A Mining Speculator’s Dream
Perhaps I should have titled it, “An Adrenaline Junkies Stock!”, both would fit I think
Company
With multiple projects in Greenland and Finland, Bluejay Mining (LSE:JAY) offers both portfolio and commodity diversification focused on base and precious metals in Tier 1 jurisdictions. The Greenland properties are of district scale and the Finland operations are to rediscover prior mining properties potential for continued mining.
Bluejay, through its wholly owned subsidiary Disko Exploration Ltd., has signed a definitive Joint Venture Agreement with KoBold Metals to guide exploration for new deposits rich in the critical materials required for so-called green energy and electric vehicles. They should be looking to release a drill programme in the near future. The partnership is about to expire at the end of this year but they aim to renew the agreement to keep Greenland as a long-term project.
Disko Exploration Ltd holds two additional projects in Greenland – the 692 sq km Kangerluarsuk zinc-lead- silver project, where historical work has recovered grades of up to 45.4% zinc, 9.3% lead and 596 g/t silver; and the 920 sq km Thunderstone project which has the potential to host large-scale base metal and gold deposits. Disko represents the single largest upside in the portfolio.
Bluejay also owns 100% of the fully permitted Dundas Ilmenite Project under its subsidiary Dundas Titanium A/S in northwest Greenland for which it will seek strategic alternatives or future joint ventures. This project has been said to, “…still represent our nearest term pathway to cash flow”.
In Finland, Bluejay currently holds three large scale multi-metal projects through its wholly owned subsidiary FinnAust Mining Finland Oy. The Company has identified multiple drill ready targets at the Enonkoski nickel-copper-cobalt project in East Finland. This project has struck 4% nickel at 33 m depth and 6% at 19m. Bluejay’s Hammaslahti copper-zinc-gold-silver project hosts high-grade VMS mineralisation and extensions of historical ore lodes have been proven in prior years. The drill ready Outokumpu copper-nickel-cobalt-zinc-gold-silver project is located in a prolific geological belt that hosts several high-grade former mines. In effort to save on the cost of capital, their current focus is on Finland (a cheaper jurisdiction compared to Greenland).
Prior News
In 2017, mining articles were reading:
Buy into the positive share price momentum at Bluejay Mining (JAY:AIM) as we believe it could be on the cusp of something very big in Greenland. It is confident of becoming one of the world’s lowest cost mineral sands producers. Minerals sands contain minerals including ilmenite, rutile and zircon.
Another: Bluejay Mining (LON:JAY) Stock Increased An Energizing 133% In The Last Five Years (2019)
Last years drill results (2023) in Greenland disappointed greatly too. Moriusaq West part of the overall resource deposit now stands at 29.7 million tonnes at an in situ TiO2 grade of 1.99%, whereas previously for the same part of the deposit had been indicated/inferred at 59.3Mt at a grade of 3.26% in situ TiO2. Half the total volume of the deposit and nearly half the grade.
In 2021, Bluejay said KoBold Metals, a climate & technology fund overseen Bill Gates, will use machine learning and other computing techniques that helps miners decide where to acquire land, what field data to collect, and where to drill
Of course, there are mouths to feed as it were; there are mining costs, salary costs, project fees, high-interest rates and their stock is nearly completely out of steam.
- 52 WEEK RANGE 0.24 – 2.87
- MARKET CAP £5.35M
- SHARES OUTSTANDING 1.51B
- PUBLIC FLOAT 1.42B (94%)
- Cash (as of March 2024?)–> 80.96k GBP
You can see that they have diluted the heck out of shareholders here. It has been reitterated by the management team numerous times that they have to be careful to spend each and every dollar.
New Blood
With such volatility, it’s no surprise that there have been tremendous management movements within the company as well. It has had several management iterations over the past few years.
Managing Director Eric Sondergaard claims to be confident, cautious and careful. He’s careful about money invested in the ground. He is a large shareholder himself. He has stripped overheads and this month acquired the sedimentary hosted Thule copper project. It’s an extension of the company’s Dundas Ilmenite asset which has had both positive and negative results. This expansion of Bluejay’s license area kisses BHP’s neighbouring Camelot project and when asked if the mining giant could become a strategic partner, although Sondergaard believes they can go without partnership for the short term.
