Published On: August 17th, 2023
Figure 1: Drilling at Sorby Hills Project, Western Australia
Boab Metals Limited (ASX: BML) is a Perth-based ASX listed exploration and development company specialising in base and precious metals. With a strong focus on advancing the Sorby Hills Project in the East Kimberley region of Western Australia, Boab Metals is a prospective near-term West Australian Lead-Silver producer. The Company maintains strong ties to Kununurra and the East Kimberley community, highlighting its dedication to supplying essential metals for a sustainable future.
Boab Metals’ Impressive Project Portfolio
Sorby Hills Silver Lead Zinc Project
Sorby Hills is Australia’s largest untapped lead-silver-zinc deposit with mineralisation conveniently located close to the surface. Boab Metals is actively working on advancing the Sorby Hills Project, situated just 50 km northeast of Kununurra to a Final Investment Decision (FID).
Boab Metals Limited holds 75% ownership in the Sorby Hills Joint Venture Project. With granted mining leases, and West Australian Environmental Protection Authority (EPA) approval for open pit mining and associated infrastructure, Boab Metals has an excellent opportunity to fast track production. Sorby Hills is strategically positioned at just 150km from Wyndham Port which can be accessed via an existing sealed highway from the project gate.
Figure 2: Regional Geology Setting of Sorby Hills Project
Sorby Hills is situated in the Bonaparte Basin. The Bonaparte Basin is a remote and under explored mineral provence, proven to be prospective for rich carbonate-hosted lead-silver-zinc mineralisation. It is known to form mineral districts hosting millions of tonnes of base and precious metals.
In 2018 Boab commenced a systematic and targeted approach to its drilling which in turn paved the way to an increased and robust resource. This allowed the company to reach several critical milestones towards development. The company has announced three progressive mineral resource statements (MRE) and growing ore reserves.
Figure 3: Current drilling at Sorby Hills Project
|Life of Mine
|Avg Lead Grade
|Avg. Silver Grade
|Lead Treatment Charge
|Silver Refining Charge
|G & A
|Net Operating Cash Flow
|Sustaining Capital & Closure
|Net Project Cash Flow
|Average Annual EBITDA
*Macroeconomic assumptions for Lead, Silver and FX were based on the forward curves extracted from Bloomberg on 16 January 2023.
Eight Mile Creek Project (Exploration Licence E80/5317)
Boab Metals Limited holds 100% ownership of the Eight Mile Creek exploration tenement that spans 206 square kilometres of underexplored land, situated south of Sorby Hills. A stretch of 30 kilometres along the geological formation holds significant potential for hosting deposits akin to Sorby Hills.
Figure 4: Eight Mile Creek Drill Hole Location Map
Highlights of the Eight Mile Creek Project
- Drilling has confirmed a favourable stratigraphic environment and fluid traps that could contain mineralisation resembling Sorby Hills.
- In 2022, a drilling initiative focused on two specific locations to assess the potential for structurally influenced mineralisation and the flow of ore brines in the southern section of the Burt Range Sub-basin.
Manbarrum Zinc-Lead-Silver Project
The Manbarrum Project is in the Northern Territory, strategically sits just 25 km east of Boab’s flagship Sorby Hills Project. Boab Metals own 100% of the Project, which encompasses related mining leases, applications for mining leases and exploration licences.
Figure 5: Geological Location of Manbarrum Project
Encompassing a substantial area of 175 square kilometres, this package includes promising tenements, incorporating two already granted mining leases. Mineral resources have been officially reported for two specific prospects, Sandy Creek and Djibitgun, situated within the confines of the Manbarrum Project region.
The geological characteristics found in these tenements are closely linked to those discovered at the Sorby Hills location, enabling a seamless transfer of technical expertise to enhance exploration and Resource development potential at Manbarrum.
Highlights of the Manbarrum Project
- Exploration activities undertaken at Sandy Creek’s mineralisation by previous owner Todd River Resources showcases two distinct characteristics – a substantial, flat layer of minerals within sandy carbonate rocks situated just below a regional shale layer known as the Milligan’s Formation and mineralisation present in steeply-inclined, high-grade fissure zones that have historically yielded remarkable intercepts.
- Boab Metals is yet to conduct an independent verification for the resource of associated deposits.
- Boab Metals believes these high-grade zones are excellent areas to explore further. Insights gained from exploring the Sorby Hills deposit will be used to enhance the Sandy Creek geological model and increase the resource size and grade with subsequent drilling programs.
Clean Power Solution
A Heads of Agreement with Horizon Power in respect to future power supply from the Ord River Hydro Power Plant to the Sorby Hills Project was executed in April 2022.
The key indicative terms are:-
- Delivery of firm power over a 10 year term with a purchaser option to extend; and
- Cleaner, cheaper electricity sourced from Ord River hydroelectric plant modelled to provide +90% of power to the Project.
- Modelling indicates the hydroelectric power solution with back-up diesel is more economic than a stand alone diesel plant.
Figure 6: Ord River Hydro Power Plant
Path to Market
Sorby Management Pty Ltd has an executed agreement for access and stevedoring services with Cambridge Gulf Limited with respect to Wyndham Port. All port operations and management are overseen by Cambridge Gulf.
The agreement with Cambridge Gulf is a critical element of the path to market for the concentrates that will be produced at Sorby Hills and shipped to customers.
Wyndham Port is located 150km by existing sealed road from Sorby Hills and is the only deep-water port between Broome and Darwin in Australia.
