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ADN - Andromeda Metals
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Jack Aubrey
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Entered for the October 2019 tipping comp.
Getting a bit of a hammering by profit takers on September 30 and Oct 1 after release of the Scoping Study for their Poochera Kaolin-Halloysite deposit, but the SS shows an outstanding resource and a very quick path to production and revenue. ADN also has gold resources and is well set up to fund the development of a first stage extraction project without further CR. I have this as long-term (1-2 yrs) hold but short-term market sentiment may change to very positive once current fog clears.
Getting a bit of a hammering by profit takers on September 30 and Oct 1 after release of the Scoping Study for their Poochera Kaolin-Halloysite deposit, but the SS shows an outstanding resource and a very quick path to production and revenue. ADN also has gold resources and is well set up to fund the development of a first stage extraction project without further CR. I have this as long-term (1-2 yrs) hold but short-term market sentiment may change to very positive once current fog clears.
Jack Aubrey
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Despite being thumped in October (a tiny unexpected CR and silly games), I'm tipping ADN again for November in the hope of an announcement on binding offtakes (or anything really) that will put a new rocket under the SP. I'm over weight in this stock so this is now personal.
Jack Aubrey
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I haven't been following ADN as long as others here, but I do hold and thought I'd update. All of this fundy info comes from the company website, particular their recent ANNs, including the Scoping Study released on 30 September.
As you can see from the earlier posts in this thread, ADN was a gold and copper explorer (under the name Adelaide Resources) before it switched its main focus to their Kaolin (clay) deposits on the Eyre Pennisular. They still hold most of their original gold and copper permits and are currently in the process of expanding the JORC resource estimate for the kaolin deposit at Poochera ("Carey's Well") ( and some satellite deposits they hold called Camel Lake and Tomney East.) The Poochera operation is a JV with Minotaur Exploration (ASX:MEP) but ADN is running the show and has the option to buy out the MEP stake in the future..
ADN has recently done a (small) Capital Raising to fund a Feasibility Study and environmental work. Their stated ambition is to bring Carey's Well into production within two years. This is a very low capex project (<$20M?)and the recent CR and options (Nov 2020 with a strike price of 1.2 cents) is believed to be sufficient to get the project into into production. The "mine" is very simple - little overburden, no blasting, just scoop up the clay, sift out the sand and send it to the local port for export. There's at east 30 years of production of this kaolin from the Carey's Well deposit alone and that will almost certainly be expanded with the reassessment currently underway.
So why has this got (some) people excited?
Clays ain't clays. Firstly, Kaolin is an aluminium-silicate clay and, in higher, whiter, grades, is the main feedstock for the fine and industrial porcelain industry. ADN's kaolin is of the highest, whitest, grade. Certain types of kaolin are also used in paper manufacture and as additives to paint. ADN's kaolin fits the bill. Traditional high quality kaolin producers have largely either exhausted their supply (after >2000 years of production, this is probably inevitable) or are being closed for environmental/planning reasons as Chinese cities expand. ADN is in discussion with at least 20 end-users in China, Japan and Europe, and has non-binding off-take letters from several of them. Export grade kaolin sells for around $300 per tonne.
Moreover, these high quality kaolin clays contain a proportion of the makings for HPA (High Purity Aluminium) - for which there is an expanding market, especially in the battery market. Different grades (purity) of HPA feedstock sell at different prices. ADN believes it can get to Grade 4 in one processing cycle. That sells for USD3,000 per tonne.
Wait, there's more!. The HPA component in ADN's Poochera deposits has been tested to be present mainly as Halloysite - a tubular "nano structure" form that, apart from being highly suitable as the basis for HPA production, has the scientific world particularly excited as a POSSIBLE basis for everything from slow-release cancer drugs, hydrogen storage, molecular seives and even CO2 recovery. The Halloysite in ADN's kaolin ranges up to 30%. As far as I can tell, the market for pure Halloysite right now is pretty small, being mainly used as lab product and for some catalysts.
ADN’s pivot to Kaolin/Halloysite coincided with the appointment of James Marsh as MD. He has thirty years experience in this industry and is seen by many people as the key to ADN’s potential. ADN recently confirmed a research partnership with the University of Newcastle on uses of Halloysite in Hydrogen storage. The Federal Government chipped in $100,000 for this research (I guess nobody told them that renewables were involved).
ADN currently has a market cap $60.6M and is trading at around 4.3 cents PS (after closing at 7.5 cents a few weeks ago). It was at 0.5 cents on 1 May this year, giving canny long-term holders a nice 15x value increase if they sold at the peak.
