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MONTHLY UPDATE
Lowell Resources Funds Management Ltd. ABN 36 006 769 982 AFSL 345674 | December 2021 | |
December 2021 Performance Summary:
Lowell Resources Fund (ASX: LRT)
The Lowell Resources Fund net asset value ('NAV') at the end of December 2021 was approximately $57.2m, compared to $57.1 million at the end of November.
The NAV per unit finished the month of December at $1.948/unit (vs $1.948/unit at 30 November 2021). The traded unit price of the ASX listed LRT units at month end was $1.75/unit. A further 54,789 units were issued as part of the DRP during the month (required as a result of some unit holder bank account details for cash distributions for year ended 30 June 2021).
For personal
FUND OVERVIEW
Investment | Lowell Resources Funds |
Manager | Management Limited |
Managed since | 6 February 2004 |
ASX code | LRT |
Income | Annual |
distribution |
FUND SNAPSHOT 31 December 2021
NAV per unit | $1.948 |
No. of Units on issue | 29,354,614 |
Market Price (ASX) | $1.75 / unit |
Net Asset Value | $57.2m |
August 2021 Distribution | $0.15/unit |
Market Capitalisation | $51.4m |
Lowell Resources Fund NAV vs | |
3.50 | ASX Junior Resources Index |
3.25 | (rebased to 1 at December 2019) |
3.00 | |
2.75 | |
2.50 | LRT |
2.25 | |
NAV | |
2.00 | |
1.75 | |
1.50 | |
1.25 | |
1.00 | |
0.75 |
For personal use only
MONTHLY UPDATE | ||
December 2021 | ||
Lowell Resources Funds Management Ltd. LRT
Fund Investment Actions - December 2021
In precious metals, the Fund boosted its holdings in ASX listed Australia-focused explorers Genesis Minerals, Great Northern Mining and Kingwest Resources.
In base metals, the Fund completed its very profitable exit from Centaurus Metals, as the company advances its feasibility studies on the Jaguar nickel sulphide project in Brazil.
In December, the Fund added to its position in ADX Energy, which is developing both conventional hydrocarbons as well as hydrogen-focused projects in Austria.
LRF COMMODITY EXPOSURE 31 DECEMBER
2021
Bauxite | Uranium Helium | |||
0% | ||||
1% | 3% | |||
Mineral Sands | Fertilisers | Mining Services | ||
1% | 0% | |||
Cash | 3% | |||
7% |
Nickel
7%
Battery
4%
Gold & PGM
O&G50% 8%
Base Metals
14%
Silver REE
1% 1%
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MONTHLY UPDATE
Lowell Resources Funds Management Ltd. LRT
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Fund Top Holdings | ||
Predictive Discovery (PDI.ASX) continued to | ||
extend the depth of its 3.6Moz NE Bankan gold | ||
deposit in Guinea, west Africa, with intercepts such | ||
as 34m at 5.5 g/t Au from 441m. It also released | ||
aircore drill results from new prospects including | ||
use | 36m at 1.9g/t Au at the 800W zone and 22m at | |
12.1g/t Au at the SW Bankan area. | ||
Musgrave Minerals (MGV.ASX) announced new | ||
shallow high grade lodes at its 100% held Cue | ||
project in WA, including 15m at 111g/t Au. High | ||
grades were also returned from the Big Sky deposit | ||
including 4m at 20g/t Au. | ||
personal | De Grey Mining (DEG.ASX) announced extension | |
of the Diucon deposit to 550m depth, and high | ||
grades at the Eagle deposit (53m at 5.8 g/t Au) at | ||
the 9.0Moz Mallina gold project. | ||
Azure Minerals (AZS.ASX) announced a new | ||
discovery at the Skyline prospect at its 60% owned | ||
Andover project in the Pilbara, WA. Assays are | ||
awaited from multiple intersections of disseminated | ||
Ni-Cu sulphides. At the VC-07 East deposit | ||
mineralization was extended to at least 550m | ||
depth. | ||
Blue Star Helium (BNL.ASX) announced it had | ||
received the long awaited approval for a permit to | ||
drill the Enterprise helium well in Colorado. | ||
Significant gas columns have been interpreted in | ||
water wells at the Enterprise and Voyager | ||
prospects, with up to 8.8% helium content | ||
calculated. | ||
For | Fund Top Performer | |
Golden Rim Resources (GMR.ASX) share price | ||
rose 41% in December. GMR is completing | ||
