Eurasia Mining* (LON:EUA) 23.12p, Mkt Cap £660m – Update on hydrogen/ammonia strategy and new presentation
(NKT is held within TGK, Eurasia’s 80% owned subsidiary operating in Kola, Russia)
Eurasia Mining have today published an update on their hydrogen and ammonia strategy.
SP Angel . Morning View . Thursday 30 12 21
Lithium carbonate breaks over US$40,000/t in China
Australian Vanadium (Australian Vanadium Ltd (ASX:AVL)) – Subsidiary to build VRFB at Water corporation site
Boliden AB (LON:BOL) – Nickel production halted at Harjavalta due to explosion
Eurasia Mining* (Eurasia Mining PLC (AIM:EUA)) – Update on hydrogen/ammonia strategy and new presentation
Lynas Rare Earths (Lynas Corporation (ASX:LYC)) – Environmental approval for Malaysian disposal facility
Sandfire Resources (Sandfire Resources NL (ASX:SFR)) – Spanish government grants Sandfire Resources approval for MATSA acquisition
IGTV: IG Outlook 2022, 23/12/21:: https://youtu.be/4w7nbjRdFyk
interactive Investors: FTSE 100 favourite stock: https://youtu.be/BomNRQJt-YA
2022 outlook: https://youtu.be/SxMPiPEc_Rg
Three small-cap mining share tips for 2022: https://www.youtube.com/watch?v=9xvA_3UXXYQ&ab_channel=interactiveinvestor
VOX Markets: 08/12/21: https://audioboom.com/posts/7993202- china-economy-plus-bluejay-centamin-cornish-metals
*SP Angel almost invariably acts as nomad or broker or nomad and broker to companies mentioned in the above videos and podcasts.
We speak more about these companies as we have a good understanding of their business and can talk with a greater degree of confidence. As ever, however, it should be noted that our views do not take into account the circumstances and needs of any particular investor or investor type. So enjoy the talks, but please do your own research, including other companies not mentioned by us but operating in the same areas, and get professional advice where appropriate.
Dow Jones Industrials +0.25% at 36,489
Nikkei 225 -0.40% at 28,792
HK Hang Seng +0.07% at 23,102
Shanghai Composite +0.62% at 3,619
Economics
China – Beijing announces plans to boost consumption rebound, foreign trade and investment growth in 2022
China’s Ministry of Commerce announced plans to shore up the country’s economy in 2022.
This will entail ensuring ‘consistency in policies while unleashing new policy measures combining cross-cyclical and countercyclical adjustments.’ (People’s Daily)
Focus will be on small/medium-sized enterprises alongside securing the domestic market and supply chain.
High-quality development will be pushed alongside expanding China’s domestic market, including domestic brands.
Evergrande misses new coupon payment despite ‘explosive growth’ in property deliveries
Bondholders have reported no sign of payment on $255m worth of Evergrande coupons due yesterday. (Reuters)
Shares in Evergrande fell an additional 9.7% having climbed after the chairman announced plans to deliver 39k units in December vs 10k in each of Sept, Oct, Nov.
The company announced it is seeing ‘explosive growth’ in property deliveries this week.
Evergrande claims in has delivered 6,022 apartments across 5 secondary cities since Dec. 7th.
The company stated this morning that 91.7% of its projects have resumed construction.
Beijing has stepped up fiscal efforts to support the ailing developers, with the PBOC encouraging banks to grant M&A loans to the sector to boost the financing environment.
US/China – US secretary of State urges China to stop targeting Hong Kong journalists
US Sec. of State Antony Blinken urged Chinese authorities a day after the biggest remaining pro-democracy news organisation was shut down.
More than 200 police raided Stand News’s newsroom and froze $7.8m of assets and arrested people.
Blinken said in a statement: “cease targeting Hong Kong’s free and independent media and to immediately release those journalists and media executives who have been unjustly detained and charged”
US sees record number of new Covid cases as Omicron variant surges
The US saw a pandemic record of 265,427 cases on Tuesday, (Johns Hopkins University/WSJ)
Cases increased by 60% this week.
