Strategic Minerals (SML ) said its 100% owned subsidiary Cornwall Resources (“CRL”) has signed a 10-year extension to its existing Redmoor exploration licence agreement, securing its footprint in the region and adding “long term confidence” to the tenure of the project.
The original Redmoor exploration licence, which provides the rights to explore over the entire area, was due to expire in 2027, this has now been extended to 18 October 2037, it reported.
There also remains a mining lease option which provides the right for CRL to enter into a 25-year mining lease (renewable for a further 25 years) over any part of the licence area.
During the exploration licence period, a modest annual licence fee is payable to the vendor which converts to a 3% net smelter return vendor royalty on mining commencement.
The original exploration licence was entered into by New Age Exploration Limited in October 2012, whereby the rights were acquired via an exploration licence and mining lease option arrangement, over a 23km2 area surrounding the Redmoor deposit in East Cornwall.
CRL’s most recent updated inferred mineral resource was produced by Cornwall based consultants Geologica (UK) and totals 11.7 mt @ 0.56% WO3, 0.16% Sn, and 0.50% Cu.
A General Permitted Development Order (“GPDO”) application is now in progress to seek approval to conduct a focused drilling programme targeting new tin prospects in the area.
The company explained that earlier trenching work across this Redmoor area has indicated potential near surface tin deposits which could be likely to accelerate mining commencement.
With tin, tungsten and copper prices all significantly higher than those utilised in the update on the project’s projected economics from 21 November 2021, the Directors said they believe that the project after tax NPV at 8% pa is expected to further increase from the US $163m previously reported. This is despite an expected increase in mining costs since this time.
Peter Wale, Executive Director of Strategic Minerals and Director of CRL, said the new end date of the licence extension secures the company’s footprint in the region and adds long term confidence to the tenure of the Redmoor project, which, he explained, “comes at a time when Cornish assets are starting to attract ever greater interest and rising valuations.”
“Tin continues to attract wider coverage both within and beyond the mining community and this has been reflected in the substantial tin price appreciation since SML took full ownership of the project. On top of that, tungsten is also quietly edging up and is now approaching 8-year highs. There has been significant US oil and gas industry demand for tungsten.”
The evolving Critical Minerals agenda is also seeing companies consider more carefully where they are sourcing materials. Heightened concerns on critical mineral supply in the US have also resulted in the Defence
Production Act being invoked to increase domestic production of minerals used in both the EV space and the wider clean energy economy.
He added: “Last month Canadian miners secured a total of C$3.8 billion in potential government funding to develop critical minerals necessary for electric vehicles and other technologies. We look forward to the UK Government taking a similar stance.”
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Despite an expected increase in mining costs, the Directors believe that the project after tax NPV at 8% pa is expected to further increase from the $163m previously reported at Redmoor as the price for tin, tungsten and copper remain significantly higher than in November 2021.
The price of tungsten has been edging up in recent months, with the commodity now approaching 8-year highs with particular demand from the US oil and gas industry.
With the concerns on critical mineral supply having informed US regulation such as the newly invoked ‘Defense Production Act’ to increase mineral domestic production, the UK is expected to take a similar stance as the EV space and the wider clean energy economy gains traction.
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