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Canyon Resources Ltd

Canyon Resources DSO prospects improved by Cameroon port-rail tendering

Snapshot

A rail line can be diverted to run past Canyon’s flagship Minim Martap Bauxite Project to an expanded deepwater port in Cameroon.

Cameroon map

Quick facts: Canyon Resources Ltd

Price: $0.16

Market: ASX
Market Cap: $70.92 m
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  • Canyon picked up a three-year exploration licence for Minim Martap project in Cameroon in August 2018

  • An independent feasibility study detailed how a diverted rail line from Edea to an expanded port at Kribi could carry direct shipping ore (DSO) from Canyon’s bauxite and silica project

  • The Cameroon Government has been seeking tenders for the rail line and port extensions

What does Canyon Resources do?

Canyon Resources Ltd (ASX:CAY) is an explorer-developer focused on a flagship project in Cameroon.

It is led by founder Phillip Gallagher, a managing director and commercial specialist who has operated in Africa for more than eight years.

Gallagher was previously the MD of Empire Beer Group Limited (ASX:EEE) and was a corporate leader for Foster’s Group Ltd (ASX:FGL) in Western Australia before the Carlton & United Breweries (CUB Pty Ltd; ASX:CUB) successor was sold to British-South African multinational company SABMiller which delisted to then become an Anheuser-Busch InBev SA/NV asset.

What does Canyon Resources own?

Canyon Resources’ key asset is the Minim Martap Bauxite Project in the Adamawa Region of Cameroon on the Gulf of Guinea in Central Africa.

Minim Martap is a bauxite deposit with similar high-grade, low-contaminant properties to other high-grade deposits in Guinea.

Initial high-grade results at the project included up to 54% aluminium oxide and 1.8% silicon dioxide.

Canyon holds a three-year exploration licence for its flagship tier 1 Minim Martap direct shipping ore (DSO) project in Cameroon, which it picked up in August 2018.

The company’s latest presentation on the DSO export project does not name an annual exports target but acknowledges total mineral resources at 14 plateaus at the project are 550 million tonnes grading 45.5% alumina and 2.06%% silica.

Minim Martap’s resource estimate includes a 250 million tonne high-grade resource grading 50.8% alumina and 1.9% silica.

An independent feasibility study this year confirmed the viability of the project by detailing how a rail line from Edea to Kribi Poron could also run past Canyon’s project to Kribi deepwater port south of the coastal city Douala.

Kribi deepwater port can direct ship load Panamax-size vessels and Canyon has rail and infrastructure partnerships with multinational companies Mota Engil Africa of Portugal and Bollore Logistics of France.

A rail assessment by Mota Engil Africa that was reported in March 2019 found the rail line could carry commercial tonnages of bauxite.

As reported last month, Cameroon’s government has now called for tenderers to manage the upgrade of the Edea-Kribi rail line and undertake an extension of Kribi Port.

Canyon has engaged a highly-credentialed and experienced Cameroonian rail engineer to help liaise with the government and rail operators.

In June 2019 Canyon appointed experienced project development manager James Durrant to its DSO project.

Durrant had led technical, social and environmental studies for Danakali Ltd’s (ASX:DNK) Colluli Potash Project and is an experienced operations leader, project developer and technical marketing manager who previously served with BHP Group Ltd (ASX:BHP).

A month earlier Canyon had been buoyed after intersecting high-grade aluminium of up to 50% at Minim Martap.

The company reported in May 2019 it had 70 untested target plateaus and had drill tested less than 35% of the target ground.

Canyon believes it has the opportunity to increase both resource scale and grade at the project.

Inflection points

  • Republic of Cameroon progress on Edea to Kribi Poron rail line and Kribi deepwater port extension tendering

  • Further upgrades to resources at Minim Martap

  • Feasibility study financing and advancement work

  • Financing and partnering milestones

  • DSO, bauxite and silica market sentiments

  • Cameroon mining industry development and government policy support

Canyon managing director Phillip Gallagher highlights infrastructure boon

“It’s pleasing to see the Cameroon Government progressing its rail network to a level that will potentially provide the infrastructure required for Canyon to transport bauxite product from our globally significant project at Minim Martap to the Kribi Port,” Canyon managing director Phillip Gallagher said.

“We will continue to work with the Cameroon government and Camrail to ensure the best possible outcome for the rail network, as it is an important piece in unlocking the potential of our tier 1 bauxite resource at Minim Martap.”

 

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