resource drilling at the Kada project in Guinea, west | ||
Africa, where the company is earning a 75% | ||
interest. Best results include 96m at 3.3 g/t Au. An | ||
initial resource is expected in Q1 2022. | ||
December 2021
LRF Portfolio Value by Project Stage |
31 December 2021 |
70% |
60% |
50% |
40% |
30% |
20% |
10% |
0% |
Company | Commodity | % of Gross | |||||
Investments | |||||||
Cash | Cash | 6.7% | |||||
Predictive | Gold | 8.6% | |||||
Discovery | |||||||
Genesis Minerals | Gold | 6.9% | |||||
Musgrave | Gold | 6.6% | |||||
Minerals | |||||||
De Grey | Gold | 4.9% | |||||
Mining | |||||||
Azure Minerals | Nickel | 3.9% | |||||
Caravel | Copper | 3.5% | |||||
Talon Metals | Nickel | 3.3% | |||||
Blue Star Helium | Helium | 2.8% | |||||
South Harz | Potash | 2.5% | |||||
Potash | |||||||
Red Dirt Metals | Lithium | 2.3% |
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MONTHLY UPDATE | ||
December 2021 | ||
Lowell Resources Funds Management Ltd. LRT |
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Performance Comparison - December | |||||||||||||||
2021 | |||||||||||||||
Over the past 12 months, the Lowell Resources Fund's change in underlying net asset value per unit | |||||||||||||||
(inclusive of distributions and after fees and expenses) was 36.4%, and 85.1% pa over two years. The | |||||||||||||||
Fund has outperformed the benchmark S&P/ASX Small Resources Index (XSRD) and the ASX 200 | |||||||||||||||
use | Index over one, two, five and ten years. | ||||||||||||||
Total Portfolio | LRT Change in | S&P/ASX Small | ASX 200 Index TR | ||||||||||||
Performance to 30 | NAV per unit incl | Resources Index | |||||||||||||
December 2021 | distributions | (XSRD) | |||||||||||||
12 months | 36.4% | +27.5% | 17.2% | ||||||||||||
2 years p.a. | 85.1% pa | +24.3% pa | 9.0% pa | ||||||||||||
personal | |||||||||||||||
5 years p.a. | 23.7% pa | +13.3% pa | 9.8% pa | ||||||||||||
10 years p.a. | 15.4% pa | -2.0% pa | 10.8% pa | ||||||||||||
The LRT.ASX traded unit price at the end of December was $1.75/unit, compared to $1.80/unit at the end | |||||||||||||||
of November. | |||||||||||||||
Market Notes | |||||||||||||||
• U.S. inflation hit a 39 year high of 6.8% in November, on the same day the S&P 500 equity index | |||||||||||||||
hit its 67th all-time high of 2021. The US Federal Reserve announced it would end its asset- | |||||||||||||||
buying program earlier, and signaled it favours raising interest rates in 2022 at a faster pace than | |||||||||||||||
expected. Elsewhere, the Bank of England raised rates to 0.25% from historic lows of 0.10% amid | |||||||||||||||
reports of improving labour market and strong inflation. Early in December, the US jobless claims | |||||||||||||||
dropped to the lowest level since 1969. | |||||||||||||||
For | • Supply chain bottlenecks continued to impact markets. As at 13 December, a record 101 container | ||||||||||||||
ships were queueing off Los Angeles and Long Beach ports. | |||||||||||||||
• | US President Joe Biden still requires the support of key Democrat Senator Joe Manchin to pass | ||||||||||||||
his US$1.7tn "Build Back Better" stimulus plan. Manchin has refused to vote for the spending plan | |||||||||||||||
citing the risk of cost blow outs and its effect on inflation. | |||||||||||||||
• US$ gold finished the 2021 calendar year at US$1,820/oz, up 2.5% on the month, but down from | |||||||||||||||
US$1,890/oz over the year. | |||||||||||||||
• Real US interest rates dropped back below negative 1.0%, before beginning to rise in the new | |||||||||||||||
year. | |||||||||||||||
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For personal use only
MONTHLY UPDATE | ||
December 2021 | ||
Lowell Resources Funds Management Ltd. LRT
- Oil prices bounced back as the Omicron variant was assessed by various medical authorities as "mild". Overall, oil was up around 60% for the 2021 calendar year, with Brent peaking at US$86/bbl in November. OECD oil inventory has been falling for 2 years and is back at levels not seen since 2012.
