In July 2021, I released a research note on ASX:ARN, focusing on the flagship Ni-Cu-PGE Narndee Windimurra Complex. As the largest layered mafic-ultramafic complex in Australia (and the second-largest globally), massive potential exists for the discovery of a company making deposit with progress ongoing.

However, while investors have been focused on the nickel story, major progress is being made with ARN’s recently secured lithium and rubidium tenements (Wyemandoo & Niobe acquisition) – Lithium and Rubidium is thus the exclusive focus of this 2nd informational note. Understanding of rubidium and its potential applications is obscured by minimal public verifiable data and a lack of awareness by investors. It is thus possible that the rubidium opportunity is being overlooked by ASX investors.

RESEARCH NOTE: Aldoro Resources Limited (ASX: ARN) ‘Clean energy metals portfolio more than meets the eye: Uncovering Lithium and world-class Rubidium grades at Niobe’

After delving into the obscure world of rubidium, I've been encouraged by the emerging range of applications, increasing (albeit low) demand, extreme pricing and interest in this very soft, silvery-white metal in the alkali metal group. Here's the helicopter view of what I found:

• Despite its relative anonymity, rubidium compounds have a range of highly promising chemical & photo-electric applications due to its unique properties: Rb metal is easily vaporized and has a convenient spectral absorption range and Rb crystals have very active free electrons, thus it has useful electrical conductivity and thermal conductivity.
• Rubidium’s current global demand is estimated at circa 200 tonnes per annum (at +90% purity) sourced from an estimated 180,000 tons of ore (at 0.1% purity) per annum (Source: Mordor Intelligence Analysis). Although the rubidium market is very small in terms of volumes/tonnage and relatively hidden, the market is currently constrained by limited supply. This, combined with nascent (but fast-growing) applications, suggests significant growth and upside potential exists for Rb in the coming decades
• Based on existing uses of rubidium, the market is expected to experience growth of 22% through to 2026 (4%+ p.a.) (Source: Mordor Intelligence Analysis). This growth is primarily based on existing applications in biomedical research (use as a biomarker and blood-flow tracer for the detection of Coronary Heart Disease (CAD) and the detection of brain tumours), electronics and specialty glass (fibre) for enabling 4G and 5G networks due to the electrical conductivity properties of rubidium carbonate (Rb2CO3).
• Research suggests that it is possible that actual growth across the next decade in rubidium will exceed forecasts due to a plethora of important emerging applications. For example, Rb is currently being investigated at the R&D stage for use in rubidium-based thin-film solar cell materials and thermoelectric materials. Moreover, although Rubidium is not at present used to any great extent in battery technology, Rb-doped high-rate lithium battery cathode materials were recently found to increase the recharging capacity and the discharging speed of batteries
• In addition, rubidium and caesium ions are being studied as electrolyte additives for sodium-ion batteries. If sodium-ion batteries were to take market share from traditional lithium-ion batteries, the demand for Rb is likely to increase further due to improve ionic conductivity and stability in sodium-ion electrolyte. Rb, therefore, provides a hedge of sorts for covering both of the promising forms of battery compositions that are in existing use and in development stage respectively: lithium-ion and sodium-ion batteries.
• Rubidium pricing is relatively obscure; however, market commentary suggests it has been rising and is significantly higher than other comparable elements. The market price of 99.75% rubidium carbonate, the most widely used rubidium chemical, was around $57 USD for 10 grams in 2019 (i.e. $5,700 USD per kilogram) (Source: International Lithium Corp). Remarkably, this is in the order of more than 100x higher than the price for Lithium or Potassium

My conclusion is that Rubidium’s position in 2021 may be akin to lithium over three decades ago. Although demand is currently minimal, the use of Rb in future energy systems (thin-film solar, sodium-ion batteries, nuclear) and other biomedical & electronic applications shows promise and consideration should be given by the industry today to the availability of rubidium resources to secure stable future supply. It is possible that the shift towards a new energy economy will continue to result in a massive increase in the number of new minerals and metals that are increasingly finding applications across multiple sectors: Rb may end up playing a pivotal role in this mix.

Last week, I had the opportunity to speak with the Chairman of the Board of Aldoro Resources (ASX:ARN), Mr Joshua Letcher. We spoke about the history of the company, the flagship Ni-Cu-PGE Narndee project (which is under-explored and globally significant) and the upcoming drilling campaign, which management is quietly confident about.

Following on from this discussion, I've produced a reasonably balanced and elaborate equity research note on the company (as per their request) with the aim to increase the visibility and awareness of ARN’s shares in the financial markets. This report, of course, represents my own personal opinion; ARN has neither limited nor in any other way influenced the content of this report.

READ THE EQUITY RESEARCH NOTE

Following this process, I'm excited, like many of the existing shareholders here, to see how the drilling campaign plays out over the coming weeks. Although ARN at this stage is a speculative investment (due to its nature as a junior explorer) I'm personally cautiously optimistic of the company's prospects due to the following factors:

• ARN is positioned in the right place at the right time, with battery metal demand firmly on the ascendency. This would be a major strength for Aldoro should drilling return favourable results as is predicted by management, and potentially place ARN in the spotlight of larger players as an M&A target.
• An extremely clean cap table also places ARN in an enviable position. With merely 80.5M shares on is-sue and 48% held by the Top 20, the company is positioned for a major re-rate should drilling be favourable.
• Pioneer Development Fund’s involvement with a significant holding and representation on the board via Lincoln Ho is reminiscent of other major mining success stories including VUL, RTR and CHN – up 5,087%, 621%, and 2,865% respectively since 3rd Jan 2020
• We are about to enter a period of heightened news flow and this is often a period of rising share price for companies as it presents not only the opportunity to highlight company defining discoveries but also expands the audience and awareness of the company within the industry and beyond.
• I am encouraged by the involvement of experienced and successful global technical experts in the drilling campaign, which highlights a further reason to be bullish on ARN. In addition to Dr Minlu Fu’s technical involvement in the Narndee Nickel-PGE project, Dr Fu and associates committed to invest $2 million into Aldoro at $0.20 per share which is a significant show of faith into the Narndee Nickel-PGE Projects prospectivity and Aldoro’s methodical derisking efforts prior to drilling the largest mafic-ultramafic complex in Australia.
• Although the company remains high-risk, historical ASX nickel sulphide success stories suggest that upside could be truly asymmetrical. Shares in Sirius were worth less than 6 cents in July 2012 before Mr Bennett and his team discovered the Nova-Bollinger nickel and copper resource in WA. Just 3 years later, in 2015, Sirius shares were valued at A$4.38 ($1.8 billion) with an acquisition by Independence Group (ASX:IGO).
• ARN is currently in a major bullish trend, above the 20 (34.5c), 50 (34c), and 200 (23c) day moving averages. In addition, ARN remains within a healthy RSI range and with a positive MACD.

Now it is time for ARN to "walk the walk" with impending drill results over the coming weeks incoming. Using modern exploration techniques, Chairman Joshua Letcher is confident of a company-making discovery. Should a discovery be made, it is safe to say that with only 80.5M shares on issue and a market capitalisation of merely 31M at 39 cents, Aldoro Resources is a potential multi-bagger target.

I've taken the opportunity to follow in the footsteps of some of the well-researched posters here and have added ARN to my own Strawman portfolio at 43.5 cents.

T.E.P.