In August 2023, Bluejay successfully divested its Black Schist Projects in Finland to Metals One plc in a transaction worth £4.125 million.
Helium/Industrial Gas
Bluejay Mining announced a strategic decision to broaden its corporate scope, expanding into the exploration and development of helium, industrial gases, and hydrocarbons as of this April.
While it is still focused on an array of metals, particularly base & battery metals, it said that the expansion to industrial gases would complement its exploration and development project. It said that in response to increasing global demand for helium and industrial gases in critical sectors such as healthcare, aerospace, and energy, it was aiming to capitalize.
Any potential acquisition in the industrial gas sector would add significant value to Bluejay’s existing portfolio of mineral assets although I question at what cost..
“Our decision to consider opportunities in the helium, industrial gas and hydrocarbon space has come about through the identification of a number of very compelling, large-scale opportunities, which the company believes warrant further consideration,” quoted Eric Sondergaard.
Their current strategy now is to gain a couple of strategic partners in both Finland and Greenland to demonstrate to the market that they do hold serious potential, enough to turn the heads of some serious mining companies. The rumours are that these investors will be North American.
Red Flags
Some obvious red flags that appear relate to the the high cost of operating in Greenland. Given the immensity of the size and distance, the operations of using costly helicopters are unavoidable; not to mention the weather conditions and ice to manage. Additionally, large assets, in Greenland or otherwise can also be expensive to explore. This ultimately means more drill holes required to state a compelling case to generate a mine. At the same time, their market cap has since been dwarfed over the last months/years and I believe they are nearly in a do-or-die situation with respect to raising capital
Sandgrove Capital had also pulled the plug on their big shareholder following the management changes and its tough to have any faith in Bill Gates to turn anything around through KoBold.
Another aspect I do not find attractive is their very broad approach to ‘what they are’ or what they’re after. Perhaps it’s difficult to hone in given the size of their properties, but it may be helpful for raising capital if they could market themselves as a play with more specificity vs. “we have it all”. There are so many trajectories and with funding tight, it’s hard to be a jack of all trades yet a master of none.
It also makes less than USD$1m in revenue and does not have a meaningful market cap (£5M) which may be a blessing for you, but perhaps not for large investors looking to fund operations to the next stage of development. I find it difficult to get any consistent reports on their data, figures and ratios as well.
The problem with mining is that it is inherently a burning match; you don’t build anything for use to make you more dollars. Instead, the dollars go into the ground. The match burns out.
A lot of upside claims have also been announced years and years ago as well which makes me skeptical on its authenticity.
Closing
I do not think this is an investment as much as these prior stocks we wrote about are investments–> HERE & HERE & HERE & HERE, this stock here is purely speculation. It feels like the stock going sideways is hardly an option, it is either going into Chapter 11 or it is going to absolutely rocket upward from where it currently sits.
BlueJay mining certainly needs a deal of luck to strike a compelling grade of assets to continue to prove the feasibility of their deposits. Diluting shareholders anymore is hardly an option, so their funding will have to come from Joint Ventures, debt or royalty/streaming agreements. I am hearing that they are interested in copper deposits (Thule), their Finland resources (nickel), the new industrial gas asset as well as their “ready to drill” Disko/Dundas projects which leads me to believe there is still lack of clarity moving forward.
Any sparks in revenue likely won’t be enough to establish significant demand. So it seems that the investors will focus more on what could be, than paying attention to the current revenues (or lack thereof). Said another way, investors may be hoping that Bluejay Mining finds some valuable resources and remarkably high-grade results, before it runs out of money. This is inherently a high-risk investment.
However, a change of management, exposure to gases, known high-grade strikes of yesteryear, an immensity of unexplored territory and potential for partnerships could be enough to revitalize the company for shareholders–are you willing to speculate here?
Greenland is a territory where junior mining companies go to die; can BlueJay Mining continue to keep their stock flying?
#StayOnTheBall
