Lens Through the Resource Platter of Comet Resources in the Commodity Space

The global move towards switching to EV’s over IC engines has garnered popularity among lithium and cobalt space to mention few. However, it is to be noted that lesser-known yet essential, graphite is used in anode of the lithium-ion battery. Australian resource exploration company, Comet Resources Limited (ASX:CRL) appears well placed to tap the graphite opportunities amidst the attractive commodity scenario.

The inevitable future growth of EV’s is expected to drive the graphite demand. The graphite demand increased by 435% over eighteen months as of June 2019 courtesy to Battery Mega factories. In the milieu of which it is pertinent to mention that the demand is anticipated to outpace graphite supply by 2021, thereby providing immense opportunities for a healthier balance sheet to the companies holding graphite projects.

Having said that, the presence of copper in the portfolio can be an icing on the cake, which is expected to grow 4x with surge in battery electric vehicles than the conventional IC engines. Usage of copper varies from motor winding, batteries to charging infrastructure of EVs. Also, popularly known as an economic indicator; there is no denying that the demand for copper is likely to increase in proportion to economic growth. Interestingly, S&P Global Market Intelligence has predicted a shortage of copper by 5.7 Mtpa, i.e. 28% of demand by 2030.

ALSO READ: Comet Resources Relishing The High Tides Of Burgeoning Market Opportunities As Demand For Battery Commodities Booms

With this backdrop, let us deep dive into CRL’s commodity resource depth

Graphite As An Anchor To Exploration Program

The flagship Springdale project held by the Comet Resources is an anchor to the graphite exploration goals of the company. Comet Resources has undertaken a range of activities towards the exploration and development of graphite through the project. Springdale sports broad mineralised zone of high-grade graphite.

The Maiden Inferred Resource at the Springdale project is 15.6Mt @ 6% Total Graphite Carbon (TGC) including 2.6Mt @ 17.5% TGC. At Springdale, the highest-grade intersection of 3.23m @ 51.02% TGC is returned from 35.27m within 42.5m @ 17.02% TGC from 20m (HD024A).

In the Quarter ending December, varying operations centric to graphite exploration were undertaken, returning positive high-grade graphite prospects. The multiple broad zones of high-grade graphite at shallow depth returned from the assays of the diamond drilling program depicted following key results:

• 57m @ 22.38% TGC from HD024
• 17m @ 16.55% TGC from HD022
• 10.9m @ 10.61% TGC from HD031
• 42.5m @ 17.02% TGC including 3.23m @ 51.02% TGC HD024A

Looking for the optimisation of the graphite drilling efficiency, CRL conducted the Aerial Electromagnetic (EM) survey through highly experienced specialist teams. The survey exhibited a powerful tool for exploring shallow, high-grade graphite, thereby enhancing prospects for the augmented capital efficiency in exploration.

Meanwhile, the company is also working towards characterising the graphite and establishing recoveries. Notably, the metallurgical testworks are underway in Perth, while the company also plans to conduct the international testworks for ascertaining the value-add potential of high-grade graphite at Springdale. The German specialist company would also evaluate the spectrum of off-take markets.

Copper Adding Richness To Portfolio

Copper, one of the significant commodities finding its growing demand in BEV markets, complements the existing Springdale graphite project. In this respect, Comet Resources is strategically proceeding the acquisition of Barraba Copper Project situated in Northern New South Wales. The project lies nearby to the Tamworth’s regional centre. Lying in the Tier 1 Jurisdiction, NSW based Copper project is considered highly prospective for copper exploration.

Advancing in its endeavour towards the acquisition of the Barraba Copper Project to further strengthen its hold in the battery commodities space, Comet Resources successfully completed the capital raising of $2 million.

ALSO READ: Comet Resources Gears Towards Low-Carbon Revolution Through Copper Exploration

Outlook

Concerning the Springdale Graphite project, the company is waiting for the results of the metallurgical testworks. Further, international testworks would commence soon. Meanwhile, the company has also planned an active exploration program incorporating an initial drilling program for Barraba Copper Project in Q2 2020.

Stock Performance

In accordance with ASX Listing Rule 3.10A, CRL will be releasing 2 million Fully Paid Ordinary Shares from voluntary escrow on 17 April 2020. These shares are already quoted on ASX and were issued in accordance with the Land Access Agreement.

CRL stock last traded on 7 April 2020 at $0.011 per share.

Disclaimer

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