Less than a month after cementing ownership of the Cummins Range rare earth element project in Western Australia, Sagon Resources (ASX: SG1) has debuted what it calls a “globally significant” maiden resource for the asset, which it claims is equivalent to more than 147 million kilograms of total rare earth oxides (TREO).
The maiden inferred resource for Cummins Range totals 13Mt at 1.13% TREO for the 147Mkg of contained material at a 0.5% TREO cut-off.
According to Sagon, this places the Cummins Range resource above advanced REE explorer Northern Minerals’ (ASX: NTU) Browns Range development in terms of tonnage and grade.
Lynas Corporation’s (ASX: LYC) Mt Weld asset is the most advanced WA REE operation with a resource of 55.4Mt at 5.4% TREO.
The only other two ASX-listed REE projects Sagon places itself behind include Arafura Resource’s (ASX: ARU) Nolans Bore asset and Hastings’ (ASX: HAS) Yangibana with both these companies also possessing much larger market caps to Sagon.
As the only commercial REE miner in Australia, Lynas has a market cap of around $1.8 billion. In comparison Northern Minerals’ market cap is $142 million, while Sagon’s is a mere $16 million.
Growing Cummins Range
Sagon executive director Jeremy Robinson said the maiden resource not only benchmarks Sagon against its peers, but offers the company an “exciting platform” to expand, pointing out that the Cummins Range orebody remains open along strike and at depth.
“We believe we can materially expand the resource and look forward to the upcoming drilling program,” Mr Robinson added.
Stage one drilling will comprise a number of large diameter PQ drill core to extract samples for metallurgical testings.
In the interim, Sagon is continuing to collate and review previous data which will be compared against the upcoming passive seismic survey to identify drill targets to expand the resource.
Sagon anticipates the Cummins Range orebody is amenable to simple low strip open pit mining, with mineralisation extending from surface with an average width of 25m.
REE critical minerals
With the majority of REE produced in China and the material crucial to much of modern technology, REE have been deemed critical by a number of countries.
The trade conflict between the US and China has exacerbated the issue – prompting US President Donald Trump to meet with Australian Prime Minister Scott Morrison last month.
The meeting resulted in the duo signing off on a plan for the US to lock-in stable REE supplies from Australia.
Sagon expects to take advantage of this situation with Cummins Range.