More Valuable Than Gold
OTC Markets "SIDNF" Canada TSX.V "CRU"
Scandium, a rare earth metal, has taken on a new luster with the advent of Robert Friedland getting involved on the heels of John Kaiser’s positive assessment of new potential supply being developed in Australia. Scandium has many positive attributes when it is alloyed with aluminum – making it stronger and lighter – and has recently figured in the new solid fuel cells being developed in California.
The properties being optioned by Cameo have reported values of Scandium (Quebec Gorvernment Survey) in excess of 500-600 ppm Scandium (the mineral Resource grade of the Exciting Australian Property is 280 ppm Scandium) and is located associated with mafic to ultramafic rocks (the common host of the Australian Resource).
Cameo Resources Corp (TSX.V: CRU / OTC MARKETS: SIDNF)
Sector: Metals & Mining Sub-Sector:Industrial Metals & Minerals
TMX Money: CRU
There is a principle known as “the rule of three,” a belief that things that come in threes can produce the most effective outcomes. While this standard is often matched with writing “the rule of three” can also be applied to Cameo Resources Inc. (TSXV: CRU / OTC: SIDNF), a company focused on enhancing shareholder value through astute acquisitioning of exceptional projects in perceived undervalued situations.
When we think of what provides value to a company we consider a number of factors, chief among those are the demand for what they produce, the potential for the market they are in and a proven track record of their management.
Taking a look at Cameo Resources it is evident that these three elements are firmly established within the company!
So let’s take a look at each of these factors and how they relate to Cameo specifically.
One: First we’ll talk about gold and more importantly the projects that Cameo is actively pursuing. As the company states, their operations “go where the prospects and potential discovery is optimum.” When it comes to gold production few countries offer better prospects than Tanzania, the fourth largest gold producer in Africa and closing in on the third spot.
Barrick Gold Corp.(TSX:ABX) which is one of the worlds largest gold producers is also located in Tanzania!
There are two projects in Tanzania that Cameo has ongoing at the moment and they are detailed as followed on the company website:
MOROGORO EAST GOLD PROPERTY
Exploration work completed in the past two years, has identified quartz veins/silicified zones either associated with artisanal placer gold workings or with visible gold on the Prospecting License in the Morogoro area. The geology of Amphibolitic and biotitic gniesses host the zones which are also present on ridges that have resisted erosion rising 10- 20 meters above the surrounding terrain.
In conjunction with exploration a placer operation will be initiated to expand the geologic data base of the property.
Further analysis of the drill core from the property for base and precious metals to expand on the 3 m drill intersection (1.69 g/t) which is in a 2-3 kilometre long mineralized and altered structure will also be completed prior to the commencement of a detailed drilling program.
HANDENI MAGAMBE GOLD PROJECT
The Magambe Gold Property (MGProperty) has multiple element and gold geochem anomalies across the of the property, associated with a structure and continuity of trace amounts of gold and other pathfinder elements on trend northeast from the Canaco Magambazi zone in similar amphibolitic rocks. These zones are part of the overall trend that Canaco is following up and have potential.
The outcrops and rocks seen to date, exhibits a complex structure of brecciated, sheared, fractured, foliated, folded and faulted deformed rock with alteration of silica, chlorite, sulphide and epidote.
With the discovery of significant placer gold immediately south “down stream” from of the anomalous area – the area is very low relief and the gold is very coarse and pristine- is indicative of a local source. The company is incorporating all this information into the proposed exploration program.
The zone on Canaco’s property has been defined by their magnetics proceeds NW from Magambazi and then swings to the NE and enters the MG property. The zone constitutes a major structure that has been identified as having gold deposits on it! This is analogous to the Kirkland Break or other well-established Canadian structural gold trends that host the major gold mines of Canada. In Tanzania the company is a little over 2 years into discovering and understanding the feature.
The value we have here is in demand!
There are few things in this world that rival the demand for gold!
Much has been made of the slide in gold’s price over the past few years but many experts believe that that price has likely hit its bottom and we have most certainly seen an upswing since September of last year.
Two: Now for our second factor, or number two as it applies to “the rule of three.”
Scandium: Scandium is a chemical element (symbol “Sc” and atomic number 21 on the chart), yet for many of us “scandium” is a head-scratcher and that would be understandable; however, enormous value sits within this market as scandium itself is highly valuable… and very rare:
Prices for 99.9995 percent purity scandium oxide are estimated at US$6,000 per kilogram, and prices for all purities have risen substantially since 2009.
Most other products are priced by the gram, and they’re expensive. Here are a few examples:
- 99.9 percent purity scandium acetate: US$43 per gram
- 99.999 percent purity scandium chloride: US$123 per gram
- 99.9 percent purity scandium fluoride: US$263 per gram
- 99.999 percent purity scandium iodide: US$187 per gram
(Note: prices are 2014 estimates as per the 2015 USGS report on scandium, and are based on 5-gram sample sizes.)