The terms of the agreement extend to April 2034 with an automatic rollover on a 12-monthly basis thereafter.
Figure 7: Wyndham Port (Courtesy of Cambridge Gulf Limited)
- Late last year Boab Metals concluded its Phase VI drilling campaign at the Sorby Hills Lead-Silver-Zinc Project, yielding favorable outcomes in significant areas that are likely to contribute to the expansion of reserves. The Company commenced its Phase VII drilling campaign in June 2023 with results expected to begin to flow in the next quarter.
- In March 2023, Boab Metals initiated the detailed engineering and design phase for the Sorby Hills Project. The contract was awarded to GR Engineering (GRES).
- Boab Metals completed the Definitive Feasibility Study (DFS) for the Sorby Hills Project in January 2023. The study yielded promising outcomes and estimated an open pit production target of 18.3 million tonnes, boasting an average concentrate grade 65% Lead and 665 g/t silver.
Boab Metals Limited places great importance on building strong connections with stakeholders and local communities. By actively engaging with these groups, the Company gains insights into its activities’ social, cultural, environmental, and economic effects.
Boab Metals Limited and Mr Simon Noon, MD & CEO, support various local communities from education and arts backgrounds. The Company sponsors the annual Boab Metals Ord Valley Muster, a celebration of East Kimberley’s music, art, and culture.
Boab Metals also sponsors Teach, Learn, and Grow (TLG) to enhance students’ education in the East Kimberley region of Western Australia. TLG’s mission is to empower every child (especially from rural areas) to achieve their maximum educational potential.
The exponential growth of electronic devices amplifies the demand for lead and silver as they are essential components in electronics and advanced telecommunications infrastructure. Boab Metals Limited, with its strategic focus on lead and silver, is poised to capitalise on a range of compelling opportunities and positive aspects within the industry.
Furthermore, the global shift towards renewable energy sources, particularly solar power, drives demand for silver due to its efficient conductive properties that enhance energy capture and conversion. Beyond their functional applications, metals like silver hold value as investment assets.
In an article reported by Reuters, the International Lead and Zinc Study Group (ILZSG) predicts that there will be a shortage in the supply of refined zinc and lead compared to the global demand in 2023. The institution (ILZSG) forecasted the global zinc demand and supply gap 45 kilotonnes deficit.
There is an expectation that the worldwide demand for refined lead metal will grow by 1.7% in the current year, reaching 12.53 million tonnes. At the same time, the projection indicates that global lead mine production will experience an increase of 2.8% to reach 4.56 million tonnes.
As technological innovation continues to shape industries and society, the demand for lead, silver, and zinc is poised to persist and evolve, marking their significance as fundamental and irreplaceable elements in our modern world. Boab Metal’s dedication to sustainable practices, community engagement, and technological advancements positions the Company at a great place in the market.
Mr Simon Noon, Managing Director of Boab Metals Ltd
With almost 15 years experience in managing public resources companies, Mr Simon Noon, the Managing Director and CEO of Boab Metals Limited, boasts a solid background in strategic management, business planning, finance, and capital raising across diverse commodities.
His impressive track record includes elevating Groote Resources Ltd’s market capitalisation from under AUD 10 million to market highs over AUD 200 million. Mr Simon Noon co-founded West Rock Resources Ltd and served as Managing Director until its acquisition by Boab Metals Limited in 2013. In this role, he successfully established joint ventures and strategic alliances with mid and top tear miners in the mining industry.
Mr Simon Noon has been at the helm at Boab since 2013, overseeing exploration and project evaluation across Australia and South America. Notably, he led the significant acquisition of Sorby Hills in Western Australia in 2018. Under Mr Simon Noon’s leadership, Sorby Hills has witnessed a 50% increase in mineral resource size and the completion of a high-quality Pre-Feasibility Study (PFS) and a Definitive Feasibility Study highlighting the Project’s strong economics and low risk.
A dedicated member of Western Australia’s resources sector, Mr Noon is associated with esteemed organisations such as the Australian Institute of Company Directors and the Australian Institute of Management.
Latest News from Boab Metals Ltd
- Boab Metals Limited made significant advancements at the Sorby Hills Lead-Silver-Zinc Project in the latest quarter, moving closer to a decision to mine for its flagship Western Australian Project.
- The Front-End Engineering Design (FEED) process remains on track for completion by September 2023, while the phase VII drilling campaign at Sorby Hills has commenced, with assay results expected in the same quarter. Boab Metals also continues active discussions regarding construction financing and offtake agreements.
- The Company’s strong financial standing, reflected in a consolidated cash balance of around AUD 4.6 million as of June 30, 2023 further solidifies its position for future developments.
Boab Metals’ Investor Outlook & Financials
- Boab Metals Limited and Mr Simon Noon, MD & CEO‘s commitment to uncovering valuable base and precious metals sets the stage for exciting opportunities. The Company’s dedication to responsible exploration and development aligns with the growing demand for these essential resources.
- Sorby Hills Project, the key driver of Boab Metals’ growth strategy, benefits from established infrastructure and permits, offering a pathway to streamlined production
- Boab Metals stock stands at AUD 0.20 per share as of August 9th, 2023, with a 52-week range of AUD 0.150 – AUD 0.375
- The Company has a market capitalisation of AUD 34.89 million as of August 9th, 2023, with 174.46 million shares on issue
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