TORONTO (miningweekly.com) TSX-V-listed project developer Bacanora Minerals, which is working to advance its Mexican borate and lithium projects, intends to list its stock on the London Stock Exchanges Alternative Investment Market (Aim) in July, which is expected to be the only new mining issuer to start trading on the platform in recent months.
Management of the Calgary, Alberta-based firm, which as on Saturday had a valuation of about £30-million, or C$54-million, is this week engaged in a road show in London to raise awareness and about £1.5-million to generate a modest amount of liquidity there ahead of assuming its Aim listing in July.
Bacanoras main assets are the Magdalena borate project and the Sonora lithium project, both located near Hermosillo, in northern Mexico.
The Magdalena borate project, which has 1.17-million tonnes of borate resource, is already in pilot production. Bacanora intends to expand the current pilot plant to a full commercial plant, producing 50 000 t/y by the third quarter.
Borates are one of the lesser-known commodities and are mainly used in insulating fibreglass, glass manufacturing, solar panels, ceramics and glazes, and world consumption is estimated to reach about two-million tonnes this year, up from 1.5-million tonnes in 2010, according to the US Geological Survey (USGS).
Two producers dominate the borate market, including diversified miner Rio Tinto (through a subsidiary Borax), and Eti Maden, a Turkish State-owned business, which alone accounts for about 47% of the market share. The listing on Aim will allow Bacanora to raise additional funds to build the commercial plant once all of the pre-feasibility studies have been completed this year.
A preliminary economic assessment had given the project a net present value at an 8% discount rate of $113-million, based upon a commodity price of $500/t for colemanite concentrate.
The Sonora lithium project is one of the biggest known lithium deposits in the world, with about 3.28-million tonnes of lithium carbonate equivalent (LCE). The main usage for this type of lithium is for lithium-ion batteries, and the Sonora assets are battery grade (99.5%+).
The project is owned with joint-venture partner David Lenigas‘s Aim-listed Rare Earth Minerals, which has a 30% stake in a number of the concessions within the Sonora project, with an option to increase this holding to 50%.
A preliminary economic assessment had placed a net present value with an 8%-discount rate of $848-million on the 100%-owned La Ventana concession of the project. Bacanora has also developed a process for recovering lithium from the clays and converting it into battery grade lithium carbonate.
Large producers including SQM, Rockwood, FMC Corp and Talison Lithium dominate the lithium market today and global production in 2013 reached 186 000 t. The USGS had estimated global reserves of LCE at about 68.1-million tonnes.
Demand for lithium-ion batteries is expected to surge in the coming decade as they are increasingly used in battery-electric and plug-in hybrid cars.
Bacanora was co-founded by chairperson Colin Orr-Ewing, whose background includes 35 years of experience in the natural resources sector, having been an investment manager at Shell Pension Fund and going on to chair a number of oil and gas an mining companies. Martin Fernando Vidal Torres is the companys president and Shane Shircliff is the CEO.
The word Bacanora refers to a Mexican agave liquor traditionally distilled in the hills of Sonora with much care and attention.
Despite the companys TSX-V-listed stock on Monday trading 12.79% lower at C$0.75 apiece, the stock had more than doubled in value from the start of the year.
