns Diamond Council over ads

  • The National Advertising Division (NAD) rebukes National Diamond Council over environmental claims.
  • The NDC has been told to stop making assertions that lab-grown diamonds emit three times more carbon than mined diamonds as evidence was not sufficient.
  • The NAD also called on the NDC to stop claims that mined diamonds were becoming rarer by the day.




US – Durable goods orders 0.5% in March vs -0.9% in February

  • ex transport 1.6% in March vs -0.3% in February
  • Dallas Fed manufacturing index 37.3 in April vs 26.9 in February


Inflation – Logistics, Lies and Raw Materials

Logistics, disruption, raw materials and Covid-19 working practices are all coming together to fuel inflation

  • The Cost of containers from China to the West has trebled.
  • The Availability of containers from China to Europe is severely restricted.
  • Disruption in unloading containers in congested Western ports is adding to delays and cost.
  • Inflation is coming whether we like it or not
  • Policy makers are likely going to stand back and let it rip through as it inflated borrowings away.
  • Inflation looks like the lesser evil but mortgage costs will need to be held back for homeowners to prevent very substantial levels of default.
  • At what point will The Fed, ECB, BoJ and BoE raise rates?  
  • How will the bond market react to rising inflation?
  • How will governments finance further borrowing is market rates are so much higher?


Chile – Port workers to proceed with protests over pensions while mining bodies mull involvement

  • A group of Chilean port workers began protests against the government’s pandemic relief policies and pensions.
  • Protests at ports began yesterday afternoon and are expected to involve up to 6,000 workers.
  • There are no immediate reports of copper shipment disruptions and mining unions have so far refrained from taking industrial action.
  • A group representing 15,000 workers at Codelco are still mulling the situation, while workers at Chuquicamata vowed to join the protests.
  • The Mining Federation of Chile’s 9,000 private-sector members wont stop work for now, despite supporting the cause.

Peru – Sol slumps to record lows as weekend poll shows strong lead for socialist Castillo

  • zhe poor performance of the sol comes despite a jump in copper prices, which usually benefits the currency of the world’s no.2 producer.


Germany – GDP growth forecast for this year lifted to 3.5% from 3%

  • The German government has raised its growth forecast for this year to 3.5% from a 3% prediction made in January.
  • Expansion is expected to accelerate slightly next year to 3.6%.


France and Germany support US 21% tax plan for corporations

  • French Finance Minister Bruno Le Maire and his German counterpart Olaf Scholz have voiced support for the proposal through a joint interview released this morning, Bloomberg reports.
  • Le Maire commented: “if the Biden administration proposes a 21% rate and there is consensus, it would be acceptable for us”
  • Scholz commented: “It is important that we agree on a percentage — where exactly that will lie, the talks in the next few weeks will determine,” “Personally I would have nothing against the U.S. proposal.”


Japan – Leading economic index was 98.7 in Februart vs 98.1 in January


Turkey – Business confidence rose to 111.0 in April vs 110.8 in March


Germany – Ifo business climate 96.8 in April vs 96.6 in March


Mexico – Economic activity %yoy in February vs -5.4% in January



Myanmar – Karen National Liberation Army seizes military outpost near Thai Boarder



US$1.2052/eur vs 1.2091/eur yesterday. Yen 107.89/$ vs 107.77/$. SAr 14.289/$ vs 14.267/$. $1.389/gbp vs $1.392/gbp. 0.774/aud vs 0.777/aud. CNY 6.492/$ vs 6.490/$.


Commodity News

Precious metals:  

Gold US$1,784/oz vs US$1,778/oz yesterday

   Gold ETFs 99.1moz vs US$99.1moz yesterday

Platinum US$1,213/oz vs US$1,239/oz yesterday

Palladium US$2,844/oz vs US$2,894/oz yesterday

Silver US$26.08/oz vs US$25.96/oz yesterday


Base metals:  

