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SOVEREIGN METALS LIMITED - Corporate Spotlight

Sovereign Metals is a Western Australian based, Malawi-focused rutile minerals sands... Sovereign Metals is a Western Australian based, Malawi-focused rutile minerals sands miner, sitting on potentially the largest rutile deposit on earth. Rutile is a scarce Titanium feedstock.More

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Corporate Spotlight

Sovereign Metals is a Western Australian based, Malawi-focused rutile minerals sands miner, sitting on potentially the largest rutile deposit on earth. Rutile is a scarce Titanium feedstock.
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SVM and one of the world's largest rutile deposits

SVM AND RUTILE: THE $4B COMMODITY

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Sovereign Metals (ASX:SVM) and rutile: the $4B commodity you’ve never heard of






  • Rutile is a mineral investors have probably never heard of, but up-and-coming player Sovereign Metals (SVM) says it's something they'll certainly want to brush up on
  • Global supplies for this little-known commodity are scarce, but global demand for its uses as a bright white pigment remains strong
  • What's more, Sovereign Metals holds a game-changing asset in this market: the Kaysia Deposit in Malawi, which is tipped to be one of the largest rutile deposits in the world
  • Embellished by compelling testing results, fresh discoveries surrounding the prospect and the backing of world-renowned precious metals investors Sprott Capital Partners, the Sovereign rutile play is arguably a movement waiting to happen
  • Sovereign Metals is trading at 56 cents per share this afternoon in a $216.8 million market cap

Rutile is a mineral investors have probably never heard of, but up-and-coming player Sovereign Metals (SVM) says it's something they'll certainly want to brush up on.


What is rutile?


Technically, rutile is the cleanest and purest form of titanium dioxide in nature.


When processed, its properties lend it to use primarily as a pigment for paints and plastics, but it’s also adapted to use in welding rods and, of course, titanium metal.


Commercially however, rutile represents a huge investment opportunity and touts a robust demand forecast. The global rutile market is tipped to balloon to $4.1 billion by 2025 after growing at a compound annual growth rate of 4.8 per cent between 2020 and 2025.


Even more intriguingly, this little-known and in-demand commodity is also in scarcity.


Global rutile supplies are effectively in a structural deficit as mature mines yield declining commodity grades and struggle to meet quality and volume demands.


With demand and supply at odds with each other, rutile poses some lucrative prospects for investors looking for the next hot commodity.


There have also been no major mining developments to speak of in this market, until now.


Enter Sovereign Metals


Sovereign Metals owns the Kasiya deposit in Malawi. A deposit that embodies the key characteristics of a lucrative mining prospect; it's significant in size, yielding high-grade finds, and its riches are simple to access.


It also happens to be considered one of the largest rutile discoveries in the world.


This discovery is set to make Sovereign, putting it at the helm of a tenement with demonstrated exploration success and in close proximity to all necessary existing infrastructure.


What's more, the mineralisation in place is occurring from the surface and hosted in soft free-dig friable saprolite. In broader terms, this equates to efficient excavation and hence lower mining costs.


Sovereign Metal's mining process means it's ready for production as soon as it comes out of the ground, offering a key point of difference for pigment producers over the typically higher energy and carbon-intensive processes used in synthetic rutile or titanium slag.


In essence, the Soveriegn-Kasiya deposit play offers investors a transparent, simple and lower risk mining process that doesn't take a geology degree to unwind and beholds a clear pathway to unlocking its value.


Fresh discoveries and one to watch


What's more, there looks to be plenty more to come from the prospective Kasiya project.


Sovereign has recently hit a fresh discovery zone at Nsaru in close proximity to the Kasiya deposit, which has shown promising indicators of high-grade mineralisation and a swathe of potential new targets for the ASX-lister.


Returning grades of eight metres at 1.10 per cent including four metres at 1.27 per cent rutile and 11 metres at 1.24 per cent including five metres at 1.56 per cent rutile, it's clear there's plenty more where this particular rutile came from.


In terms of cash, the ASX-lister has pocketed a healthy dose of funding via an institutional placement that was led under the guidance of world-renowned precious metals investors Sprott Capital Partners, with affiliates of the Sprott group itself taking up a stake in the offering.


With an $8 million cash boost in place to fuel drilling pursuits and the backing of investors linked to one of the most prominent precious metals financiers in the world today, Sovereign is riding on far more than speculation.


