Equatorial Mining & Exploration

Consolidation vehicle to acquire and upgrade artisanal tantalum mines in central Africa which provide 60% + of world production

Equatorial Mining & Exploration (EME) was established in 2012 focused on developing industrial mineral assets in Africa. EME gained control over 550km² of Nigerian coal licences, but the initial attempt to commercialise proved unsuccessful. The end result was a boardroom clear-out and the arrival of a new management team which has masterminded the acquisition of Eastinco and that has a JV deal with the artisanal coltan mining Kuaka co-op in Rwanda. This initial transaction looks to be the blueprint for a series of copy-cat deals which offer a highly compelling opportunity to provide strong and sustained earnings growth.

  • New regulations forcing artisanal miners to improve H&S or shut down

    The Kuaka co-op deal sees EME get an 85% stake in the mine for a US$500,000 cash injection to upgrade the operation. EME could do very nicely as ahead of an expected 5-fold increase in production, the locals have already achieved up to US$125,000 revenue and a net profit of US$75,000 per month.

  • Ultra-rare tantalum is a vital component in smart phones & computers

    Coltan is refined to produce tantalum, one of the rarest elements on the planet. Tantalum capacitors have an extremely high capacitance packed in a small space, allowing for the increased functionality of smart phones.

  • Development of its own more profitable mines in the medium term

    The acquisition of Eastinco will give EME its own mining licences which the team plans to develop to create more profitable independent mining operations.

  • Risked conservative NPV suggests a 0.0468p target price

    Our conservative valuation shows the potential. We initiate coverage of EME with a target price of 0.0468p and Conviction buy stance.


    Equatorial Mining & Exploration is a research client of Align Research. Align Research owns shares in Equatorial Mining & Exploration. Full details of our Company & Personal Account Dealing Policy can be found on our website http://www.alignresearch.co.uk/legal/ 

    For full disclaimer information please refer to the last page of the full document. This investment may not be suitable for your personal circumstances. If you are in any doubt as to its suitability you should seek professional advice. This note does not constitute advice and your capital is at risk. This is a marketing communication and cannot be considered independent research.

Table: financial overview
Year to Dec 2017A 2018A 2019E 2020E
Revenue (£'000) - - 1,187 9,188
Pre-Tax (£'000) (309) (221) (658) 1,766
EPS (p) (0.005) (0.003) (0.0033) 0.0045
Source: Company accounts & Align Research