Copper US$ 9,493/t vs US$9,679/t yesterday

Aluminium US$ 2,385/t vs US$2,382/t yesterday

Nickel US$ 16,150/t vs US$16,460/t yesterday

Zinc US$ 2,805/t vs US$2,871/t yesterday

Lead US$ 2,043/t vs US$2,070/t yesterday

Tin US$ 26,940/t vs US$27,200/t yesterday



Oil US$65.9/bbl vs US$65.5/bbl yesterday

Natural Gas US$2.759/mmbtu vs US$2.714/mmbtu yesterday



Iron ore 62% Fe spot (cfr Tianjin) US$180.1/t vs US$183.3/t

Chinese steel rebar 25mm US$786.3/t vs US$803.6/t

Thermal coal (1st year forward cif ARA) US$74.3/t vs US$73.8/t

Coking coal swap Australia FOB US$146.5/t vs US$141.5/t



Cobalt LME 3m US$49,750/t vs US$49,750/t

NdPr Rare Earth Oxide (China) US$85,487/t vs US$85,523/t – Illegal rare earth mines on China border multiply since Myanmar coup

  • Illegal rare earth mining has reportedly surged in northern Katchin State on the Chinese border, in areas controlled by a junta-sponsored militia.
  • Environmental groups say mining has increased at least five times since the coup, along with a rapid influx of Chinese workers.
  • An activist told The Irrawaddy news outlet  “Before the coup, we only saw one or two trucks per day. Now there is no proper inspection we are seeing 10 to 15,”
  • “The Chinese authorities have tightened border security for imports from Myanmar due to COVID-19. But materials for the mining move across the border easily,”
  • According to Chinese customs data, China is heavily dependent on medium and heavy rare earth from Myanmar, which rose 23% YoY last year to 35,500 tonnes.
  • The head of the Transparency and Accountability Network Kachin commented: “Under the civilian government, if we complained about illegal rare earth mining, officials immediately visited and investigated. [Illegal miners] stayed away but now it is totally out of control.”
  • Heavy rare earth from Kachin State is exported to China for refining and processing and then sold around the globe (The Irrawaddy).


Lithium carbonate 99% (China) US$12,631/t vs US$12,636/t

China Spodumene Li2O 5%min CIF US$630/t vs US$630/t

Ferro-Manganese European Mn78% min US$1,621/t vs US$1,627/t

China Tungsten APT 88.5% FOB US$272/t vs US$272/t

China Graphite Flake -194 FOB US$515/t vs US$510/t


Battery News

Software trial unlocks potential for thousands on EV chargers

  • Trial in the UK has shown that more than 500 EV chargers could be connected to a single electricity substation.
  • Using AI computer simulation to automatically direct electrical capacity to safely accommodate more low carbon tech.
  • The software ‘unlocked’ 1000kW of capacity, equivalent of 142 fast chargers.
  • 195 substations across London have similarities, so there is potential for thousands of additional chargers


Foran Mining aiming for carbon neutral copper project

  • McIlvenna Bay deposit will become world’s first carbon-neutral copper development project.
  • Have been accurately recording carbon emissions and purchasing verified offsets.
  • Providing funding for several projects including a wind project in Guatemala and a forest protection project in Inner Mongolia.


Vertical turbines could be the future of wind farms

  • New research from Oxford Brookes University has found that vertical turbine design is more efficient in large scale wind farms.
  • When set in pairs, vertical turbines can increase each other’s performance by 15%.
  • 11,500 hours of simulation has shown, for the first time, vertical turbines have the potential to outcompete current horizontal axis wind farms.


Honda commits to selling only EVs by 2040

  • Plans to increase its ratio of EVs and FCVs to 100% of sales by 2040
  • Based on their expectation that EVs and FCVs will account for 40% sales by 2030 and 80% by 2035.
  • Honda is expected to invest $46.3b over the next 6 years into R&D into electrification.


Company News

Empire Metals* (AIM:EEE) 2.9p, Mkt cap £9.5m – ​Drilling restarts at Eclipse

(Empire has acquired 75% of the Eclipse project)

  • Empire Metals report the restart of drilling at the Eclipse gold project in Western Australia.
  • 200m of diamond drilling is planned to duplicate three holes to enable initial geotechnical core logging for preliminary pit design.
  • Core samples will also provide material for metallurgical testing.
  • Another 17 holes (1,700m) of RC drilling will be done at the new Jack’s Dream discovery to infill drill adjacent intersections of mineralisation and follow-up high-grade intercepts around the historic workings around the Jack’s Dream shaft.
  • A non-compliant resource at Eclipse 92,913t grading 2.25g/t containing 6,706oz of gold assuming a cut-off grade of 1.3g/t. * The data was also top-cut at 22 g/t Au.
  • We expect this small initial resource to expand substantially with further drilling at Eclipse, Jack’s Dream and along strike of the known mineralisation.
  • Empire are already working on the potential for an open pit for initial trial mining for toll treatment for early cash generation and to de-risk the project.
  • The team are already running the geotechnical work for the pit slope design assumptions and have started the required environmental study.

