Aguia Resources (ASX:AGR),a Company focused to grow its portfolio of copper exploration projects as well as progress its phosphate assets, is a fertiliser focused company. Its located in a prime farming area which is totally dependent on phosphate imports- State of Rio Grande do Sul, Brazil.
Being a large agricultural producer, Brazil offers many opportunities for agrochemical companies where the market is experiencing several joint ventures among global players, leading to an increase in the market share for them.
On one hand Brazil is considered as an agricultural powerhouse across the globe, simultaneously AGR’s deposits in southern Brazil are characterized by high-quality, low-cost production, and are ideally situated with vicinity to infrastructure like road, rail, and port for support activities.
The Company’s projects are shown in the figure below:
At the Três Estradas Phosphate Project, Aguia Resources reported the conclusion of an autonomous Scoping Study in January 2020, which highlighted the favourable economics of the project as well as modest economical mining and processing required to facilitate the production during the its first phase.
The below table gives the glance of the financial analysis from the scoping study:
The study provides ample validation to the excellent economics for Aguia Resources at the Três Estradas Phosphate Project.
Details of the Scoping study at: Aguia Resources’ Developments at the Três Estradas Prospect
Funding for Capital Expenditure
After receiving the excellent results from the scoping study, the same were studied by numerous parties including domestic Brazilian banks as well as other financiers, and possible off-takers. Based on the assessment and study, the Development Bank of Southern Brazil extended its support for a development loan to finance up to half of the capital expenditure for the Três Estradas Phosphate Project and offered a letter validating the same.
Agronomic Tests Return Positive Results
Fast-forwarding to March 2020, AGR obtained positive results from the agronomic tests that were well within the required specifications to produce a Natural Phosphate Product and surpassed anticipations through the initial agronomic laboratory tests conducted on the DANF for the Project.
In addition to this, the results highlighted exceptional solubility and returned a solubility of 22.9% in a 2% solution of citric acid, indicating a level well beyond the least requirement of 15%.
Progress Towards Obtaining LI
Aguia Resources has been progressing well toward the advancement of its Três Estradas Phosphate Project and is keen to obtain installation licence (LI) for the project which would offer approval for the construction of the project. In addition to this, AGR has been actively engaged in the initiatives of environmental plans and programs, engineering plans for Phase 1, national mining agency as well as land acquisition with a view to fulfil all the requirements for obtaining the LI.
Drilling Completed at Copper Operations
Moving to the copper project, Aguia currently has significant standing in the Rio Grande Copper Belt and the position of AGR was enhanced by the acquisition of the Andrade Copper Project and nearby tenement packages in February 2019.
Recently, the Company received highly encouraging results as they intercepted mineralization through completion of a diamond drilling program in the Rio Grande Copper Belt. Moreover, this also offered validation to Aguia’s 3D modelling of a plunging high-grade zone and to the north and south extensions of the high-grade copper zone within the existing Andrade Mineral Resource area.
The Andrade Deposit has returned significant mineralization from diamond drilling historically as well, where an Inferred Mineral Resource Estimate of 10.8 million tonnes with an average grade of 0.57% Copper and 2.56 g/t Gold was declared by the Company during March last year, and there has been no significant change in the resources since then.
AGR looks forward to undertaking initial metallurgical test work at the Project for assessing the behaviour of the copper mineralization and to assess if they are open to leaching in the coming time. Also, the Company expects that the Andrade is likely to be a relatively low-cap, fast start-up heap leaching operation which has the potential to become a core regional project.
The AGR stock closed at $0.065 per share on 18 May 2020 with a market capitalisation of $ 14.36 million.
Please Note: All financials mentioned above are in AUD, unless otherwise specified.
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