Alien Metals Ltd (LSE AIM:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer. The company was formed from Arian Silver in late 2018, retaining some of the companies more valuable Mexican projects before embarking on an acquisition led strategy, headed up by an excellent geological team and targeted entirely on Western Australia.
The company now holds a collection of high quality projects within its portfolio, spearheaded by it’s Hancock DSO (direct shipping ore) iron ore project in which it has a 90% holding, through it’s 100% owned subsidiary the Iron Ore Company of Australia (IOCA). In addition to this, the IOCA portfolio consists of the Brockman (90%) and Vivash Gorge (100%) iron ore projects both surrounded by tier 1 tenements owned by major mining corporates such as Rio Tinto and FMG.
Alien’s precious metals exposure comes from the Elizabeth Hill Silver mine (100%), historically Australia’s highest grade silver mine, it’s three Mexican projects of San Celso, Los Campos and Donovan 2, and it’s Munni Munni PGM project (100%). The acquisition of the Munni Munni tenement unified the Elizabeth Hill and Munni Munni projects into a single coherent tenement, under 100% ownership, for the first time in over 30 years.
Munni Munni’s addition to the portfolio in early 2022 marked the end of Alien Metals acquisition strategy and was followed by a slight restructuring via the appointment of Rod McIllree as Executive Chairman and Troy Whittaker as CEO of IOCA, in H2 2022, to better position the company for transition from explorer to producer. Since then the rate of progress towards production has increased drastically inline with the companies new strategy and target of 2023 production.
Alien Metals strategy is a simple one, it is prioritising putting the current 2012 JORC confirmed resource, of 10.4Mt @ 60.4% Fe, at Hancock into production, enabling it to generate an income to fund further exploration and development work, both at Hancock and other projects. This production is to be accompanied by a 100% offtake agreement and will be performed by a single mining contractor to keep costs minimal.
Work at the companies other projects, particularly Elizabeth Hill, continues in the background, so that they are well positioned to be quickly accelerated into production when the the capital from Hancock’s production becomes available. This will allow the company to develop multiple income streams, spread across multiple commodities, protecting it against price fluctuations in a single commodity and thus providing a relatively stable and constant revenue.
Why Alien Metals?
First shipments are expected to leave Hancock in 2023
Direct Shipping Ore
Keeps operating costs down and the mine profitable even at lower iron ore prices
#1 Mining Jurisdiction
Western Australia is the safest and most politically stable jurisdiction globally
The Pilbara produces ~30% of global iron ore and thus has excellent local infrastructure and expertise
The potential for a major discovery to be made within the company’s various project areas is very high. Hancock, the soon to be in production direct shipping iron project in the Pilbara is the most advanced example of this with less than 75% of the overall area having been tested but already hosting more than 10mt of exploitable material
Under new leadership in both the UK and Australia (IOCA) the rate of progress continues to accelerate