*SP Angel act as Nomad and Broker for Empire Metals


Bushveld Minerals* (LON:BMN) 16.50p, Mkt cap £196m – Mustang Energy Plc acquires 11% interest in Enerox GmbH through VRFB Holdings for $7.5m

(Bushveld Energy holds an indirect interest of 25.25 per cent in Enerox. Bushveld is invested in Enerox alongside a <3% in Invinity Energy Systems.)

Strong Buy 31p

  • Bushveld Energy report the investment of US$7.5m into Enerox by Mustang Energy (MUST LN).
  • Mustang are acquiring an 11.05% indirect interest in Enerox GmbH which manufacturers Vanadium Redox Flow Batteries for grid scale and micro-grid energy storage.
  • The investment is made through VRFB-H (VRFB Holdings) which holds 100% of Enerox Holdings Limited.
  •  Bushveld Energy holds an indirect interest of 25.25 per cent in Enerox through a 50.5 per cent holding in VRFB-H, which in turn holds 50 per cent of EHL an entity that wholly owns Enerox.”
  • Bushveld Energy invested $5.0m into VRFB-H on 31 March and invested another $2.7m to retain its 50.5% holding in VRFB-H.
  • Mustang’s shares have been suspended on the LSE as the transaction is considered to be a reverse takeover requiring the publication of a prospectus and readmission of Mustang to trading by no later than 31 December 2021.
  • If Mustang’s readmission does not take place by 31 December 2021 then Bushveld has agreed to issue new shares to Mustang’s noteholders in return for Mustang’s shares in VRFB-H.
  • Mustang is also paying a 5% fee to Bushveld on the Mustang Capital Raise in Mustang shares at 20p/s
  • “As previously announced on 1 April 2021, a consortium of investors in Enerox are investing US$30 million to scale up VRFB production capacity to 30MW by 2022.
  • Mustang’s investment is investing by way of an issue of $8m of unsecured convertible loan notes at a 10% interest rate.
  • VRFB-H has invested $15m so far into EHL to fund its share of the $30m investment into Enerox.

Conclusion:  Bushveld continue to draw investment into the manufacturing of Vanadium Redox Flow Battery manufacturing capacity.

Management have realised substantial gains through the sale of shares in Invinity Energy Systems reinvesting these funds into manufacturing capacity at Enerox.

We expect both companies to buy vanadium electrolyte for their VRFB systems and for this electrolyte to potentially come from Bushveld Energy’s planned plant in South Africa.

We also see South Africa as a potentially substantial market for new solar and wind power generation supported through a combination of Li-ion and VRFB battery systems.

The US Administration is looking to pass legislation seeking 80% clean energy from US power generators by 2030, a move which may create massive new demand for VRFB-grid systems.

The US Administration is looking to pass legislation seeking 80% clean energy from US power generators by 2030, a move which may create massive new demand for VRFB-grid systems.



Fortuna Silver Mines to buy Roxgold for $884m cash-and-stock deal

  • Fortuna has agreed to buy Roxgold in a C$1.1bn cash-and-stock deal in order to gain a foothold in West Africa.
  • Roxgold investors will get 0.283 of a Fortuna share plus C$0,001 in cash for each Roxgold share.
  • The deal values Roxgold at C$2.73/share, and represents a 42% premium to Roxgold’s April 23 closing price.
  • Roxgold’s West African assets include the Yaramoko mine complex in Burkina Faso and its Sefuela gold project in Cote d’Ivoire.
  • Fortuna’s share price tumbled as much as 17% on Monday.