As I see it, the positives about this stock are:
ASX:ATC $93m MC HPA from Kaolin plant construction
ASX:A4N ~$84m MC HPA from industrial waste Pilot Plant construction
ASX:KRR ~ $39m MC
ASX:AXE ~$26m MC Halloysite + lots of other interesting prospects
ASX:MSE ~$16m MC
ASX:FYI ~$15m MC
ASX:MEP ~ $18m MC diverse mineral exposure to ADN via JV
It is worth looking at the stories of these companies, especially regarding the size and quality of their resource, their path to production and how they see their markets.
There are few other micro cap plays currently singing from the HPA songsheet.
I don’t know (of course) if the current ADN price represents a short- or medium- term trading opportunity or whether this is just one to watch for 2020/21. I’m in up to my armpits. This is certainly not investment advice.
Strangely, there do seem to be a couple of knowledgeable posters on the HC ADN threads (as well as the usual P&D crowd and 100+ opinionated nobodies who know more than company management). I’m sure you’ll easily work out which is which.
Happy to be corrected on any of the above and to hear others’ views about ADN or the Kaolin/HPA/Halloysite field in general.
As you can see from the earlier posts in this thread, ADN was a gold and copper explorer (under the name Adelaide Resources) before it switched its main focus to their Kaolin (clay) deposits on the Eyre Pennisular. They still hold most of their original gold and copper permits and are currently in the process of expanding the JORC resource estimate for the kaolin deposit at Poochera ("Carey's Well") ( and some satellite deposits they hold called Camel Lake and Tomney East.) The Poochera operation is a JV with Minotaur Exploration (ASX:MEP) but ADN is running the show and has the option to buy out the MEP stake in the future..
ADN has recently done a (small) Capital Raising to fund a Feasibility Study and environmental work. Their stated ambition is to bring Carey's Well into production within two years. This is a very low capex project (<$20M?)and the recent CR and options (Nov 2020 with a strike price of 1.2 cents) is believed to be sufficient to get the project into into production. The "mine" is very simple - little overburden, no blasting, just scoop up the clay, sift out the sand and send it to the local port for export. There's at east 30 years of production of this kaolin from the Carey's Well deposit alone and that will almost certainly be expanded with the reassessment currently underway.
So why has this got (some) people excited?
Clays ain't clays. Firstly, Kaolin is an aluminium-silicate clay and, in higher, whiter, grades, is the main feedstock for the fine and industrial porcelain industry. ADN's kaolin is of the highest, whitest, grade. Certain types of kaolin are also used in paper manufacture and as additives to paint. ADN's kaolin fits the bill. Traditional high quality kaolin producers have largely either exhausted their supply (after >2000 years of production, this is probably inevitable) or are being closed for environmental/planning reasons as Chinese cities expand. ADN is in discussion with at least 20 end-users in China, Japan and Europe, and has non-binding off-take letters from several of them. Export grade kaolin sells for around $300 per tonne.
Moreover, these high quality kaolin clays contain a proportion of the makings for HPA (High Purity Aluminium) - for which there is an expanding market, especially in the battery market. Different grades (purity) of HPA feedstock sell at different prices. ADN believes it can get to Grade 4 in one processing cycle. That sells for USD3,000 per tonne.
Wait, there's more!. The HPA component in ADN's Poochera deposits has been tested to be present mainly as Halloysite - a tubular "nano structure" form that, apart from being highly suitable as the basis for HPA production, has the scientific world particularly excited as a POSSIBLE basis for everything from slow-release cancer drugs, hydrogen storage, molecular seives and even CO2 recovery. The Halloysite in ADN's kaolin ranges up to 30%. As far as I can tell, the market for pure Halloysite right now is pretty small, being mainly used as lab product and for some catalysts.
ADN’s pivot to Kaolin/Halloysite coincided with the appointment of James Marsh as MD. He has thirty years experience in this industry and is seen by many people as the key to ADN’s potential. ADN recently confirmed a research partnership with the University of Newcastle on uses of Halloysite in Hydrogen storage. The Federal Government chipped in $100,000 for this research (I guess nobody told them that renewables were involved).
ADN currently has a market cap $60.6M and is trading at around 4.3 cents PS (after closing at 7.5 cents a few weeks ago). It was at 0.5 cents on 1 May this year, giving canny long-term holders a nice 15x value increase if they sold at the peak.
