On Thursday afternoon, Strategic Minerals (SML ) confirmed to investors the rollover of access to the company’s magnetite stockpile in New Mexico for the tenth consecutive year.
Strategic Minerals acquired the distribution rights to the Cobre magnetite tailings dam project in New Mexico back in September 2011; the project, a cash-generating asset, was brought into production in 2012 and which continues to provide a revenue stream for the Company.
The tenth yearly rollover of access to the Cobre magnetite stockpile ‘ensures continuity of profitable operations for the year ahead’ and augurs well for future rollovers, it explained.
While the quarter to 31 December 2021 and January 2022 saw a significant drop in demand, the Group said February 2022 has seen sales 12% higher compared to February 2021 and the first two months of 2022 combined are only marginally below that of sales in 2021 sales.
Meanwhile, the Company highlighted that its wholly owned subsidiary, Southern Minerals Group (“SMG”), is currently lodging a claim for US$21.9 million as per its recent arbitration.
This follows a move from the Receiver for CV Investments LLC which was successful in getting the United States District Court, for the District of New Jersey, to enter an order establishing claims procedure and setting claims with a Bar Date of 25 April 2022.
It said this development is ‘encouraging’ and may indicate some sort of financial result for SMG before the end of the year, although there is no guarantee as to timing or amount.
Commenting, John Peters, Managing Director of Strategic Minerals, said: “While not unexpected, the rollover of access at Cobre is always an important milestone in SML’s calendar. Given our close relationship with the mine owner, the rollover was expected and the Board and Management do not currently foresee any problems with future rollovers.”
The Group said it is pleased to see the state of the CV Investments’ receivership and that it anticipates, but is not relying upon, a cash settlement arising from the closure of this matter.
Peters acknowledged the recent significant rises in the copper price, to over US$4.50/lb, which continues to heighten interest in the company’s Leigh Creek Copper Mine project.
Strategic Minerals acquired Leigh Creek Copper Mine, located in the copper rich belt of South Australia, in 2018, thereafter bringing the project temporarily into production in April 2019.
In early January 2022, an updated Program for Environment Protection and Rehabilitation (PEPR), addressing the conditions associated with the July 2021 approval, was lodged.
The Group said it looks forward to the Leigh Creek Copper Mine joining the Cobre magnetite stockpile this year “as a second income stream, subject to securing the necessary funding.”
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