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A-Cap Energy Limited (ASX: ACB) is an ASX listed, metals and mining company based in Australia. The company concentrates on carrying out the exploration work and procurement of cobalt-nickel projects.
On 30th April 2019, the company released the updates regarding Metallurgical Sampling Programme and March 2019 quarterly report.
Results from the Metallurgical Sampling Programme
The widths and grade at the Wilconi Co-Ni Project were confirmed from the results of the first stage of the metallurgical drilling campaign. Two drill holes (AEWRCM001 and AEWRCM002) that were 6.7 kilometres apart, returned 9m of 0.17% cobalt and 9.5m of 0.146% cobalt.
Another two drill holes (AEWRCM003 and AEWRC004) which were located further 2 and 6 kilometres to the south, returned 4m of 0.093% cobalt and 8m of 0.158% cobalt. The samples collected will now be tested in the lab to determine cobalt and nickel recoveries.
Quarterly Activities Report
ACB ended the quarter with a significant achievement diversifying its minerals portfolio, targeting cobalt opportunities. Earlier in December 2018, the company entered into a joint venture with Blackham Resources Limited, to acquire a 75% farm-in interest in the cobalt, nickel and associated reserved minerals. On 30th January 2019, the company had paid A$2.9 million to Blackham for a 20% earn-in of the Reserved Minerals of the Wilconi Project.
On 15th February 2019, the company received an approval regarding an application for a further drawdown of US$2 million, from the companyâs revolving credit facility with the Industrial and Commercial Bank of China Limited (ICBC) Shanghai Hongqiao Branch.
Wilconi Project â Joint Venture with Blackham Resources
The JV project (signed in September last year) focuses on cobalt and nickel materials supply to the global electric vehicle (EV) market. The projectâs highlight (announced in December 2018) mentioned that during the feasibility work, new and innovative geophysics and metallurgical technology will be utilised.
Due Diligence Studies
The company has undertaken due diligence studies (announced on 21 December 2018) on the Wilconi Project. The initial block modelling has shown an exploration target to be approaching the companyâs target, of approximately 60 to 70 million tonnes @ 0.08 - 0.1% cobalt.
Metallurgical Drill Programme (as announced on 22 March 2019)
A metallurgical drill sampling programme was completed early April 2019, for the purpose of collecting bulk samples.
Other miscellaneous updates
- Last year, the company contracted Ultramag Geophysics Pty Ltd to investigate the possibility of utilising deep ground penetrating radar (DGPR) to define the characteristics of the Wilconi laterite. The data has now been processed for an earlier investigation by the company for the possibility of utilising DGPR.
- For the proposed exploration (announced on 21 December 2018) the company will be using a combination of DGPR and targeting higher cobalt zones to aim to drill out a resource systematically.
- The company was granted Mining Licence (on 12 September 2016) designated ML 2016/16, which is valid for a period of 22 years.
Cashflow report
The company used a total of A$755,000 million for the operating activities, the highest expense being incurred on payments for administration and corporate costs, which led to the cash outflow of A$398,000. Other major expenses were incurred on exploration & evaluation (A$306,000), staff costs (A$64,000).
It used net cash of A$2.9 million for investing activities, and A$2.9 million of payments towards tenements. Financing activities have led a total cash inflow of A$2.72 million, including A$2.8 million which was received against proceeds from borrowings. At the end of the quarter, the company had net cash of A$2.84 million in the balance sheet.
The company also estimated the future cash outflow for the next quarter which stood at A$1.07 million. It estimates the exploration and evaluation costs to increase up to A$607,000 from the current quarter exploration and evaluation costs of A$306,000.
Technical Outlook
The stock of the company last traded at a price of A$0.038, on 29 April 2019.
