Early interest in Globe Metals’ fluorspar property

Tania Winter
MiningNews.Net

WHILE its early days for Globe Metals & Mining in Mozambique, interest is growing in its Mount Muambe fluorspar property, but rather than advance potential partner talks, drilling is the more immediate focus.

The company first formed a joint venture to earn a 90% interest in the property in October last year and surface trenching has produced high grades. Recent rock chip results included a peak grade of plus 76% calcium fluoride with an average grade of 58% calcium fluoride returned from 26 samples. Fluorspar is a mineral composed of calcium fluoride and accounts for more than 90% of the world’s consumption of fluorine. Acid-grade fluorspar is more than 97% calcium fluoride and metallurgical grade is less than 97% calcium fluoride in purity.

Acidspar accounts for 65-70% of world production, although this varies considerably from country to country, with South Africa, for example, producing 95% of acidspar from its mined fluorspar.

Globe Metals is now getting on with the job of drilling Mount Muambe to assess its economic potential. "It really makes no sense to contemplate a transaction prior to completion of the drill program" Globe Metals executive chairman Mark Sumich said.

Globe Metals intends to start an initial 1000m drilling program in the second quarter. However, the main focus of the company is the Kanyika niobium project, located across the border in central Malawi, where a bankable feasibility study (BFS) is due for completion later in the year. The company is targeting production to start in 2012 at the rate of 3000 tonnes per annum niobium metal, principally in the form of ferro-niobium, over a 20-plus year life. In August last year, Globe announced that South African company Thuthuka Group, was earning a 25% stake in the project by spending $US10.6 million ($A11.76 million), which would effectively cover around 85% of the estimated cost of the BFS. In terms of fluorspar, a dominant theme in this market globally, similar to rare earths, is the prevalence of Chinese production and consumption.

Of the estimated 5.5Mt of global fluorspar produced in 2009, China accounted for more than 50% and was also the largest single consumer. In order to preserve its own production, Chinese authorities have put in place production restrictions, a “scarcity” tax where the resource tax for fluorspar has been increased to 15%, and looked to close down small and inefficient producers. The price of spot acidspar (China free on board) rose from $US130-140/t in January 2003 to $US530-550/t in December 2008, and is currently at $US250-270/t.

Shares in the company were unchanged in late afternoon trade at A22c.