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Cornish Metals planning to be strategic player in energy sector

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Cornwall has a long history of mining, with the first recorded commercial mines developed 2150BC when Bronze was the big new thing. Rich seams of Tin and Copper saw mining continue in the county almost continuously until the early 20th century.

But as the mines were worked out, (which could be expected after 4,000 years) and production became more difficult, and as new minerals and mining locales emerged which could use industrial technology, eventually mining petered out in Cornwall and disappeared. As the global price of tin plummeted, the last working tin mine in Cornwall, South Crofty, closed in 1998.

However, hoping to revive the county’s rich heritage of mining is AIM-listed mineral exploration and development company Cornish Metals Inc [LON:CUSN]. Cornish Metals is also dual-listed on the Toronto Exchange [TSX-V:CUSN] and headquartered in Vancouver.


Gold to Tin

Cornish Metals was established in 2011 under the name Strongbow Exploration Inc. The company was originally focused on exploring for gold and copper deposits in Canada, but it shifted its focus to Cornwall in 2016 when it acquired the mothballed South Crofty tin project and changed its name to Cornish Metals. At the same time it also acquired the United Downs tenement and the rights to explore across 15,000Ha of the county.

Since then, Cornish Metals has continued to acquire additional exploration projects in Cornwall and has become one of the leading mineral exploration and development companies in the region. The company’s management team has extensive experience in the mining industry and a deep understanding of the geology and mineral potential of the Cornwall region.

The company listed on AIM in February 2021 and today has a market capitalisation of GBP72.6m. The company opened trading today (24th March) at 13.65p. The miner has offered a year-to-date return of -15.6%, a one-year return of -50% with its shares ranging between 12.44p and 28p over a 52-week period.

The company IPO-ed at 7p and raised GBP8m on listing, GBP3m more than expected and the money was used for drilling and exploration at its United Downs copper-tin project and near to South Crofty. At the time, the company believed United Downs was one of the most exciting projects in the UK, given the chance to find the copper, tin and lithium that will be fundamental to the green economy in the form of e-vehicles, battery power and renewable energy.

Today the company maintains South Crofty as its flagship project – located close to the Camborne School of Mines – and in a recent update on the project at the start of this month confirmed the mine as: “…the 4th highest grade tin resource globally, with a mineral resource grade of 1.6% tin equivalent to 4.4% copper at current metals prices.” The other three global strategic tin projects are: Bisie in Democratic Republic of Congo; San Rafel in Peru, and; Renison Bell in Tasmania which are all producing underground tin mines.

Full planning permission

Cornish Metals has authority to develop an underground tin mine at the site, with full surface planning permission to construct a mine water treatment plant, new processing facilities, all necessary site infrastructure, and an environmental permit to dewater the mine valid until 2071.

The miner recently concluded a GBP40.5m funding exercise, which allows the company to push ahead with a feasibility study on South Crofty and  complete a dewatering programme and drilling programme to open underground access and expedite the feasibility study over 30 months. The mine – separated into an upper and lower mine – has a total inferred resource of 37,000 tonnes of tin or tin equivalent and it is targeting a 2026 production date.

The company also has a copper-tin play at United Downs where it has been conducting a drilling programme to explore for copper and other mineralogy and maintains a 100% interest in the 7,642Ha Nickel King property, located in Canada’s Northwest Territories, as well as other North American interests.

Cornish Lithium

Most interesting though is the potential to find high grade lithium in Cornwall. Back in 2017 Cornish Metals entered into a partnership with Cornish Lithium, a privately funded UK-based company, whereby Cornish Lithium has the right to explore for and potentially develop lithium in hot spring brines and associated geothermal energy on all mineral rights held by Cornish Metals in Cornwall.

If Cornish Lithium hits pay-dirt, Cornish Metals will have a 25% free carried interest in the first project to have a Bankable Feasibility Study completed on it, after which Cornish Metals will be required to contribute its share of development costs or its interest will be diluted. Additionally, Cornish Metals will have a 10% free carried interest in each subsequent project that has a Bankable Feasibility Study completed on it, after which Cornish Metals will be required to contribute its share of development costs or its interest will be diluted.

Cornish Lithium is the baby of former fund manager and head of natural resources at Investec, who incidentally did his training at Cranbourne, and last year secured funding from the UK government through the Automotive Transformation Fund’s Scale up Readiness Validation competition to fund the construction of the hydrometallurgical section of a demonstration-scale processing plant at the company’s hard rock lithium project at Trelavour, near St Austell.

If lithium is discovered in commercial quantities in the county, it could become a valuable additional revenue stream for Cornish Metals.

With its focus on high-value metals and its strategic location, we believe Cornish metals is ‘one to watch’ as it is well positioned to play a leading role in the development of the UK’s strategic mineral resources sector at a time when Tin, Copper, Lithium and Nickel are set to power a new industrial revolution and at the same time bring an historic mining area back to life.

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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