SP Angel IronRidge Resources* (IRR LN) 17.25p, Mkt Cap £53.4m – African frontiers – lithium road to resourceIron

MiFID II exempt information – see disclaimer below


 

IronRidge Resources* (IRR LN) 17.25p, Mkt Cap £53.4m – African frontiers – lithium road to resource

BUY - Target Price 52p

 

SEE LINK FOR IRONRIDGE RESOURCES PDF NOTE

 

  • The highly encouraging second-phase drill campaign assay results complement preliminary geochemical and geophysical data to define a broad host of pegmatite swarms; delineating a maiden JORC-compliant Ghanaian Cape Coast Resource with target 12-15Mt @ 1.25% Li2O (SP Angel estimate).
  • Coarse spodumene intersections are significant for a simple and proven process flow-sheet design, yielding a highly desirable lithium chemical to support accelerating electrification markets.
  • SP Angel scenario modelling targets three viable mine scales, deriving NPVs for 1Mtpa, 1.5Mpta and 2Mtpa processing plants to deliver a 6% Li2O spodumene concentrate only 100km to the Takoradi deep sea port:

 

Cape Coast Operational Summary

Operating Outcomes

1 Mt

1.5 Mt

2 Mt

Unit

Project NPV8 (post-tax)

144

222

298

GBP£m

IRR (post-tax)

50%

53%

54%

%

Target Share Price (post-tax)

46

72

96

Pence

Growth Factor (post-tax)

2.5

3.8

5.1

x

 

 

 

 

 

 

  • Additional IronRidge value is derived from the 3,584km2province-scale gold and lithium pipeline portfolio across Côte d’Ivoire, attributing GBP£19m enterprise value against peers.
  • Fundamental and methodical fieldwork should lead to a material discovery to further validate the promising preliminary grades, in the significantly under‑rated mining jurisdiction of Ghana expecting 15.6% sector growth through to 2021.
  • The Company remain supported by the loyal shareholder base from inception onto AIM, and a strong board and management team with a depth of African experience will drive the maturity and transition from explorer to developer.


*SP Angel act as nomad and broker to IronRidge Resources

 

 

Analysts

John Meyer – 0203 470 0490

Simon Beardsmore – 0203 470 0484

Sergey Raevskiy – 0203 470 0474

James Mills - 0203 470 0486

 

Sales

Richard Parlons – 0203 470 0472

Jonathan Williams – 0203 470 0471

Abagail Wayne – 0203 470 0534

Rob Rees – 0203 470 0535

 

 

SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London

W1S 2PP

 

*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)

+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.

 

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SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return of less than 15%