As I see it, the positives about this stock are:
- extremely high grade resource with huge volume – possibly “the best in the world”
- very low capex requirement and quick timeline to reach production of first stage kaolin for export
- highly respected management with good contacts in the market/s
- potential for different products into different markets, some of them booming (batteries) and some blue-sky (Halloysite nano tubes)
- other (copper and gold) assets – maybe as backup assets for financing processing if things go boom?
- supportive (SA State) government which sees potential for allied business and regional development.
- no binding offtakes (yet)
- as a small-cap mining stock, with recent buy-in from “sophs”, it is subject to “funny business” (I would not allege share price manipulation, oh no) and the price does react strangely to news (it fell on the release of a very positive SS and a small cap raise -12% dilution - recently).
- at some stage the JV partnership will need to be resolved (buy out?) with the possible need for more cash
- The DFS and environmental approvals, as well as resource enlargement, are still in progress
ASX:ATC $93m MC HPA from Kaolin plant construction
ASX:A4N ~$84m MC HPA from industrial waste Pilot Plant construction
ASX:KRR ~ $39m MC
ASX:AXE ~$26m MC Halloysite + lots of other interesting prospects
ASX:MSE ~$16m MC
ASX:FYI ~$15m MC
ASX:MEP ~ $18m MC diverse mineral exposure to ADN via JV
It is worth looking at the stories of these companies, especially regarding the size and quality of their resource, their path to production and how they see their markets.
There are few other micro cap plays currently singing from the HPA songsheet.
I don’t know (of course) if the current ADN price represents a short- or medium- term trading opportunity or whether this is just one to watch for 2020/21. I’m in up to my armpits. This is certainly not investment advice.
Strangely, there do seem to be a couple of knowledgeable posters on the HC ADN threads (as well as the usual P&D crowd and 100+ opinionated nobodies who know more than company management). I’m sure you’ll easily work out which is which.
Happy to be corrected on any of the above and to hear others’ views about ADN or the Kaolin/HPA/Halloysite field in general.
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Hi All, new on here, I have a few ADN ... hope it's ok to leave this here, James Marsh interview :
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Jack Aubrey
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Hi Slim - ADN has a unique story (and a great leader in James Marsh) as well as some quite remarkable financial projections (an IRR of >150% according to the SS). Just be warned that, like all "penny stocks", the share price can be quite volatile and can respond counter-intuitively to good news. It may be a bumpy ride at times (although the past few days have been thrilling). My guess (and it is a guess) is that once substantial offtake agreements are signed, things may move quite quickly and FOMO (Fear Of Missing Out) may drive unsustainably rapid rises that will certainly be followed by corrections due to profit taking.
Good luck!
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ADN & 'unique' certainly go together IMO, I have been in well over a year, started at 0.5c & now average 1c. Great interview in the above post, JM is the man for the job & with the very high quality deposit (which is rare) 'clay' halloysite etc I am very confident & happy to leave in the bottom draw for a while. The ASX will behave as it does down at this end of the market inc ups & downs for other reasons, traders, profit taking etc. Interesting times ahead, all just my own humble opinion for what it's worth.
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Good one Slim.
I also have my eyes on a new halloysite kaolin prospect.
Keeping me cards cLose to me chest at the moment Regarding the name of the highly Speculative stock.
F.Rock
I also have my eyes on a new halloysite kaolin prospect.
Keeping me cards cLose to me chest at the moment Regarding the name of the highly Speculative stock.
F.Rock
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Good luck with whoever it is, I'll stick with ADN, my retirement planGood one Slim.
I also have my eyes on a new halloysite kaolin prospect.
Keeping me cards cLose to me chest at the moment Regarding the name of the highly Speculative stock.
F.Rock
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Great information thank you, one of my better performers in over 50 years. but what would I know?
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As for ADN, my nominated selection for the Feb comp. I look at the chart now and ask why did I select it?
Weekly Chart: What has happened and what's happening now?
It's hard to miss the massive impulsive move from 0.01 to 0.08. That's the main feature. Price has fallen as lots of temporary holders (traders) sold to take profits. +700% who wouldn't have sold some to lock in some profit. Since then price has gone sideways. Interestingly, this sideways range sits on the 50% level of the prior big swing up. The green box marks the 50 - 62% buy zone.
From the weekly chart the next BO-HR is >0.057
Daily Chart: Shows the rising lows quite nicely. This looks like more accumulation at these levels. Towards the end of Jan there was a daily rally that hit the old high at 0.057 and at the EOM price was back at the 50% level (buy zone) of this small daily rally.