The 7-day avergage of hospitalizations hit 77,840 – up 14% over the past fortnight.
ICU units are reporting short-staffing issues with employees falling ill, forcing some to close.
UK – Expect ongoing logistic and other disruption as the UK reports a rise of 53,000 Covid cases to a new record at 183,037 today
The level of Covid sickness has risen 41.4% over the past seven days (Reuters).
The British government is allowing New Years celebrations to continue.
The policy is likely to see much higher levels of infection into the new year.
Reports indicate that up to 90% of intensive care Covid patients have not received a booster vaccine.
We expect increasing disruption to travel and logistics as staff self-isolate or take time to recover from Covid.
UK – House prices rise at fastest pace since 2006 this year
Prices rose at an annual rate of 10.4% in December, making the calendar year performance the strongest since 2006, according to Nationwide.
The price of a typical UK home rose to a record high of £254,822, up £23,902 over the year, the largest rise recorded in a single year in cash terms.
Zambia – inflation falls to 14-month low (Bloomberg)
Food price inflation in Zamia fell to a 13-month low of 19.9% in December vs 25.4% yoy in November.
Non-food inflation fell to 12.1% from 12.2%.
Indonesia – China Nonferrous Metal wins $354m copper smelting contract
China nonferrous has won a contract to build facilities for a copper smelting plant in Indonesia, the company reports.
The company will construct a water intake facility and other related facilities for PT Amman Mineral International’s planned smelter with an estimated annual processing capacity of 900kt of copper concentrate.
Peru – Las Bambas dispute remains far from agreement, government source admits
A community advisor and government source have told Reuters a deal at MMG’s Las Bambas mine with protestors is still far away.
The Chumbivilcas has blocked a key copper transport route for over a month.
Las Bambas shut production on 18th December at the mine which supplies 2% of the world’s copper and 1% of Peru’s GDP.
The government are expected to reveal proposal details today.
Russian government body suspects MMK, NLMK and Severstal to have broken antimonopoly laws
The Russian Federal Antimonopoly Service (FAS) ruled that Magnitogorsk Iron and Steel Works (MMK), Novolipetsk Steel (NLMK) and Severstal had broken antimonopoly laws.
The 3 companies are accused of setting and maintaining ‘monopolistic’ prices for hot-rolled flat products in Russia’s domestic market.
The defendants have been asked to submit evidence and arguments in explanation.
MMK’s revenue has increased 86.5% this year, NLMK’s revenue up 69%, Severstal’s revenue up 63%.
The three companies dominate Russia’s ferrous metallurgy industry.
Currencies
US$1.1310/eur vs 1.1287/eur yesterday. Yen 115.16/$ vs 114.96/$. SAr 15.960/$ vs 15.744/$. $1.347/gbp vs $1.342/gbp. 0.726/aud vs 0.723/aud. CNY 6.373/$ vs 6.372/$.
