The Havilah Resources Ltd (ASX: HAV) share price has jumped out of the gate on Friday.

At the time of writing, the ASX mining share is trading 28.57% higher at 36 cents following a company announcement this morning.

The gains bring its total return to more than 100% over the past three months.

While the announcement itself isn't price sensitive, its contents in some ways are, seeing as it relates to the potential disposal of a key asset.

In broad market moves, S&P/ASX 300 Metals and Mining Index (ASX: XMM) is currently down 0.25%.

What's up with this ASX mining share?

Pending the final transaction of its deal with OZ Minerals Limited (ASX: OZL), Havilah advised today that it will hold a general meeting for shareholders on 31 August.

Recall that Havilah and OZ announced back in May the pair had signed a term sheet granting the latter an option to buy the Kalkaroo copper-gold-cobalt project.

The duo then signed definitive agreements on 26 July. However, there's one final step left in the process and that's to seek approval from the company's shareholders.

Havilah's board supports the proposed transaction as it believes the $205 million offer "produces a significantly better financial outcome and lower risk alternative" than if it were to mine the Kalkaroo deposit itself.

In today's release, it said:

The contingent consideration, of up to $200 million, [also] provides Havilah with exposure to future Kalkaroo Project upside in the event of mineral resource upgrades and/or copper prices above US$10,000 per tonne.

The Strategic Alliance is a potential catalyst for development of a major new copper mining region in the northeast of South Australia on Havilah's extensive tenement holdings in the Curnamona Province.

The market has certainly voted in favour of the announcement today and shares have spiked on a volume approximately seven times that of the four-week average.

In the past 12 months, the Havilah share price has gained around 69%.

The post Obscure ASX mining share surges 29% following OZ Minerals copper deal update appeared first on The Motley Fool Australia.

The Havilah Resources Ltd (ASX: HAV) share price is roaring upwards on news of an acquisition agreement and a strategic alliance.

At the time of writing, the Havilah Resources share price is 33.5 cents, 97% higher than its previous close. However, it hit a multi-year high of 45 cents earlier today, representing a 164.7% surge.

Let's take a closer look at today's news from the copper, gold, cobalt, rare earth elements, and uranium explorer.

Why is the Havilah Resources share price flying?

The Havilah Resources share price is rocketing after the company announced its plan to allow OZ Minerals Limited (ASX: OZL) to acquire the Kalkaroo copper-gold project in South Australia for $205 million.

Oz Minerals has 18 months to decide if it will fork out the cash for what is potentially one of Australia's largest undeveloped open-pit copper deposits. In that time, it will be conducting a study program on Kalkaroo.

The project currently boasts a mineral resource of 1.1 million tonnes of copper, 3.1 million ounces of gold, and 23,200 tonnes of cobalt.

Oz Minerals can back out of the agreement as long as it's drilled at least 5,000 metres at the project. Otherwise, it will be forced to pay a shortfall of $400 for each metre not drilled.

The agreement also includes a potential $65 million consideration payable if the project's resource estimate increases by 30%.

Another annual contingent payment is linked to the price of copper. It is valued up to a cumulative $135 million, subject to inflation metrics.

Additionally, a strategic alliance between the pair will help Havilah Resources fund a major copper exploration campaign.

The alliance will run for the duration of the 18-month option agreement.

It will see Oz Minerals paying Havilah Resources $1 million each month, with 50% of that going towards exploration at the Curnamona Copper Belt.

The acquisition plan will be subject to Havilah Resources shareholder approval. The company expects it will be put to a vote in August.

Its directors have recommended the transaction, subject to an independent expert ruling it's in shareholders' best interests.

What did management say?

Havilah Resources technical director Dr Chris Giles commented on the news driving the company's share price sky high, saying:

[The] strategic alliance with OZ Minerals … aims to harness the respective skills of both companies to explore and develop Australia's next great copper region in the Curnamona Province.

Exercise of the Kalkaroo option by OZ Minerals would result in monetisation of Kalkaroo and provide what we believe is a fair return for our shareholders without Havilah taking on the longer-term development and financing risks inherent in a large new mining project at this time.

The post Boom! Here's why the Havilah Resources share price just exploded 165% appeared first on The Motley Fool Australia.