IronRidge Resources* (AIM:IRR) 20.8p, Mkt Cap £94m – Assore supports IronRidge in £12m placing

  • IronRidge reports the placing of 60m new shares or £12m worth of new stock at 20p/s.
  • The funds are to be used to develop its Ewoyaa Lithium Project in Ghana and gold projects in the Ivory Coast and Chad.
  • The new military regime in Chad says it will not negotiate as armed rebels regroup according to The Guardian.
  • The rebels are blamed for the killing of the country’s president raising the prospect of armed rebels pressing ahead with threats to attack the capital N’djamena.

*SP Angel acts as Nomad for IronRidge Resources


Phoenix Copper* (LON:PXC) 35.75p, Mkt Cap £42m – Appointment of director and creation of advisory board

(Phoenix holds 80% of the Empire mining property in Idaho)

  • Phoenix Copper has announced the appointment of Catherine Evans, an experienced investment market professional as a non-executive director.
  • Ms Evans is described as having “over 20 years of experience in institutional investment sales in the UK, Europe, Hong Kong and South Africa. She started her career with a US brokerage firm, before joining Pictet Asset Management. Catherine then spent 10 years working in alternatives, specifically hedge funds, before joining the founding team of Fundsmith as Institutional Sales Director prior to the launch of the highly successful Fundsmith Equity Fund”.
  • In addition, the company has announced that founding director and continuing VP Investor Relations, Dennis Thomas, is relinquishing his role as a director of the company and will join the newly created two-person Advisory Board which will also include the current Chairman of Gem Diamonds, Harry Kenyon-Slaney.
  • We have also been made aware of a limited number of typographic errors in our recent research note, dated 30th March 2021, and take this opportunity to re-issue the report in a corrected form. We apologise for any confusion which arises from the previous edition but stress that the adjustments do not affect our conclusions.

Conclusion: Phoenix Copper has added an additional non-executive director to its Board and also created an advisory Board. The new Board now comprises three executive and four non-executive members, of which two are deemed independent.

*SP Angel act as Nomad for Phoenix Copper


Rambler Metals and Mining* (AIM:RMM) 0.55p, Mkt Cap £60m – 2020 annual results

(Rambler owns 100% of the Ming Copper-Gold Mine)


  • Rambler Metals & Mining reports a net loss of US$1.8m for 2020 compared with a loss, on a restated basis, of US13.5m for 2019.
  • Operations generated cash flow US$1.9m reversing the operational cash outflow of US$2.5m reported in 2019 and leaving Rambler Metals with net debt of US$3.5m at year end (2019 year end net debt of US$13.8m).
  • The result reflects the treatment of approximately 263,000t of ore at an average grade of 1.55% copper and 0.58g/t gold to produce 14,550t of concentrate containing 3,769t of saleable copper and 2,819oz of saleable gold (2019 – approximately 406,000t of ore at a grade of 1.45% copper and 0.59g/t gold generated 19,924t of concentrate containing 5,299t of saleable copper and 4,887oz of gold).
  • The company’s mining operations were not directly impacted by the Covid19 virus, however, CEO, Dr. Toby Bradbury explained that “the negative effect that the pandemic had on global markets, the copper price and the diminished availability of capital turned out to be a material issue for the Company” and, we surmise, virus containment measures also contributed to the decline in the tonnage available to be treated.
  • Refinancing, supported by West Face Capital, which occurred in February with the raising of £10m from additional equity and asset sales, positions the company to re-establish its designed 1,350tpd treatment rate and although Dr. Bradbury cautions that this task should not ne underestimated, he says that “From a standing start in the middle of December 2020, we expect it to take 9 to 12 months to achieve this recovery.  There is complete confidence that all the issues can be addressed and the true potential of the Ming Mine will be realised”.
  • Rambler Metals outlines a clear set of objectives for 2021 including the establishment of the Ming mine at “level of production that fully utilises the existing mill capacity of  1,350 tonnes per day” and targets an average feed grade of 2% copper.
  • The mine also plans to increase its mining development rates “to prepare for an increase of underground production to 2,000 tonnes per day in 2022”.
  • Additional objectives include the completion of the feasibility assessment and subsequent implementation of “an ore sorting facility at the Ming Mine site for operation in 2022” and the progression of work to relocate the Duck Pond mill to the Ming mine site including the feasibility work for “a new process and tailings storage facility in the next four to five years”.