So I thought ADN would be a good candidate for the Feb comp. I hope it holds this level for a few days before powering higher and eventually breaking through the RL at 0.057. If price closes below 0.04 then my hopes are dashed. Or are they? Perhaps some sneaky insto trader will push prices below 0.04 and buy all the retail stop loss sell orders before letting the price go up. I'll be watching.
Weekly Chart: What has happened and what's happening now?
It's hard to miss the massive impulsive move from 0.01 to 0.08. That's the main feature. Price has fallen as lots of temporary holders (traders) sold to take profits. +700% who wouldn't have sold some to lock in some profit. Since then price has gone sideways. Interestingly, this sideways range sits on the 50% level of the prior big swing up. The green box marks the 50 - 62% buy zone.
From the weekly chart the next BO-HR is >0.057
Daily Chart: Shows the rising lows quite nicely. This looks like more accumulation at these levels. Towards the end of Jan there was a daily rally that hit the old high at 0.057 and at the EOM price was back at the 50% level (buy zone) of this small daily rally.
So I thought ADN would be a good candidate for the Feb comp. I hope it holds this level for a few days before powering higher and eventually breaking through the RL at 0.057. If price closes below 0.04 then my hopes are dashed. Or are they? Perhaps some sneaky insto trader will push prices below 0.04 and buy all the retail stop loss sell orders before letting the price go up. I'll be watching.
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ADN's price is holding up well in the latest market selloff. Needs some news to get moving higher again. My pick for the Mar20 monthly comp.
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Coffee with Samso Part 2 :
:
tinhat
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Another Samso interview
Those unfamiliar with Samso, he is a fashion guru!
Those unfamiliar with Samso, he is a fashion guru!
Dona Ferentes
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and another one:
Andromeda Metals Limited is an emerging industrial minerals company listed on the Australian Securities Exchange with a vision of becoming the world’s leading supplier of high-grade halloysite-kaolin.
- Andromeda Metals is a low capex, short payback period, large scale potential Halloysite- Kaolin miner
- You already use Kaolin in a vast number of applications, every day
- Global supply of high-quality halloysite-kaolin is reducing
- Andromeda will be the largest supplier of Halloysite-Kaolin and nanotechnology materials in the world
❑ Various levels of halloysite % products from the Great White and Hammerhead deposits being tested in a range of construction products
❑ Addition levels as low as 1kg/m3 of concrete show clear positive benefits in handling and strength
www.sharecafe.com.au
Andromeda Metals Limited is an emerging industrial minerals company listed on the Australian Securities Exchange with a vision of becoming the world’s leading supplier of high-grade halloysite-kaolin.
- Andromeda Metals is a low capex, short payback period, large scale potential Halloysite- Kaolin miner
- You already use Kaolin in a vast number of applications, every day
- Global supply of high-quality halloysite-kaolin is reducing
- Andromeda will be the largest supplier of Halloysite-Kaolin and nanotechnology materials in the world
❑ Various levels of halloysite % products from the Great White and Hammerhead deposits being tested in a range of construction products
❑ Addition levels as low as 1kg/m3 of concrete show clear positive benefits in handling and strength
Andromeda Metals - Hidden Gems Webinar Presentation - ShareCafe
Presenter – James Marsh – MD – Andromeda Metals Limited is an emerging industrial minerals company listed on the Australian Securities Exchange with a vision of becoming the world's leading supplier of high-grade halloysite-kaolin.
tinhat
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Stock price is doing well. At some time it will be due for a pull-back. That might be tomorrow or a couple of weeks. Plenty of opportunity to enter I would think. DYOR.
Jack Aubrey
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A well timed post @tinhat. ADN went into a trading halt late today pending the release of an indicative Mineral Resource for the Hammerhead Kaolin Prospect. It will be interesting to see whether there is a retrace/sell off after a (probably very positive) announcement as happened several times last FY or whether the market greets it the same way as the Poochera resource upgrade and the recent cement additive announcement. I'd personally welcome a bit of a retrace but am beginning to think we are in the process of a genuine re-rate. The volumes involved over the past two weeks have been well above average and some large parcels have gone through. I can't complain as I threw the kitchen sink at this one last year and only have a few washers and tap fittings left.
Dona Ferentes
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good plug . Hope it doesn't go down the drain.... I can't complain as I threw the kitchen sink at this one last year and only have a few washers and tap fittings left.
