The Sovereign Metals Limited (ASX: SVM) share price struggled to hold onto its gains today after surging 11.6% higher this morning to 71.5 cents. At market close, shares in the rutile explorer were sitting at 65 cents, up only 1.56%.

The company announced a broker briefing presentation this morning, which might have influenced the rally this morning.

What was announced?

The Sovereign Metals share price enjoyed a strong rally this morning after the explorer advised it has in its possession a "company making asset" in the Kasiya rutile deposit in Malawi.

Previously, on 9 June, Sovereign Metals released a maiden resource estimate for Kasiya, with assay results revealing 644 million tonnes at 1.01% rutile, including 137 metric tonnes at 1.41% rutile.

The positive announcement witnessed the Sovereign Metals share price surge 13% on the day to a record close of 77 cents.

According to today's presentation, the company is accelerating its work programs in order to meet key short-term objectives at Kasiya.

This includes aggressive drilling programs to drive additional resource growth and extensions, as well as a scoping study, which is expected to be completed in late 2021.

While the Kasiya deposit is still in an exploration phase, the company highlighted Malawi as a "stable, transparent jurisdiction" with "operation-ready infrastructure".

In addition, Sovereign Metals has a memorandum of understanding in place with rail and port operators to, in the future, export to global rutile markets.

Sovereign Metals share price rallies in 2021

The Sovereign Metals share price has rallied by more than 75% year to date.

The company believes there is "the perfect storm" to support rutile prices in both the short, medium and long term.

It pointed to factors including, a "resurgence in demand for titanium pigment and from the welding sector" as well as "strong market fundamentals driving a robust long-term price".

The post Why the Sovereign Metals (ASX:SVM) share price spiked today appeared first on The Motley Fool Australia.

Shares in Sovereign Metals Limited (ASX: SVM) have held onto gains they saw in early trade after the company announced its flagship rutile deposit is among the world's largest. At the time of writing, the Sovereign Metals share price is trading 77 cents, 13.97% higher than yesterday's close.

Let's take a look at what may be driving the Sovereign Metals share price today.

Today's news from Sovereign Metals

Today, the mineral exploration company released the maiden resource estimate for its Kasiya rutile deposit – located in Malawi.

The site's assay results include 644 metric tonnes at 1.01% rutile, including a high-grade component of 137 metric tonnes at 1.41% rutile.

According to Sovereign Metals, this makes Kasiya the second largest rutile resource in the world behind Iluka Resources Limited's (ASX: ILU) Sierra Rutile.

Sovereign Metals says the project's mineralisation occurs in a large, coherent deposit. A lot of the deposit's high-grade material exists just 5 metres from the surface.

The maiden resource estimate only covered 43% of the project's ~114 square kilometre rutile footprint.

Thus, the company is expecting future resource growth.

What's next?

A scoping study is currently examining the extent of the rutile deposit.

The study will focus on environmental, social, and governance measures and sustainability, and will be completed late this year.

Sovereign Metals is also undergoing an "aggressive" drilling program to allow for future resource upgrades and extensions at the deposit.

The company expects Kasiya's resource growth could make it the largest rutile deposit in the world.

Rutile's environmental benefits

Natural rutile is the purest form of titanium dioxide and the preferred feedstock for titanium pigment and metal. Titanium pigment can be found in paints, coatings, and plastics.

Rutile's scarcity has seen the titanium industry develop carbon intensive substitutes.

Therefore, the company believes one tonne of natural rutile can save 2.8 tonnes of carbon emissions from being created.

Commentary from management

Sovereign Metal's managing director Dr Julian Stephens commented on the findings, saying:

It is a remarkable result to achieve the maiden JORC mineral resource estimate of this scale, grade and global significance in under 18 months since discovery.

We believe this maiden resource is just the beginning and expect to upgrade and expand the resource over the coming quarters.

Sovereign Metals share price snapshot

2021 has been a good year so far on the ASX for the Sovereign Metals.

Currently, the Sovereign Metals share price is 109% higher than it was at the start of the year. It has gained 307% since this time last year.

The company has a market capitalisation of around $321 million, with approximately 414 million shares outstanding.

The post Here's why the Sovereign Metals (ASX:SVM) share price is up 14% appeared first on The Motley Fool Australia.

The small-cap space erupted last week with the Province Resources Ltd (ASX: PRL) share price surging as much as 600% on its move to produce zero carbon-hydrogen.

While the Province Resources ship may have already left the port, here are three small cap ASX shares in the exploration and commodity space that have received a 'speculative buy' rating from broker Euroz Hartleys. 

Sovereign Metals Limited (ASX: SVM) 

Sovereign Metals has a 100% interest in the Kasiya project located in Malawi. Kasiya is a saprolite-hosted rutile deposit, otherwise known as an eluvial deposit. Rutile prices have been increasing recently.

Hartleys believes that Kasiya has all the hallmarks of developing into a significant rutile producer in the medium term. Based on the broker's speculative assumptions, it seems possible the deposit could likely support a production size of 100 to 130 kt pa based on a 10mtpa plant. Despite the project's medium to long term potential, the broker acknowledges its key risks, including project location (Malawi) and potential challenges in obtaining development capital. 

The broker maintains a target price of 60 cents which represents an upside of 42%. 

Tietto Minerals Ltd (ASX: TIE) 

Tietto Minerals continues to de-risk the development of its Abujar gold project, with the aim of becoming "West Africa's next gold mine". The company recently increased ownership in the project to 88% (at the mining stage) and pending its pre-feasibility study (PFS) results in the coming weeks, which will be the first look at the project's economic parameters. 

Hartleys sees significant exploration upside with its current 3 million oz expected to grow. Ongoing drilling is improving resource confidence for optimised mine plans feeding into development studies. News flow from drilling is expected to be strong, and the PFS delivery a key milestone for the ultimate project development.

The Abujar PFS is due late in the first quarter of the calendar year 2021, with the study investigating a potential 3.5Mtpa open operation.

Hartleys coverage rates the company as a speculative buy with a target price of 70 cents per share or an upside of 89% to its current price. 

Legend Mining Limited (ASX: LEG) 

Legend Mining's early metallurgical test work from the Mawson prospect within the Rockford project, Fraser Range in Western Australia, looks positive with high recoveries for copper and nickel.

Hartleys describes the project as catalyst rich, with a large and growing footprint auguring well for the next major discovery. 

The report cites that although the mineralised intrusive source has not yet been drilled out to economic status, this is just a matter of time. Based on the occurrence of high-grade massive sulphides within ultramafic intrusive rocks, net textures consistent with analogous major deposits and the presence of platinum group elements and gold.

The broker is 'unwavering' in its conviction with a speculative buy maintained and a target price of 30 cents.

Foolish takeaway

Small-cap ASX shares in the mining and exploration sector are fraught with risks as projects attempt to transition closer to producer status.

While Province Resources may have delivered eye-watering returns last week, investors who bought the top would have otherwise found a -40% hole in the pocket. 

The post Broker rates these 3 small cap ASX shares as a speculative buy  appeared first on The Motley Fool Australia.