Hot commodity in a scarce market


Investors need only look to the highly poignant story that evolved within the lithium space in recent years to understand the perks of choosing the right stocks locked up in an undervalued commodity play.


But it's not just lithium that's expected to benefit from the lucrative opportunities in the electric vehicle industry.


According to Industry ARC, the automotive industry held the largest share in the rutile market in 2019 and is projected to grow at a compound annual growth rate of 5.6 per cent during the forecast period 2020 to 2025.


Unlike the lithium market however, the rutile market is not nearly as diluted — for context, there are 40 ASX-listed lithium stocks and only four with a rutile focus.


As most investors would be aware, the scarcity of a commodity makes it all the more valuable in a global market, ergo, opening up a huge opportunity for Sovereign.


Fellow rutile producer, Iluka Resources, managed to achieve US$1220 per tonne for rutile sold in 2020, further demonstrating a promising and robust forecast for the commodity.


The Sovereign Metals rutile play is at a key inflection point in its journey.


With global reserves continuing to deplete and the demand for rutile facing an upward trajectory, Sovereign holds a key mining asset that will prove to be priceless when the rest of the market catches on.


Sovereign Metals is trading at 56 cents per share this afternoon in a $216.8 million market cap.


To read the full article on The Market Herald click here. 

SVM to bank $8M under Sprott investment

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Sovereign Metals (ASX:SVM) looks to bank $8M under new Sprott investment

ASX:SVM    
Sovereign Metals (ASX:SVM) - Managing Director, Dr Julians Stephens - The Market Herald
Managing Director, Dr Julians Stephens


  • Sovereign Metals (SVM) has tapped institutional investors for a tidy $8 million in a placement backed by Sprott Group affiliates
  • Sovereign offered up 20,000,000 new company shares at 40 cents apiece under the placement, with a one-for-two unlisted option attached to each
  • The fresh capital is set to fuel exploration and drilling endeavours at the company's flagship rutile Kasiya deposit in Malawi
  • The news also follows a new discovery target within the region, which Sovereign says shows high-grade mineralisation and touts a nine-kilometre strike length
  • Sovereign is trading steady at 45 cents per share on Tuesday morning



Sovereign Metals (SVM) has tapped institutional investors for a tidy $8 million in a placement backed by Sprott Group affiliates.


The placement


All up, 20,000,000 new Sovereign shares were on offer for 40 cents apiece, with a one-for-two attaching unlisted option at an exercise price of 50 cents and a 12-month expiry.


The placement was headed up by global precious metals investment firm Sprott Capital Partners, with affiliates of the Sprott Group also participating in the placement.


The fresh capital is set to fuel exploration and development activities at the company's strategic rutile province in Malawi, with a maiden mineral resource for its flagship Kasiya rutile deposit tipped for the end of this quarter.


Rutile is a titanium oxide mineral typically used for manufacturing refractory ceramics and in the production of titanium metal. It can also be crushed into a powder form and used as a white pigment in paint.


The discovery


The fundraising comes in the wake of a new high-grade rutile discovery in close proximity to Sovereign's flagship Kasiya deposit in Malawi.


According to Sovereign, the new Nsaru deposit is showing high-grade mineralisation from the surface with widths of up to 5.5 kilometres across and a current strike length of about nine kilometres.


Looking ahead, Sovereign is set to continue drilling at Kasiya and the surrounding area to identify extensions and discover new regional mineralised zones.


Sovereign Metals is trading steady at 45 cents per share at the open of Tuesday's trading session.



ABOUT US

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Sovereign has identified a potentially globally significant, strategic rutile province across its large Malawi ground holding. The Malawi Rutile Province features two confirmed, discrete rutile mineralisation styles hosted respectively in sand and saprolite (soft, friable weathered material) which are both amenable to conventional processing.


Rutile mineralisation identified to date has generally not been spatially constrained by drilling at either of the two main prospects, Kasiya (saprolite) and the Bua Channel (sand).


The Company is targeting large resources that could support long-life, large-scale rutile production.


HUGE EXPLORATION UPSIDE


Regional exploration continues to identify new rutile prospects. Sovereign has a significant number of untested targets and a large amount of unexplored ground across the Company’s very large ground package.


The majority of key prospects and targets are located in close proximity to key infrastructure.




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SVM and one of the world's largest rutile deposits


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