What's driving the Chalice Mining share price on Tuesday?

Chalice Mining has taken a step to increase its holding in another Western Australian project.

| More on:
a female miner looks straight ahead at the camera wearing a hard hat, protective goggles and a high visibility vest standing in from of a mine site and looking seriously with direct eye contact.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Chalice Mining share price has slipped into the red at lunchtime on Tuesday, along with the broader Materials sector
  • The company has also committed to the second stage of a joint venture that could see it owning a 70% stake in the South West Project
  • The Western Australian project houses copper, nickel, and platinum group elements 

The Chalice Mining Ltd (ASX: CHN) share price is slipping in lunchtime trade on Tuesday amid news of the company's 51%-owned South West Project.

The company has agreed to get started on activities that could see it snapping up another 19% stake in the nickel, copper, and platinum group elements project.

At the time of writing, the Chalice Mining share price is $4.63, 1.07% lower than its previous close.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is down 0.58% and the S&P/ASX 200 Materials Index (ASX: XMJ) has fallen 1.72%.

Let's take a closer look at the company's latest news.

Chalice Mining doubles down on South West Project

The Chalice Mining share price is edging lower amid Venture Minerals Limited (ASX: VMS) announcing the ASX 200 mineral explorer has agreed to kick off the second stage of its joint venture.

The second stage could see Chalice Mining earning an additional 19% hold in the South West Project in return for $2.5 million of expenditure over two years.

That would see it with 70% ownership of the project.

Today's news comes just weeks after the company identified two new targets at the project.

In the second stage, Chalice Mining will follow up on the new targets to prepare for potential drill testing.

The project also hosts the Thor and Odin prospects. Both have been found to house copper and nickel.

Venture Minerals managing director Andrew Radonjic said Chalice Mining's commitment to the second stage is "a strong endorsement of the project".

Radonjic also noted recent nickel findings suggest $2.5 million of additional exploration "should go a long way" to exposing the project's potential.

If Chalice Mining earns the extra 19% stake, Venture Minerals can choose between contributing 30% or diluting its interest in the joint venture to 10%, reverting its interest to a 1.25% net smelter return royalty.

Chalice Mining share price

Sadly, the Chalice Mining share price is well and truly in the long-term red.

The stock is currently 51% lower than it was at the start of 2022. It has also fallen 31% over the last 12 months.

For comparison, the ASX 200 has dumped 8% year-to-date and 7% since this time last year.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Materials Shares

smiling worker stands before power generator technology
Materials Shares

Fortescue shares jump 5% on record performance

This mining giant was in fine form during the quarter.

Read more »

A man casually dressed looks to the side in a pensive, thoughtful manner with one hand under his chin, holding a mobile phone in his hand while thinking about something.
Materials Shares

Should you buy Pilbara Minerals shares today?

Let's see if analysts think investors should be buying the lithium giant's shares.

Read more »

Image of young successful engineer, with blueprints, notepad and digital tablet, observing the project implementation on construction site and in mine.
Materials Shares

Expert says this ASX mining stock could rise almost 30%

Let's see which miner is being tipped as a buy for investors right now.

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

BHP shares charge higher on record copper and iron ore production

Let's see how the miner performed during the fourth quarter.

Read more »

A man stands with hands on hips surveying construction of three high-rise buildings.
Materials Shares

Building activity on the rise – will ASX materials shares benefit?

New data from the March quarter shows a sharp rise in building activity. 

Read more »

Man smiling at a laptop because of a rising share price.
Materials Shares

Macquarie predicts 11% upside for this ASX materials stock

Here's why the broker is positive on the stock.

Read more »

Miner and company person analysing results of a mining company.
Materials Shares

Rio Tinto share price falls on Q2 update

Let's see what the mining giant reported for the second quarter.

Read more »

a man in a hard hat and high visibility vest smiles as he stands in the foreground of heavy mining equipment on a mine site.
Materials Shares

Could these 3 ASX materials shares be set to double?

This broker has buy ratings and aggressive price targets for these holdings. 

Read more »