Commodity News
Precious metals:
Gold US$1,800/oz vs US$1,803/oz yesterday
Gold ETFs 97.8moz vs US$97.7moz yesterday
Platinum US$969/oz vs US$972/oz yesterday
Palladium US$1,963/oz vs US$1,985/oz yesterday
Silver US$22.67/oz vs US$23.12/oz yesterday
Rhodium US$14,100/oz vs US$14,100/oz yesterday
Base metals:
Copper US$ 9,675/t vs US$9,668/t yesterday
Aluminium US$ 2,820/t vs US$2,813/t yesterday
Nickel US$ 20,450/t vs US$20,230/t yesterday
Zinc US$ 3,516/t vs US$3,502/t yesterday
Lead US$ 2,295/t vs US$2,291/t yesterday
Tin US$ 39,030/t vs US$39,200/t yesterday
Energy:
Oil US$79.0/bbl vs US$79.4/bbl yesterday
Natural Gas US$3.906/mmbtu vs US$4.166/mmbtu yesterday
Uranium UXC US$43.70/lb vs $43.95/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$119.5/t vs US$118.3/t
Chinese steel rebar 25mm US$741.6/t vs US$743.8/t
Thermal coal (1st year forward cif ARA) US$123.0/t vs US$123.0/tThermal coal swap Australia FOB US$156.8/t vs US$171.5/t
Coking coal swap Australia FOB US$352.0/t vs US$352.0/t
Other:
Cobalt LME 3m US$70,500/t vs US$70,500/t
NdPr Rare Earth Oxide (China) US$132,039/t vs US$131,443/t
Lithium carbonate 99% (China) US$40,404/t vs US$39,629/t
China Spodumene Li2O 5%min CIF US$2,560/t vs US$2,510/t
Ferro-Manganese European Mn78% min US$1,804/t vs US$1,800/t
China Tungsten APT 88.5% FOB US$315/t vs US$315/t
China Graphite Flake -194 FOB US$805/t vs US$805/t
Europe Vanadium Pentoxide 98% 8.7/lb vs US$8.7/lb
Europe Ferro-Vanadium 80% 32.75/kg vs US$32.75/kg
China Ilmenite Concentrate TiO2 US$384/t vs US$384/t
Spot CO2 Emissions EUA Price US$83.3/t vs US$83.1/t
Battery News
Northvolt produces Europe’s first Lithium-Ion battery cell
Northvolt has developed its first lithium-ion battery cell at its new Gigafactory in Sweden.
The company plans to ship Li-ion cells to EV manufacturers next year under $30bn of contracts with European customers including BMW, VW and Volvo.
VW has a 20% stake in Northvolt and ordered $14bn worth of batteries for the next decade.
Northvolt will need to ensure rigorous manufacturing and raw material quality to ensure its Li-ion cells are safe and robust for automotive use.
Company News
Australian Vanadium (Australian Vanadium Ltd (ASX:AVL)) A$0.03, A$98m – Subsidiary to build VRFB at Water corporation site
Australian Vanadium (AVL) has announced that its wholly owned subsidiary VSUN Energy will build a 5kW/30kWh vanadium redox flow battery for trial usage at Water Corporation’s innovation hub in Shenton Park, Western Australia.
Water Corporation is owned by the Western Australian Government and is the state’s primary provider of water, wastewater, drainage, and bulk irrigation services.
Vanadium flow batteries consist of two tanks of liquid, which simply sit there until needed. The two solutions flow adjacent to each other past a membrane, and this type of battery can offer almost unlimited energy capacity simply by using larger electrolyte storage tanks. It can be left completely discharged for long periods with no ill effects, making maintenance simpler than other batteries.
V-flow batteries outcompete Li-ion, and any other solid battery, for utility-scale applications. They’re just safer, more scalable, longer-lasting and cheaper – less than half the cost per kWh.
The VRFB will first be tested on a transportable water purification unit, supplying 100% renewable power to the system through a solar PV and VRFB standalone power system.
VSUN Energy will collaborate with Water Corporation to test, gather data, and give appropriate solutions for potential future use cases for VRFBs across Water Corporation’s activities.
AVL comment that VRFB could be used to aid pumping applications and for supplying power to remote off-grid energy loads, currently powered by diesel generators.
Water Corporation will get the battery free of charge for the period of the trial, with the option to purchase at Water Corporation’s choice.
Boliden AB (LON:BOL) 353SEK, Mkt Cap 96.5bn SEK – Nickel production halted at Harjavalta due to explosion
Boliden reports that nickel production at the Harjavalta smelter has been stopped due to a slag explosion that was the result of a process malfunction in the nickel electric furnace slag tapping system on December 24.
The smelter is the only nickel smelter in Western Europe, producing nickel matte while having amongst the lowest sulphur dioxide emissions per produced tonne of nickel compared to other nickel smelters around the world.