The OZ Minerals Limited (ASX: OZL) share price jumped nearly 2% in early trade on news it has an option over what could be Australia's largest undeveloped open pit copper-gold deposits.

Management announced it had signed a binding term sheet with explorer Havilah Resources Ltd (ASX: HAV).

The term sheet gives OZ Minerals the option to acquire 100% of the Kalkaroo project. It also sets the basis for a strategic partnership between the miners in the prospective Curnamona Province in South Australia.

The OZ Mineral share price isn't the biggest winner

The OZ Minerals share price rallied to a high of $21.85 before settling down to trade 0.75% higher at $21.62 at the time of writing.

But it's the Havilah share price that saw most of the action. It surged 164% to 45 cents this morning. At the time of writing, it's settled at 32 cents a share, 88% higher. The term sheet is material to the mining junior as OZ Minerals will pay $1 million a month to Havilah for the period of the term sheet.

Half of the payment will be used by the explorer to identify and advance nearby exploration opportunities in the Curnamona Province.

Details of the term sheet

Further, OZ Minerals is committed to spending another $76 million on exploration at the Kalkaroo project and on partnership activities.

In return, the S&P/ASX 200 Index (ASX: XJO) miner has up to 18 months to decide if it wants to buy the Kalkaroo project for $205 million.

Earnout component pushes acquisition cost to a max of $135m

It will have to pay Havilah another $65 million upon a 30% uplift in Kalkaroo's Measured and Indicated Resource estimate. This is as well as a copper price-linked contingent payment in each year of production up to a maximum cumulative amount of $135 million.

Kalkaroo's Mineral Resource estimate of 245Mt @ 0.45% Cu and 0.39g/t Au was announced by Havilah in 2018.

OZ Minerals chief executive Andrew Cole said:

The agreement provides a low-cost option and flexibility to study the Kalkaroo project, while retaining the optionality to acquire 100% of the project for a fixed acquisition price together with any deferred contingent consideration.

We believe our approach of taking projects from an early study phase through development and into operation can unlock significant value for our stakeholders, something we have demonstrated with Carrapateena, now in its third year of operation, and continue to show with West Musgrave as we approach a final investment decision on the project later this year.

OZ Minerals share price still in the red

Shareholders will be hoping that the deal will help turn sentiment towards the OZ Minerals share price. Its shares have fallen more than 12% over the past 12 months while the ASX 200 has gained around 1%.

Meanwhile, the Havilah share price has been saved by today's jump. Its shares were wallowing around a more than one-year low but are now around 17% ahead over a 12-month period.

The post Oz Minerals share price rallies on potential $200m acquisition appeared first on The Motley Fool Australia.

The prices of commodities such as iron ore, oil, gold, lithium and copper are notoriously hard to forecast over the short or long term.

For example, back in mid-2016, Goldman Sachs infamously slashed its coal price forecast and warned investors off coal right before its price went absolutely gangbusters for the next two years. 

However, cobalt investors have some good news today if the analysts at UBS are on the money about the cobalt price direction over the next year.

According to a Reuters news report, UBS is forecasting a 60% climb for cobalt prices over the next 18 months to US$20/lb, due partly to the closure of a Glencore cobalt mine in the Democratic Republic of Congo. The article also reports that cobalt prices could move even higher by 2024–25 due to a supply deficit. 

The ASX has dozens of micro- and small-cap cobalt miners and prospectors looking for a cobalt cash-in, with some of the more popular ones including Clean Teq Ltd (ASX: CLQ), Havilah Resources Limited (ASX: HAV), Cobalt Blue Holdings Ltd (ASX: COB), Jervois Mining Limited (ASX: JRV) and Australian Mines (ASX: AUZ).

Both cobalt and lithium are key ingredients in the batteries required to power electric vehicles, while cobalt is also commonly used in the batteries to power increasingly popular everyday electronic items such as laptops and iPhones.

The story is attractive on first blush, but whether any of these companies can turn rising demand into free cash flow and returns for shareholders is another story. 

Still, if UBS is on the money, these stocks could enjoy a strong 2019 and 2020.

The post UBS forecasts cobalt price to climb 60% over 18 months appeared first on The Motley Fool Australia.