Conclusion: Rambler Metals has laid out plans to restore processing rates to 1,350tpd during 2021 and to position the mine for an increase to 2,000tpd in 2022. Despite the constraints of the Covid19 pandemic the company moved into positive operational cash flow and was able to reduce its debt during 2020 and completed a refinancing in February. We look forward to positive developments in the months ahead as the recovery plan unfolds..

*SP Angel act as Nomad and broker to Rambler Metals & Mining 


Scotgold Resources* (AIM:SGZ) 55.5p, Mkt Cap £40m – Operational update from Cononish

Recommendation suspended. Target price being updated

  • Scotgold Resources has described its progress at the Cononish mine in Scotland where it reports that it has resolved the previously outstanding technical issues within the processing plant “which is operating consistently and currently focusing on ramping up to full design capacity expeditiously”.
  • The company reports, however, that as a result of a review of the mine plan, conducted during April, it expects the ramp-up of underground production will be slower than it had originally planned.
  • The review has concluded that “Mine development is insufficient for the mine to provide optimal ore quantity and quality in the short term, however this is not predicted to have long term impacts” although “the Company expects production for calendar year 2021 to be materially less than the guidance range previously announced on 31 March 2021”.
  • Commenting on the cash implications of the slower than expected build up to mine production Scotgold Resources says that it “is investigating financing options, including short-term debt financing from the Directors”.

Conclusion: Ramp up delays in the underground mine at Cononish are expected to deliver lower than expected gold production during 2021 without adversely affecting the long term future of the mine. The previously reported process plant issues have, however, been resolved and the plant is now operating consistently.

*SP Angel act as Nomad and broker to Scotgold Resources. A number of SP Angel analysts have visited the Cononish gold mine


Vast Resources (AIM:VAST) 0.1p, Mkt Cap £16.5m – Further progress at Baita Plai

  • Vast reports that the decline project to Level 19 is progressing on schedule and the Company has commenced mining fresh higher grade ore at its Baita Plai Polymetallic Mine in Romania, in accordance with the revised mechanised mine plan as announcened on 30th March 2021.
  • Mining and concentrate production has and will continue uninterrupted during this development phase at Baita Plai, with underground production currently focused on Levels 17 & 18 in addition to the new mining area on Level 19.
  • Exploration drilling targeting the downdip extension of the Antonio skarn from 19 level to 22 level is expected to commence in June 2021.
  • Andrew Prelea, Chief Executive Officer of Vast Resources Plc, commented: “I am delighted with the operational progress that we have made in recent weeks and we remain well capitalised to achieve our development plan at Baita Plai without needing to come back to the market for the foreseeable future.  We will look to provide further updates from Baita Plai via our social media platforms and via the regulatory news channels as appropriate over the coming days and weeks.”


No.1 in Copper:  “The winner of the 2020 Fastmarkets Apex contest for copper was the team at SP Angel comprising John Meyer, Sergey Raevskiy and Simon Beardsmore, with an  accuracy score of 93.8%”

No1. In Gold:  “SP Angel’s trio took the top spot for the gold price prediction throughout the year, with an accuracy score of 97.59%”

The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020



John Meyer – [email protected] – 0203 470 0490

Simon Beardsmore – [email protected] – 0203 470 0484

Sergey Raevskiy –[email protected] – 0203 470 0474

Joe Rowbottom – [email protected] – 0203 470 0486



Richard Parlons –[email protected] – 0203 470 0472

Abigail Wayne – [email protected] – 0203 470 0534

Rob Rees – [email protected] – 0203 470 0535

Grant Barker – [email protected] – 0203 470 0471



SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London



*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)

+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.


Sources of commodity prices

Gold, Platinum, Palladium, Silver – BGNL (Bloomberg Generic Composite rate, London)

Gold ETFs, Steel – Bloomberg

Copper, Aluminium, Nickel, Zinc, Lead, Tin, Cobalt – LME

Oil Brent – ICE

Natural Gas, Uranium, Iron Ore – NYMEX

Thermal Coal – Bloomberg OTC Composite

Coking Coal – SSY

RRE – Steelhome

Lithium Carbonate, Ferro Vanadium, Tungsten, Spodumene, Ferro-Manganese, Graphite – Asian Metal



This note is a marketing communication and comprises non-independent research. This means it has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of its dissemination.

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SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return of less than 15%

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