Street TalkAnglo American an answer for Chalice’s capex...

Street Talk
Anglo American an answer for Chalice’s capex bill
Chalice Mining’s admission it’s auditioning minority investors for its Gonneville development had fingers pointing to London-listed mining juggernaut Anglo American as a potential bedfellow.Anglo American is best known Down Under for its coal mines in Queensland’s Bowen Basin, but it has been picking up exploration ground in Western Australia for copper, nickel and the like.It wouldn’t be surprising to see it pop up in Chalice’s offices (or its shareholder register), especially as the latter pitches Gonneville as the largest nickel sulphide discovery worldwide since 2000 and the largest platinum group element discovery in Australian history.While Chalice was quick to talk early interest from large international trading houses, downstream battery and auto manufacturers, market sources reckoned Anglo American could be regarded as an early favourite.Anglo American, listed in London with a £35 billion ($69 billion) market cap, is already a major producer of platinum group elements in South Africa, so should have some of the ” technical expertise, market familiarity and financial strength” Chalice said it was after, and is always on the lookout.However, analysts and investors reckon it is unlikely to be instant infatuation. They think any potential Gonneville suitor would likely wait until the scoping study comes out, later this year.While Chalice has hefty mineral resource estimates for the project and a $1.6 billion market capitalisation to boot, it’s yet to give the market a read on the discovery’s economic potential. In other words, there’s no knowing how rich it could make investors.The first indication of that would be in the scoping study, for which Chalice is looking at a broad range of scenarios ranging from smaller developments to much larger ones. It would be early numbers but should give both side a feel for what Gonneville is worth.Investors said Chalice is well funded to get the scoping study done, but would likely want an experienced and deep-pocketed miner to help it go towards production.The other name being tossed around was BHP, whose interest in copper and nickel miner Oz Minerals has investors trying mid-sized resources plays for fit with the Big Australian.