Clontarf Energy LON:CLON, the AIM-listed mining and hydrocarbons exploration company operating in Latin America and Africa has had a good year so far, with a year-to-date return of 198.04% (as at 11:30 20th February 2023).
The Dublin-headquartered company, named after a suburb of the Republic’s capital city ‘The Meadow of the Bull’, seems to be one of those companies that approach the sector like a bull in a China shop, looking for projects that offer value at the present time and follow them up.
Well-travelled
Back in March 2011, the company changed its name from the Persian Gold PLC as it started life as a gold explorer in Iran. However, the company had to withdraw from its Persian adventure, as financial support for the project dwindled from European and UK banks fearing increased US sanctions against companies doing business with Iran.
Clontarf was originally founded by Irish serial entrepreneur, John Teeling, in 2003 who also had involvements in Kenmare Resources LON:KMR, African Gold [ASX:A1G], Botswana Diamonds LON:BOD, several upstream O&G explorers, including formerly AIM-listed Pan Andean Resources (acquired by Petrominerales in 2009) and the Irish whiskey producer, Cooley Distillery. Teeling stepped down from Clontarf in 2021 aged 76, having only just stopped playing rugby and now runs the Teeling Distillery in Dublin with his children.
Since then, under the guidance of Teeling’s right-hand man, David Horgan, Clotarf focussed on oil and gas exploration in Bolivia and Ghana and bidding in Nigeria’s marginal fields auctions and exploring opportunities in Chad.
Ghana impasse
The firm has found the going heavy in Ghana, where it has been locked in negotiations over its Tano 2A concession awaiting the ratification of a Petroleum Agreement signed with the Ghanaian government. Stymied by the Ghanaian impasse Clontarf started looking at other jurisdictions, and in May last year, the Irish miner popped up in Australia, having bought a 10% share in Western Gas of Perth, Australia. This strategic investment gave Clontarf access to the Sasanof exploration prospect offshore Western Australia, which was wholly-owned by Western Gas.
Clontarf, joined a consortium including Global Oil and Gas [ASX:GLV] which holds a 25% stake and Prominence Energy [ASX:PRM] which holds a 12.5% stake in the project. Clontarf’s management spent 2022 trying to exploring alternative opportunities with the Sasanof project one of them. Prior to buying into Western Gas, Clontarf raised GBP3.5m, placing 1.4 million ordinary shares with new investors, via several Australian based brokers, at a price of GBP0.25p per share, representing approximately 61.65% of the Clontarf’s issued share capital as enlarged by the placing.
Dry wells
The money was used to buy into Western Gas and to help fund the exploration activities. Drilling began in May for 25 days and cost short of USD25m, drilled to a total depth of 2,390 metres but found nothing. The company moved on to assess other offshore targets in the sector with its consortium.
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At the beginning of the year, Clontarf was back to market for another GBP1.3m, placing 2 billion shares at GBP0.01p through Australian brokers at a price of GBP0.065p with a view to pushing its other interest forward, primarily its lithium project in Bolivia.
Back in September 2022 the company concluded near-surface exploration on six salt lakes in the South American country, yielding results of 1,420 mg/l at one target salt-lake, and 1,010 mg/l at another. The overall grade averaged 211 mg/l. The company said: “Future drilling will identify the priority brine zones to be tapped, subject to all necessary permitting and applicable laws, and funding.”
Lithium brines
The company is exploring extracting lithium through brines in the same way that CleanTech Lithium LON:CTL is doing in Chile, but are a way from going into commercial production.
The Irish company announced earlier this month a heads-of-agreement 50:50 Joint Venture with OTC Markets traded NEXT-ChemX Corporation (NCX) [OTC:CHEMX] in Nevada covering testing, marketing, and deploying of NCX’s proprietary direct lithium ion extraction technology in Bolivia.
Clontarf will contribute USD500,000 towards a pilot plant construction and testing as an exclusivity fee for the use of the NCX technology. NCX will then issue shares equal to USD500,000 at its next financing to Clontarf.
Market correction, or rally?
Back on 8th November, we noted: “Clontarf Energy advanced 34% by 3.30pm. There’s no formal news here and almost half of the gain can be accounted for in the spread but after a poor summer in the wake of drill results back in May, could this be the start of something better – or is a speeding ticket the next notification investors will see?”Our view since then has not changed very much, as a globetrotting company looking at different minerals and sectors seems to lack focus. That said, lithium stocks are all the rage nowadays, and maybe Clontarf has eventually hit paydirt in lithium brines? CleanTech Lithium has rewarded the faith of its investors so far this year, maybe its time for Clontarf to give a bit back? The jury is out.
Deshe Analytics have Clontarf as a ‘Hold’, saying: “Clontarf Energy’s recently released results from 2Q22 indicate that Clontarf is performing reasonably well and on par with its peers. This typically translates into the stock performing on par with market performance for the upcoming quarter. As such, Clontarf Energy plc received an overall score of 61.”
Clontarf opened trading today (21st February) at 0.1675p, and has offered a year-to-date return of 168.24%, a one-year return of -28.45% with its shares ranging between 0.04p and 0.8p over a 52-week period.
The company has a market cap of GBP7.5m.
