African Battery Metals (AIM:ABM), which rebranded from Sula Iron & Gold last month, has identified a number of possible sites of mineralisation at its recently acquired cobalt-copper interests in the Democratic Republic of the Congo. In an update for the cobalt exploration program at its recently acquired Kisinka licence, ABM said a satellite imagery remote sensing report had identified a the targets. The firm is now following these up with ground exploration activities and has commissioned an auger drilling programme. Augering is a fast, efficient and highly cost-effective means of extracting material from up to 20 metres below the surface.
ABM added that it had observed a number of clearings in dense vegetation, widely used in mineral exploration as they are a sign of soil contamination caused by base metal mineralisation. The targets form an early step in the company’s recent efforts to transition away from the gold market and into the battery metals space, with a particular focus on cobalt. ABM believes cobalt will provide the tightest supply/demand fundamentals of all the battery metals as the electric vehicle market continues to emerge. The transformation has seen the company rebrand from ‘Sula Iron & Gold’ to ‘African Battery Metals’ and Sula founder Nick Warrell step down as the firm’s chief operating officer.
In December, ABM launched a £1.75m placing to buy a 70pc stake in Kisinka and an option over a second licence called Sakania. Kisinka is situated within 30km of Lubumbashi, the regional capital, and is close to seven large-scale Cobalt operations. It based in the Katangan Copperbelt, host to approximately 50pc of the world’s cobalt resources. More specifically, the licence is on the Roan, the geological sequence that hosts most of the Congo’s cobalt and copper that is currently being mined by small mining operations selling metal concentrate to local smelters.
As well as identifying potential targets since beginning the work programme for Kisinka last month, ABM today said it has begun a grab sampling programme in the area. The firm also continues to carry out due diligence on Sakania to decide whether or not to exercise its option. The deadline for this decision has now been extended from 31 January to 31 April.
Chief executive Roger Murphy said the business is also reviewing additional cobalt-copper licences close to Kisinka. He added:
‘We are excited to be on the ground and exploring at Kisinka, starting with a cost-effective systematic exploration programme, which I am confident will deliver encouraging results.’
‘In my view, there is no other area of the world with the cobalt resource and simple non-arsenic metallurgy to supply the very strong demand for cobalt forecast by most experts, some of who are calling for a tripling in demand over the next ten years. We strongly believe ABM is well positioned to be a part of this future demand.’
Finally, the firm announced that an interested party is currently carrying out due diligence on its wholly owned Ferensola Gold Project in Sierra Leone. ABM is currently seeking a farm-out or JV partner for the project, and a second interested group is also expected to be provided with access to the site’s information shortly.
Although ABM’s work in the cobalt market is still in its very early stages, the firm has seen trading volumes greatly increase since it rebranded last month. Despite rising so far this year, the share price remains at a very low 0.05p after being crippled in 2017 by poor performance at Ferensola, and ABM has a market cap of just £1.8m. With momentum now growing, and the firm’s assets offering potential in the strong cobalt market, ABM could be worth a very speculative value punt while shares remain so cheap.
Author: Daniel Flynn
Disclosure:
The author does own shares in the company mentioned in this article
