Believing it could become an important part of the boron supply chain is Canadian company Erin Ventures Inc. (TSXV: EV), which is currently developing its Piskanja property in Serbia. The project’s technical report indicates a total of 3.53 million tons of pure B2O3 (Indicated and Inferred), and a near-term catalyst for the company’s share price could come from a Preliminary Economic Assessment (PEA), which Erin Ventures expects to release sometime in the current quarter.
Boron. Most people have likely never heard of this industrial mineral yet it is used in no fewer than 500 products, including nine grams of it in the Gorilla Glass contained in every Apple iPad. It is also utilized extensively in ceramics, fibreglass insulation, fertilizer, silicon, sports equipment, nuclear reactors, lithium batteries, heat shields, and medicines.
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According to the United States Geological Survey (USGS), global consumption of B2O3 (boron trioxide) is projected to reach 2.0 million tonnes in 2014, up from 1.5 million tonnes in 2010. China is currently the world’s largest consumer of boron minerals, with demand increasing by 15% annually from 2000 to 2010.
On the supply side, about 70% of the world’s annual output comes from just two industry players – Rio Tinto subsidiary U.S. Borax with its mine in California, and the government controlled Eti Mine in Turkey. This is due to the fact that economic deposits of boron are so rare.
Believing it could become an important part of the boron supply chain is Canadian company Erin Ventures Inc. (TSXV: EV), which is currently developing its Piskanja property in Serbia. Company President Tim Daniels saw opportunity in Serbia, which has a long, rich history in mining, as far back as 1996 with the collapse of communism in Eastern Europe the late 1980s and early 1990s.
Erin owns 100% of Piskanja, in addition to an exclusive exploration license covering 35 square kilometers of the basin in which the Piskanja deposit is located.
Competitive advantages for the company include a large, high quality ore deposit, ready access to global markets, existing regional infrastructure, and excellent relationships with industry leaders.
In November 2013, Erin Ventures filed a NI 43-101 technical report for Piskanja that established an Indicated Mineral Resource of 1.73 million tonnes of B2O3 (5.6 million tonne ore at 30.8%) and an Inferred Mineral Resource of 1.80 million tonnes B2O3 (6.2 million tonne at 28.8%), which Tim Daniels believes is indicative of an economic deposit. The property has 35kV electricity lines, is accessible by paved road and rail from Belgrade, and the company estimates its operating costs could be as low as $125 per tonne.
Erin’s technical report indicates a total of 3.53 million tons of pure B2O3 (in all categories). However, boron material is sold at 40% purity, so if Erin Ventures has 3.53 million tons of 100% B2O3, it means the company has 8.8 million tons of 40% B2O3 (sale grade).
There is also a potential to expand the resource size as the deposit remains open in two directions. As well, there is the possibility of additional deposits in the remainder of the 35 km2 basin that belongs to Erin. The company expects, as a result of further exploration in the recently announced feasibility work program, that the deposit may grow substantially.
Included in Piskanja’s resource is a variety of borate minerals such as colemanite, which is a key ingredient in glass production, especially heat, scratch and impact -resistant glass such as fibreglass, and borosilicate glass (TV and device screens).
Turkey is currently the only significant exporter of colemanite and thus it presents a potential opportunity for Erin Ventures, as there seems to be an appetite amongst colemanite consumers for either an alternative or supplementary supplier, this according to Mr. Daniels.
“We’re looking at (a boron) market penetration that equates to about 5% and there’s certainly a hole in the market for that sort of penetration, or more, from a good quality, low cost producer,” he said, adding that the company has been in discussions for the past two or three years with several different potential strategic partners or companies willing to enter into off take agreements, which includes some of the world’s largest borate buyers.
As part of its efforts to fund its feasibility study (the next step on the way to a mine license) and turn this project into an operating mine, Erin Ventures on May 12, 2014, proposed, subject to approval by Canadian regulators, a unique hybrid investment vehicle with a royalty and share component in order to raise up to $5 million. Mr. Daniels believes this is the most cost effective course of action for the company and its shareholders given what he considers to be the project’s high cash flow potential along with its high gross margins.
For Erin Ventures’ investors, then, a near-term catalyst for its share price could come from a Preliminary Economic Assessment (PEA), which the company expects to release sometime in the current quarter.
To learn more about Erin Ventures Inc., you can view their initiation research report, research bulletins, analyst commentaries and CEO video interview on their SmallCapPower.com Investor Hub: Here
About Erin Ventures:
Erin Ventures Inc. (TSXV: EV) is an international mineral exploration and development company with boron assets in Serbia. Headquartered in Victoria, B.C., Canada, Erin’s shares are traded on the TSX Venture Exchange under the symbol “EV”.
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