According to Stanford Materials, distilled dendritic scandium metal and scandium ingot prices were reported at $221 per gram and $134 per gram respectively.
Just for a little prospective, there are about 28.3 grams in an ounce.
Today Gold is valued at about US$1,255.00 per ounce.
At $221 per gram and $134 per gram, distilled dendritic scandium metal and scandium ingot have a value of US$6,265.23 per ounce and US$3,798.83 per ounce!
That makes it 3 to 5 times more valuable than Gold!
But before we get ahead of ourselves, let’s take a closer look at scandium:
Scandium is a soft, silvery metal that has proven very useful in a number of applications, such as lighting, microelectronics, displays, and ceramics. What we have here is a metal that is necessary for much of today’s technology and Cameo noted in a press release that the rare earth metal had “taken on a new luster with the advent of Robert Friedland getting involved on the heels of John Kaiser’s positive assessment of new potential supply being developed in Australia.”
Due to its applications in alloys as well as solid fuel cells Kaiser has expressed a firm belief that the demand for the metal could become massive. More specifically that those using the metal would be willing to buy if there were a primary, scalable supply available.
IMPORTANT: Therein lies the problem, the main drawback has been the lack of a reliable supply.
Well, guess who has a Scandium project in Quebec:
The properties being optioned by Cameo have reported values of Scandium (Quebec Government Survey) in excess of 500-600 ppm Scandium (the mineral Resource grade of the Australian Property is 280 ppm Scandium) and is located associated with mafic to ultramafic rocks (the common host of the Australian Resource).
What we have here is potential for something very big in a market that has yet to be fully realized.
Three: As for the third factor in our “rule of three” we have what very well may be the most important piece of the puzzle, management with a proven track record of success.
The company is re-uniting the elements that have been successful in developing mineral prospects in Canada and the US for Consolidated Goldwin Ventures (Diamonds in the NWT, Canada & Copper – silver in Nevada U.S.A.) later Encore Renaissance Corp. (Gold in Kamloops area of BC). All these projects discovered financed and explored by the “team” remain active. As well in 2010/11 they initiated Kokanee Minerals and with Cameo’s predecessor (Sidon International) raised over $10 million for exploration in Tanzania. The projects discovered, financed and with exploration initiated remain to be fully tested.
Mr. Patel has worked in the investment industry for over 6 years with junior companies from inception and incorporation to final listing. Having acted as CEO and director of several public companies, and as the head of his own consulting firm, Mr. Patel specializes in the assistance of initial public offerings as well as all regulatory filings. Mr. Patel has received a bachelor in accounting from the British Columbia Institute of Technology with a major in accounting and minor in finance. He also has over 10 years of corporate tax experience and has been an active board member and contributed to the start up of Discovery Ventures (DVN) and WestKam Gold Corp (WKG). Currently, Mr. Patel is still on the Board of Directors for WestKam Gold Corp.
What we have seen from Cameo Resources is a firm understanding of what it takes to succeed and add value for their shareholders.
We may never be able to predict the future but what we can do is formulate a judgement based on what we do know and considering Cameo Resources’ strengths what is to come may be even greater than what we have already seen.
With Cameo Resources currently at just $0.05 on the TSXV Exchange and a mere $0.03 on the OTCMarkets, now is the perfect time to research the Company.
If we were to break the mold and extend our “rule of three” to add a fourth, it would surely be the chart.
As you can see on the chart below, Cameo was recently at higher levels:
Barchart Interactive Chart: CRU.VN
Cameo has toyed several times recently with its annual low of $0.04, each time bouncing back with runs up to $0.07.
If similar action continues, Cameo could be very well worth our time to research.
So don’t wait, get started on your research right away. Feel free to begin with the links below:
Timing could be perfect; don’t let this exciting young “gold nugget” pass you by.
Billionaire mining entrepreneur Robert Friedland has always been worth following.
If it wasn’t his Voisey’s Bay nickel mine success in Canada in the 1990s, then it was his taking of the Turquoise Hill copper/gold discovery made by BHP Billiton in Mongolia to make it what is now known as the Oyu Tolgoi mine, about to expand at a cost of $US6 billion ($8bn) under the tutelage of Rio Tinto.
Never one to count his billions and ride off in to the sunset, copper and platinum is now Friedland’s go in Africa. But tucked away in his portfolio is a 17 per cent stake in a little thing called Clean TeQ (CLQ), which is listed on the ASX, trading on Friday at 17.5c a share or $73 million.
Friedland came on to the register of the Melbourne-based group back in 2013, with the group’s continuous ion-exchange technology the initial attraction for its ability to clean up waste water, either on environmental grounds alone, or a combination of the environmental with valuable metals and minerals recovery.
But it was in the following year that Clean TeQ was to acquire the Syerston scandium project near Condoblin in central NSW from Friedland’s Ivanhoe Mines (now renamed Turquoise Hill and majority owned by Rio).