In 2020, the smelter produced 146kt of copper and 25kt of nickel.
Nobody was injured as a result of the explosion, and the main damage was to the mechanical construction and the slag tapping system.
Production in the nickel line has been stopped and is estimated to be offline until mid-January.
Current estimates on the impact on EBIT due to the lost production and repair costs is 100M SEK (~£8.2m).
Eurasia Mining* (Eurasia Mining PLC (AIM:EUA)) 23.12p, Mkt Cap £660m – Update on hydrogen/ammonia strategy and new presentation
(NKT is held within TGK, Eurasia’s 80% owned subsidiary operating in Kola, Russia)
Eurasia Mining have today published an update on their hydrogen and ammonia strategy.
The strategy update follows on from the opening of Eurasia’s Japan office and the appointment of director Tamerlan Abdikeev.
Eurasia reports it has identified opportunities in hydrogen/ammonia production to complement its platinum group metals mining business in Russia.
The production of hydrogen / ammonia offers significant potential synergies for the mining business through the use of hydrogen to run equipment and low cost power which is available in the Kola region.
Eurasia has signed an agreement with H4Energy a Russian engineering and development company which specialises in hydrogen and ammonia projects in relation to establishing a joint venture with to develop hydrogen / ammonia projects in Kola and Sakhalin.
“Support for the development of the Projects on the Federal level secured from the Deputy Prime Minister of Russia / Presidential Envoy to the Far Eastern Federal District”
“Pre-investment feasibility study reports prepared for Eurasia and H4Energy and reviewed by independent technical experts, including financial models and sensitivity analyses”
“Agreement signed with State Far East and Arctic Development Corporation (ERDC) to assist with the procurement of land and energy supplies in relation to both the Kola and Sakhalin hydrogen / ammonia projects”
Eurasia and H4Energy are in the process of negotiating energy supply agreements with regional energy suppliers with “several off-take agreements being discussed including own use of hydrogen for the Company’s mining equipment for the Kola operations”
“Project finance plan being developed further to ongoing discussions with Asian investors.”
Further details are available in the company presentation on their hydrogen strategy posted today.
Slide 8 highlights the key points achieved so far in Eurasia’s green hydrogen and ammonia strategy.
https://www.eurasiamining.co.uk/investors/presentations
Conclusion: Eurasia appears to be utilising its contacts and presence in the Kola region of Russia to gain options on land and low-cost hydro power ($0.0/kwh) with ~1GW of spare capacity for the generation of hydrogen and ammonia in the region. The joint venture partner includes a team of ex Shell hydrogen professionals. The potential sites benefit from access to the port of Murmansk for the shipment of hydrogen to the West.
*SP Angel act as Nomad and Broker to Eurasia Mining
Lynas Rare Earths (Lynas Corporation (ASX:LYC)) A$10.3, Mkt cap A$9.3bn – Environmental approval for Malaysian disposal facility
Lynas has received environmental approval form Malaysia on its permanent disposal facility for water leach purification, the company reports.
The miner says it has completed detailed assessments for the disposal of low-level radioactive waste from Lynas’ Malaysia plant.
The issue of waste disposal has been a sticking point for the project and identifying a location for the permanent disposal facility was part of the requirements set by the country’s government when it renewed the company’s licence to operate in Malaysia early last year.
Sandfire Resources Ltd, SFR AU, A$6.65, Mkt Cap A$2.73bn – Spanish government grants Sandfire Resources approval for MATSA acquisition
Sandfire’s US$1.86bn acquisition proposal for the MATSA mining complex in Spain has been approved by the Spanish government.
The company expects the transaction to be completed on or around Jan. 31st, 2022.
MATSA is a large-scale underground copper asset hosting 3 underground mining operations.
The complex feeds into a 4.7mt pa central processing facility.
Sandfire expects the combination of MATSA with its DeGrussa Operation to produce 194kt of copper equivalent in FY2022.
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The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020
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