Interview with Fabian Baker, MD of Kingsrose Mining Ltd.
Our previous interview: https://www.cruxinvestor.com/posts/kingsrose-mining-krm-bhp-backed-team-scandinavian-nickel-assets-cash-2952
Recording date: 22nd May 2024
Scandinavian-focused explorer Kingsrose Mining (ASX:KRM) has emerged as a compelling battery metals investment opportunity following the announcement of a landmark exploration alliance with global mining giant BHP. The deal will see BHP sole fund up to US$30M over four years for Kingsrose to explore for new nickel and copper discoveries in the highly prospective but underexplored regions of Finland and Norway.
The alliance adopts an innovative three-stage structure which aligns the interests of both parties while overcoming many of the drawbacks of typical junior-major joint ventures. BHP can earn up to a 75% stake in selected projects by sole funding an additional US$36M, but Kingsrose will retain majority ownership and operatorship of any projects BHP does not earn into. This provides Kingsrose with substantial funding to undertake systematic regional exploration for battery metals, with no near-term dilution and significant project-level control and upside.
The BHP deal evolved out of Kingsrose's participation in the major's "Xplor" accelerator program which sought to combine the agility and technical capabilities of high-quality juniors with the funding and expertise of a major to drive new discoveries. Kingsrose was one of just seven companies globally selected from hundreds of applicants, underlining the strengths of its technical team and geological concepts.
In parallel with the BHP alliance, Kingsrose is advancing two high-grade, 100%-owned projects in Scandinavia. The Penikat PGE project in Finland hosts a 25km outcropping zone of shallow, high-grade mineralization with multi-million ounce potential. Kingsrose is finalizing permits for first drilling after recently completing key environmental surveys.
In Norway, Kingsrose is earning up to 80% of the Råna nickel-copper project, which covers a formerly producing high-grade mine with very limited modern exploration. Initial drilling has hit significant new zones of massive sulfides outside the historic mine, with a 1.6km prospective horizon and multiple untested EM conductors highlighting the potential.
The combination of advanced, 100%-owned projects and the BHP-backed exploration initiative positions Kingsrose as one of the ASX's most attractive pure-play battery metals explorers. With a market cap of just $40M and around $10M in cash, the company appears significantly undervalued given the scale of its opportunity and the backing of the world's largest miner.
Europe's rapidly growing need for local, secure supply of the raw materials crucial to the energy transition is expected to put a strong premium on projects which can meet this need. Kingsrose's assets in the Tier-1 mining jurisdictions of Finland and Norway are strategically located to supply the European battery supply chain, with excellent infrastructure, low sovereign risk and strong government support.
Led by a proven management team and now with the financial backing and technical endorsement of BHP, Kingsrose is well placed to deliver significant shareholder value as it builds a leading battery metals exploration business. With multiple near-term catalysts expected from both its wholly-owned projects and the BHP alliance, Kingsrose stands out as a compelling investment opportunity in the high-growth battery metals space.
View Kingsrose Mining's company profile: https://www.cruxinvestor.com/companies/kingsrose-mining
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What is Company Interviews?
An insight into junior mining and opportunities to invest.
Company Interviews, a Crux Investor show, exists to cut through the jargon, bias and bluster.
Matthew Gordon, and guest host Merlin Marr-Johnson hone in on the important factors that indicate a company's strong footing for growth and success.