Ever the visionary, Friedland’s interest in scandium is in the role it can play in the “light weighting’’ of the aerospace and automotive industries. Lower weight means less fuel consumption.
Not such a big deal at the moment given the collapse in oil prices. But oil prices will bounce back as there is no getting away from the fact that near on 100 million barrels a day of the black stuff is consumed each and every day.
The capital strike in response to low prices means that ever depleting oilfields are not being replaced, or found in the first instance with drill bit for that matter.
More than that though is the relentless push for lower emissions, regardless of the oil price. And that is where light weighting comes in to its own. And one of the best ways to do that is to increase the use of aluminium in planes and cars.
This is where scandium comes in. As light and strong as aluminium can be, the stuff cannot be welded with the same degree of confidence in the welds that plane and carmakers need.
As an alloying element, scandium refines the crystal structure of aluminium to the point where the alloyed metal can be welded without loss in strength, as well as delivering other benefits (increased plasticity in the moulding of complex shapes, improved corrosion resistance, and higher thermal conductivity, to mention a few).
Its weldability is what has got scandium fans really excited. The world, on Boeing estimates, is going to need 35,000 new planes by 2032. Trouble is building the things is a slow process because of the time-consuming riveting of panels, even in planes that have gone down the carbon fibre/composites route (Boeing’s 777X will have composite wings but a metallic fuselage).
If the riveting can be replaced by robotic laser welding, the whole process of building a plane will be sped up massively
Now the beneficial properties of adding a pinch of scandium to aluminium alloys has been known for decades. But guess how much scandium is currently consumed globally. It would be lucky to be 15 tonnes of the stuff annually, most of it going in to high end golf clubs, baseball bats and bicycles.
So if its benefits are so great, why only 15 tonnes? One of the problems has been the lack of mine supply, with most scandium coming from the reprocessing of resides in the titanium dioxide industry.
And what supplies of the metal there has been have been from the Ukraine and Russia, which are not exactly the sort of places that the plane and carmakers want to rely on for supplies.
But the world’s low-emissions push goes on, so aluminium scandium alloys will have their day, as the fourth-generation of aluminium-lithium alloys have done.
That there is only 15 tonnes annually being consumed tells you that aluminium-scandium alloys are yet to make their mark in aviation, or the automotive industry, just yet. But the boffins reckon it is a technology ready to go through the qualification process the aerospace industry demands, and by extension the auto industry.
It is against that backdrop that Clean TeQ reckons the world is ready for its first dedicated and non-former Soviet Union scandium mine, acknowledging all that while that the development of Syerston must go hand-in-hand with the development of a new global industry.
To develop a viable scandium market, Clean TeQ recognises it must effectively commoditise the metal by creating reliable supply, produce a consistent product, and offer significantly lower prices for scandium oxide (the precursor to the metal sells for anywhere between $US2000 to $US3000 a kg).
It reckons Syerston fits the bill and it is working to completing a feasibility study in the middle of this year after first striking strategic alliances with Airbus (it has developed the trademarked Scalmalloy for use in high-strength extrusions and a sheet metal) and others in the space.
A lower level scoping study released in May last year gave a feel for Syerston’s potential. Based on a long-term price of $US1500 a kg, a project producing 42.5 tonnes annually (scandium oxide) would have an average cash cost of $US446 a kg. The suggested production level of more than 40 tonnes annually says more than anything else that Clean TeQ reckons the time is right for scandium after being it being in the shadows all these years.
The post-tax net present value of a Syerston development was put at $280m. Best to wait for the feasibility study to confirm that sort of potential, but what can be said is that Syerston is not resource-constrained on becoming something bigger still should the use of aluminium scandium alloys take off in the world’s light weighting push. Friedland for one is betting that just might be the case
Cameo closes private placement for $800,000
2015-09-24 17:27 ET - News Release
Mr. Souhail Abi-Farrage reports
CAMEO ANNOUNCES CLOSING OF PRIVATE PLACEMENT
Cameo Resources Corp. has closed the non-brokered private placement previously announced on July 29, 2015, through the issuance of 26,666,667 units at a price of three cents per unit for gross proceeds of $800,000. Each unit consists of one common share of the company and one share purchase warrant. Each share purchase warrant will entitle the holder to purchase one additional common share of the company for a period of two years at the exercise price of five cents per share. All of the securities issued under the private placement are subject to a four-month hold period expiring Jan. 25, 2016. In connection with the closing of the private placement, the company shall pay finders' fees of $20,020 in cash and 667,333 finder warrants to purchase one additional common share of the company for a period of two years at the exercise price of five cents per share.
The company shall use the proceeds of the offering as follows:
- $350,000 for redemption of fees, rent, expenses ($180,000), and loans ($170,000) owing to Souhail Abi-Farrage, president and director of the company;
- $100,000 for corporate expenses (legal, audit, annual general meeting and miscellaneous);
- $250,000 toward the continuing exploration program on its MEG gold property;
- $100,000 for unallocated working capital.