West Australian explorer, Terrain Minerals Ltd (ASX: TMX) is advancing the exploration and development of its highly prospective mineral projects across Western Australia, with a strategic focus on rare earth elements (REE), gold, and critical minerals like Gallium (Figure 1).
At the heart of Terrain's portfolio is the Smokebush Project, where the company is spearheading exploration for high-grade clay-hosted REEs and Gallium mineralisation, along with gold.
Figure 1: Terrain Projects location map (Source: TMXpresentation)
The Smokebush is a proven host of high-grade clay-hosted REEs and Gallium in an emerging mid-west REE district.
In addition, the company has also confirmed REE and Gallium across its Lort River Project.
A key feature of this project is the Nova-style "eye" feature, where an airborne EM survey is expected to identify nickel-copper ore bodies similar to those at the Nova mine, acquired by IGO in 2015.
Furthermore, the company also has “high quality” lithium, gold/copper and REE projects in the pipeline across Western Australia and Queensland.
TMX shares are currently trading on the ASX at A$A0.004 with a market cap of $A4.29 million (Figure 2).
Figure 2: Terrain Minerals (Source: Asx.com)
Smokebush Project: Gold – REE - Gallium
Located in the Yalgoo mineral field north of Perth, the Smokebush project covers an expansive area of 300 square kilometres (Figure 3).
Here, Terrain is conducting advanced exploration, focusing on high-grade Clay REE and Gallium mineralisation.
The project has yielded promising results, with assay reports from its maiden drill program expected soon.
This will set the stage for a Mineral Resource drilling program scheduled for June 2024 and a maiden mineral resource estimate to be delivered in the December quarter of 2024.
Figure 3: Smokebush Project highlights (Source: TMX Presentation)
Lort River Project: Targeting Nickel and REE
The Lort River Project represents a significant potential for discovery, mimicking the geological characteristics of the renowned Nova nickel-copper mine.
This project, covering 320 square kilometres near Esperance, has already shown signs of substantial REE presence and features a Nova-style "eye" feature identified through aeromagnetic data.
An airborne EM survey kicked off last week aiming to delineate conductive bodies potentially indicative of nickel-copper sulphide deposits.
Figure 4: Lort River Project highlights ( Source: TMX presentation)
Strong capital position and leadership
Terrain maintains a strong financial position with no debt and a capital structure designed to support its expansive exploration initiatives.
The leadership team, led by executives such as Justin Virgin and Xavier Braud, brings a wealth of experience in geology and corporate governance, driving the company's strategic vision forward.
Future outlook and exploration milestones
Terrain Minerals is poised for a transformative phase with several key activities lined up:
Smokebush Project: Upcoming assay results and the subsequent drilling program aim to confirm and expand the known mineralisation zones.
Lort River Project: The ongoing EM survey and follow-up drilling are geared towards confirming the potential for substantial nickel-copper deposits.
Expansion into Critical Minerals: With the exponential growth in demand for semiconductors, Terrain’s focus on Gallium could position it as a key player in diversifying the global supply chain away from dominant producers like China.
With a robust exploration pipeline and a strategic focus on critical minerals essential for the tech and renewable sectors, Terrain Minerals Ltd represents a forward-thinking enterprise within the mining industry.
Thoughts from Samso
Mineral Exploration companies are not unique and there about 800 listed companies which sit in that space. What makes these companies attractive is normally hidden from the public space. The average investor looks at these companies from the surface and bases most of the investing decisions on the projects that they market, the names of the management and the basic financials such as share price, market capitalisation and the enterprise valuation.
In my three decades of working in this sector and spending the last 15 years in the corporate sector, I have to say that unless you are in or are associated with what I call the "Purple Circle" or the inner sanctum of the major investors, everything else pales in significance in terms of the safety of your investment.
Hence, you may be thinking right now, what can we look at if we are not the privileged few that are in the Purple Circle? The one thing that the Purple Circle needs is a good story. The story is one that has two main features, the technical and the narrative aspect, or rather the current of incoming sentiment.
I have spoken to the company and from the surface (I am not in or associated with the Purple Circle), the strategy seems legitimate. Exploring the potential of Gallium for the sentiment is a great way and the search for high-grade nickel sulphide is perfect. High-Grade nickel sulphides may smell now but the future is still going to need nickel and I personally feel that the Green Nickel time is coming.
The continuous degrading of the environment in Indonesia cannot continue and it will start to clean up as time passes. The cheap labour of China is a prime example. 30 years ago, labour was cheap and over the last 15 years, China's labour has been expensive which has driven the manufacturing into other South-East Asian nations.
Australia is regarded as a Tier-1 ESG nation and the chase for Gallium and Nickel Sulphide, in my opinion is setting up terrain for the perfect storm. The projects looked technically positive and the management appeared to be legitimate.
We have done a Samso Insight discussion and that will be released soon, so look out for it.
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