Cadence Minerals (KDNC ) noted in a statement today that its portfolio company Evergreen Lithium has filed for admission to the Australian Stock Exchange (ASX), aiming for 10 March, 2023. On admission, Cadence will own 8.7% of Evergreen Lithium, worth US$3.96m (£2.27m) at the offer price.
Evergreen intends to advance 3 hard rock lithium exploration projects in Australia:
Evergreen's flagship Byone lithium project covers the northeastern strike extent of the lithium and tantalum endowed Bynoe Pegmatite field south of Darwin, Northern Territory, adjacent to Core Lithium's producing lithium mine. So far, soil samples from 5 target zones at Byone have returned geochemical anomalies indicating lithium mineralisation.
Evergreen's Kenny lithium project is located within the Dundas Mineral Field of Western Australia, close to the Mt. Dean and Mt. Belches-Bald Hill pegmatite fields. Initial field mapping of the project has confirmed "substantial outcropping pegmatites", including a 10km zone in the northeastern section of the site. Evergreen expects results from a comprehensive auger programme to be available shortly after admission to ASX.
Evergreen's third asset is the Fortune lithium project in Australia's Northern Territory, 150km northeast of Alice Springs. It is currently in its application phase and undergoing Native Title procedures. The tenement has not been historically explored for lithium.
In related news, Bradda Head Lithium today announced results from its drilling programme at its San Domingo pegmatite district have been postponed due to high levels of demand at the assay labs, but are still expected this quarter.
View from Vox
Cadence came to own interest in Evergreen after the former sold its 31.5% stake in Lithium Technologies and Lithium Supplies (LT and LS) to Evergreen last summer. The initial consideration was valued at £1.81m, with a further £3.8m shares in Evergreen contingent on the achievement of certain performance milestones by Evergreen.
On acquiring LT and LS, Evergreen became the 100% owner of the aforementioned three exploration tenements in Western and Northern Australia. The flagship Bynoe Field shows much promise as competitor Core Lithium has delineated a JORC mineral resource of 18.9mt at 1.32% Li2O at its immediately adjacent Finniss project. Core Lithium has achieved excellent drilling intercepts at their BP33 prospect of 107 metres at 1.70% Li2O, located within 1 km of the Bynoe project.
Cadence's restructuring into Evergreen has already paid off, with an 8.7% stake to be worth £2.27m at time of ASX listing in March. Evergreen's listing on ASX should add further value to Cadence's portfolio of lithium investment vehicles, including European Metal Holdings and Sonora Lithium.
Additionally, Cadence has full equity exposure to the Yangibana rare earths project in Western Australia through its ownership in Hastings Technology Metals following a similar restructuring initiated last last summer and just finalised yesterday. The move resulted in Cadence owning 1.9% of Hasting's share capital, worth AS$9m (£5.17m). Yangibana holds substantial neodymium and praseodymium resources with an NPV of £570m.
Cadence's 30%-owned flagship Amapa iron ore project in Brazil is also shaping up to be a win for the company after a recently completed pre-feasibility study indicated an NPV of US$949m at a discount rate of 10%, with gross revenues and after-tax profit of of US$9.39bn and US$2.96bn respectively over at least a 16-year Life of Mine (LOM). The pre-feasibility study also indicated a post-tax IRR of 34%, with an average LOM EBITDA of US$235m per year. In October, Amapa's ore reserve was upgraded to 276.24 Mt at 38.33% Fe.
Overall, considerable potential exists across Cadence's portfolio, with strong momentum going into 2023. The sales of LT and LS to Evergreen, and sale of Yangibana to Hastings generated a 321% ROI for Cadence last year. Evergreen's listing on ASX should should add further value to the company whose shares are already up 40% YTD.
Follow News & Updates from Cadence Minerals: