Mustang to be re-named “New Energy Minerals Ltd” to reflect its focus on the worldclass Caula Vanadium-Graphite project in Mozambique.
In July 2018, the Company announced the merger of its ruby assets with Fura Gems Inc. (TSXV: FURA), for the consideration of AU$10 million in Fura shares over three tranches and an AU$25 million spending commitment to be allocated to the enlarged Fura ruby project, subject to exploration results. This transaction (subject to final closing by 30 November 2018) relieves the Company of the substantial exploration and market development expenditure required in coming years, to establish the Company’s ruby interests as a commercial ruby mining operation.
Importantly, the Fura transaction has allowed the Company to focus its attention and capital on a world-class asset, the Company’s 80% owned Caula Vanadium-Graphite project, next to Montepuez and directly along strike from and due north of the graphite project owned by Syrah Resources Limited (ASX:SYR, AU$731 million market cap).
According to Mustang Board of Directors, this is the optimal available strategy for the company, given the strong demand for vanadium and large-flake graphite, coupled with the exceptional results from Caula in the year to date.
The new name proposed for approval by shareholders under resolution 12 of the Notice of Meeting, “New Energy Minerals Ltd” (ASX:NXE), reflects the Company’s focus on the development and mining of two geologically associated commodities from the same deposit; both essential to the production of electric vehicles and the storage of renewable energy. With Graphite being used in lithium-ion batteries and Vanadium used in vanadiumredox-flow-batteries, both commodities also have traditional applications in the steel industry, a mainstay of global economic development.
It is the use of vanadium as a steel-strengthening alloy and new Chinese rebar standards, which have increased its price more than 500% in the last 2 years to current levels of US$18.40/lb (US$40,480/tonne), with primary vanadium pentoxide flake supply only being delivered by a handful of companies including Largo Resources Ltd
(TSX: LGO, C$1.46 billion market cap) and Glencore PLC (LN: GLEN).