ALM - Alma Metals

[greggles]

African Energy Resources searching for copper in the East Kimberley after applying for nine exploration licenses.

This announcement comes only days after AFR announced that it had inked an exclusive option with Cantebury Resources Limited (CBY) to earn up to a 70% interest in the Briggs, Mannersley and Fig Tree Hill Porphyry Copper Project in south-east Queensland.

AFR appear to be re-inventing themselves as a domestic copper explorer. Given the price of copper recently, it's not a bad strategic move and the share price has been been steadily moving north this month.

 

[System]

On December 8th, 2021, African Energy Resources Limited (AFR) changed its name and ASX code to Alma Metals Limited (ALM).

 

[The Triangle]

My favorite market guilty pleasure is investing (gambling) on a junior explorer who has started exploration drilling somewhere. You know within a few weeks/months you'll get news of drill results and they'll be pumped up to be fantastic no matter what the result. 0.01% nickel will be called massive sulphides. 1g/t gold will be called bonanza grades and so on... It pisses me off when I don't hold the shares, but when I do I love it.

Alma is currently drilling a very large very low-grade copper deposit in QLD.

The executive chairman was/is also involved with CVV which shot up very quickly on drilling out a very big very low-grade WA copper deposit, so I suspect he's trying the same thing here. Copper is not popular at the moment, but if this drilling campaign manages to prove up anything resembling a high-grade 'starter' pit (which is what the likes of HCH have been trying to do for years) then this could be a very interesting junior. 0.3% copper is simply not enough to make things happen, even at a billion tonnes. But if you can get a 0.7% section to last 3-4 years, pay off the capex then all of a sudden you have 10-20 years of low grade dirt to pump out a tidy predictable profit.

They've recently done a capital raise at 1 cent and I suspect should still have a million in the bank by EOQ2, certainly not a great position, but with limited debt (100k in liabilities) and only a $10m market cap a fair bit of risk is already priced in. The question is if they manage to get some good drill results is ALM or CBY the better investment as the "Briggs porphyry" is owned by CBY who are farming it out to ALM. Below is from the CBY quarterly (have no cash and a MC of $5m).

 

[greggles]

Some encouraging drilling results coming out of the Briggs Copper Project in Queensland. Drilling is continuing with assays from the second hole (22BRD0014) due early this quarter. With a market cap of ~$12 million some very good results could see ALM move north fast.