- Henry Hub, the US natural gas benchmark, was softer as milder weather in North America prevailed (with lethal tornadoes hitting the US Midwest).
- Discoveries of new oil and gas supplies are set to plunge to their lowest annual level in 75 years amid a broader trend of falling investment, triggering volatility in crude prices. With no major finds in December, the industry is on course for its worst discoveries total since 1946, consultancy Rystad said. The Covid-19 crisis sparked the biggest fall in global energy investment in history, plummeting 20 per cent or $US400bn in 2020.
- European gas prices spiked to records as operations permitting for the completed Nord Stream 2 pipeline, built to supply gas from Russia to western Europe, was blocked, in part due to the escalation of tensions in Ukraine. This prompted diversion of US LNG vessels bound for Asia back towards European ports and the first shipment of Australian LNG to Europe in more than a decade. As in continental Europe, UK gas prices have risen roughly 650% since the start of the year, bankrupting more than two dozen domestic energy suppliers. Gas accounts for about 40% of UK electricity generation and heats the majority of homes. High gas prices are impacting global production of fertilizer, and more locally the supply of diesel fuel additive Adblu. German power prices have also increased to a record high while French power prices jumped to a decade high.
- In Australia Woodside Petroleum announced a plan to supply the east coast markets with gas from Western Australia by shipping LNG from WA to a planned import terminal in Victoria's Geelong. The value of Australia's LNG shipments has almost trebled within 12 months as soaring international prices for gas give a massive boost to export revenue, but also present problems for Australia's east coast manufacturers. Australia's LNG export sales rose to $5.77 billion in November, up about 196 per cent on the same month last year. Asian LNG spot prices have been holding above $US30 per million British thermal units for several months, around 15 times levels in the June quarter last year, according to EnergyQuest.
- The copper supply outlook was threatened by MMG's announcement early in the month that it would shutter the Las Bambas mine in Peru in December, due to local community blockades of road supplies. Communities are pressuring the company for more jobs and a larger share of revenue. Las Bambas produces around 2% of the world's copper supply. This coincided with a rise in nationalism in the world's no.2 copper producer. At the end of December, it was reported that the road blockade had been cleared and would resume operation.
- Gabriel Boric, a left wing 35-year-old former student leader won the Chilean presidency. Boric said he would oppose mining initiatives that "destroy" the environment. That included the contentious $2.5bn copper, gold and iron Dominga mining project approved in August. One of Boric's proposals is to create a national lithium company, although a complexly divided congress will be a significant hurdle.
- Chinese copper concentrate imports rose 21.9% in November to a record 2.19mt.
- Rio Tinto announced the write off of $2.3bn of debt which it loaned to the Mongolian government for the Oyu Tolgoi copper mine. Rio will now meet all development costs, and hopes the deal will allow commissioning of the underground operation of the mine in H1 2023. Once complete, Oyu Tolgoi will be one of the biggest copper mines in the world, producing almost 500,000 tpa of the metal.
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Lowell Resources Fund published this content on 13 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 January 2022 03:40:08 UTC.