Cobalt is a key metal in the dominant lithium-ion battery chemistries, meaning demand for the stuff is being swept along by the biggest disruptive industrial event since Henry Ford’s Model T hit the roads in the early 1900s – the electric vehicle revolution.
We introduced Highlands Pacific to our Portfolio after having closely followed the stock’s progress for several years. A number of important and positive developments have taken place over the past 12 months. Firstly, its share price has stabilized following several years of decline; its Ramu nickel-cobalt project is producing solidly and first cash flows have been received; uncertainty surrounding the Frieda copper-gold project has gone; and corporate interest has grown as metals trader Trafigura boosted its stake to 16%.
Highlands Pacific (ASX: HIG, Share Price: $0.066, Market Cap: $61m) is an emerging PNG resource play, with two advanced projects and an early-stage exploration play, which we’ve followed for a number of years via our Watch-List. Various coincident factors have led us to upgrade our recommendation from Watch to Speculative Buy.