Tin producer Metals X (ASX:MLX) releases its quarterly report today.
MLX has a 50% stake in a joint venture to mine the Renison tin deposit in Tasmania.
Total production for the quarter was 2,809 tonnes of tin concentrate. That was approximately 2.7% lower than the previous three months but a higher tin price helped offset this.
Tin is proving profitable for Metals X, with the company receiving a tin price of $73,824 per tonne, up 5.9%, while reporting an all-in sustaining cost (AISC) of $34,865 per tonne.
Imputed earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the quarter stood at $125.9 million.
Cost inflation is becoming a closely watched metric for resource investors.
Metals X’s report states, in part:
“Total operating costs increased against the prior quarter, reflecting increased underground rehabilitation, mine drainage and mine services costs, major parts replacements and repairs across the mobile fleet, higher fuel prices, and additional crushing and processing circuit costs. Together with the lower production, this increased the unit cost per tonne of tin-in-concentrate produced for the quarter.”
Regardless, the company’s cash balance increased by $14.92 million to $374 million, and the quarter also included a major tax payment, mine capital expenditure, plus investments in other tin projects.
One of those investments is in a tin explorer called Stellar Resources (ASX:SRZ).
Stellar Resources is also located in Tasmania.
Stellar’s management says the company’s flagship Heemskirk Tin Project is the highest grade of undeveloped tin resource in Australia and the third highest globally.
Metals X invested $17.54 million into Stellar over the last three months. MLX was the cornerstone investor in the Stellar capital raising to progress Heemskirk. MLX holds 16.39% of SRZ’s issued capital.
Metals X is also diversified into other tin projects, including 15.91% of issued shares in Elementos (ASX:ELT).
The quarterly report states:
“This investment provides Metals X with the opportunity to participate in a global pipeline of developing tin projects, allowing the company to contribute its operational expertise to support their advancement, and Metals X has nominated Brett Smith and Daniel Broughton to the Elementos board.”
Should the tin price remain this elevated, both Stellar Resources and Elementos should have financing and market support readily available for their respective projects.
Write to Callum Newman at Mining.com.au
Images: Elementos
