ESS (ASX) Thoughts on PIO

Originally posted by w27 ↑

Something which seems to have been missed by posters here is the reference in the last Quarterly Activities Report that there is now an exploration target for microcline of 500,000 to 750,000 tonnes at Sinclair. This probably explains, at least partially, the anomoly that the mining approval is for a mine about 500 metres long and the proposed mine for polucite is only about 130 metres long. The additional length is known to contain microcline and possibly other minerals.
The microcline is valuable high purity and high potassium microcline. PIO have had to undertake special analysis with iron free equipment to determine the purity. Iron is an important contaminant. High quality microcline should return about $200 a tonne at mine gate. The first couple of hundred tonnes would require only crushing as it is already extracted as overburden over the pollucite. Given that it is a near surface deposit the mining and crushing costs should not exceed $15 a tonne. This would be a highly profitable operation.
Given that the microcline has been discovered as a byproduct of exploration for lithium and then pollucite, it is highly likely that there is plenty more there waiting to be located. As far as I can find out the market in the USA is about 5 million tonnes a year. The USA is about 21% of the world economy so the market is quite large and if PIO have a good product they should not have too much trouble carving out a market for what they can produce in the short term. It should give a high margin business with substantial income.
The other interesting comment from the Brisbane conference was from David Crook who said that there was "very little geological risk" on the cobalt laterite at Blair Dome. Most of the geological work there has been done, or at least overseen, by Nigel Brand. He is a very senior geological consultant who is more often seen working for the likes of RIO or BHP. The fact that he spends so much time with PIO is a great recommendation for their projects. We have been promised an exploration target and metallurgical results there for a long time. I think that shareholder will be very pleased with the information when it it finally rleased. David Crook seems confident that Blair has quite extensive deposits of cobalt laterite and the grades there seem to be twice adjacent deposits heavily promoted by others in the same area.

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Good find W27
Note that it also says they are currently progressing with a Maiden resource estimate for the Feldspar which should give us a little more to go on

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Thoughts on PIO, page-21

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