Something to put on the radar: You can expect a jump in the share price of companies like AVZ and 4CE given the recent announcement by a Chinese company to pump $400 Million into improving road infrastructure around their tenements in the DRC.
Why is this important? Well, firstly it’s a huge vote of confidence for the potential of mining in that region (ie they believe that there is a business case to justify the investment), and for an explorer like AVZ, it all but confirms that they have a resource that is worth mining and one that Chinese investors believe will be (become) significant over a long period of time.
The latter should put to rest the doubts around the potential of Manono for those that think it won’t be dug up, and isn’t significant. It will be dug up (likely by someone else who is not the current owner) it’s just a matter of when. And my suspicion is that one of those major players (who need scale in order to operate efficiently) will aggressively advance the project timeline by throwing a ton of money at it to get it up to speed quickly. We wait and see.
Two final thoughts.
1) In many ways, this announcement is more significant for a smaller player like 4CE. Given their relative size, this sort of infrastructure spending gives them a significant strategic advantage and a real chance to accelerate their operations dramatically.
2) And, AVZ is drilling in a week, so you can expect some further excitement. As per previous comments, AVZ is a bit of a magnet for the lithium sector and drives some of that ‘rising tide’ mentality we’ve been seeing of late, so there might be in-flows across the sector if their results are good.
