Fortuna Metals (ASX: FUN)

Sector: Rutile & Graphite Exploration
Share Price: (18 Sept 2025): A$0.12
Market Cap: A$29.7M
Enterprise Value: A$25M
Cash: ~A$4.7M

What Does Fortuna Do?

Fortuna Metals Limited (ASX: FUN) is an Australian critical minerals explorer targeting Tier-One rutile and graphite deposits in Malawi. The company holds 658km² of ground directly adjacent to Sovereign Metals’ (ASX: SVM) world-class Kasiya project, the world’s largest rutile resource and the second-largest flake graphite deposit. Fortuna aims to leverage this unique geological setting to discover and develop shallow, high-grade deposits of rutile and graphite, critical minerals essential for aerospace, defence, renewable energy, and the EV supply chain.

Recent Developments

• Acquisition of Ice Shelf Resources (Sept 2025): 100% ownership of Mkanda & Kampini projects, Malawi. Consideration included 55M shares, A$100k cash, and 1.5% gross revenue royalty.
• Capital & Name Change (Aug 2025): Rebranded from Lanthanein Resources to Fortuna Metals (FUN). Fully funded with ~A$4.7M cash post-raise.
• CEO Appointment: Tom Langley (ex-BHP, Northern Star, Creasy Group) brings deep geological expertise and African exploration experience.

Projects – Mkanda & Kampini (Malawi)

• Location: Directly alongside Sovereign’s Kasiya deposit.
• Scale: 658km² landholding in a globally significant rutile-graphite corridor.
• Infrastructure: Excellent access sealed roads, hydroelectric grid power, and rail to the deep-water Nacala port in Mozambique (a Japanese-backed US$7B priority corridor).
• Mineralisation: Saprolite-hosted rutile & graphite in shallow, blanket-style orebodies (0–25m depth). Favourable geology allows free-dig mining, reducing capital intensity and environmental impact.

Current exploration (Phase 1) includes soil sampling, auger drilling, and QEMSCAN mineralogy analysis to confirm rutile and graphite potential. Results are expected in late 2025.

Strategic Location and Infrastructure Advantage
Malawi is rapidly emerging as a critical minerals frontier. The nation has a stable democratic system and is progressively
improving its mining framework, which has been positively recognised by the Fraser Institute for Mining Jurisdictions. Fortuna
Metals’ Mkanda and Kampini Projects, strategically located adjacent to Sovereign Metals’ world-class Kasiya deposit, are
uniquely positioned to align with Japan’s mineral security and infrastructure priorities.

Infrastructure Readiness

• Road Access: Sealed highways traverse project areas, ensuring efficient logistics and mobility.
• Power Supply: The national grid is largely powered by renewable hydroelectric energy, with expansion projects underway,aligning with global ESG standards.
• Rail & Export Facilities – Nacala Corridor: A fully operational rail link connects Malawi to the deep-water port of Nacala inMozambique, one of the deepest natural ports on the east coast of Africa. The Nacala Corridor is a strategic priority under Japan’s US$7 billion African initiative, which emphasises capacity expansion, refurbishment, and resilience upgrades. These enhancements will directly improve cost-efficiency and reliability for bulk mineral exports, including rutile and graphite.

Proven Market & Logistics Synergies

• Market Access for Rutile: Independent validation has confirmed that Malawian rutile meets specifications for high performance titanium metal production, a feedstock of strategic importance to Japan’s advanced manufacturing sectors. Fortuna’s proximity to Kasiya ensures it is well positioned to capture future offtake demand.
• Historical Engagement: Japanese trading houses, including Mitsui & Co., have previously secured rutile supply from this region, reinforcing the strategic value of Fortuna’s projects within Japan’s long-term supply chain ambitions.
• Scalable Logistics Advantage: Planned rail spur connections outlined by Sovereign Metals will integrate with the Nacala line. Fortuna stands to benefit from the same upgrades, ensuring seamless access to global markets at competitive costs. This combination of geological prospectivity, infrastructure readiness, and alignment with Japan’s strategic critical minerals initiative provides Fortuna with a distinctive advantage. The projects are positioned not only to support efficient exploration and sample transport in the near term but also to secure long-term demand visibility, reliable export pathways, and durable partnerships in the global critical minerals supply chain.

Style of Mineralisation

Mineralisation at the Mkanda and Kampini projects is hosted within residual (eluvial) deposits, developed through prolonged tropical weathering and in-situ concentration of rutile- and graphite-rich bedrock. These deposits are typically laterally extensive and form shallow blankets of mineralisation at or just below the surface. Such geological settings are known to yield consistent grades over wide areas, which can make exploration more efficient and development pathways technically straightforward. Importantly, the near-surface position of the mineralisation is expected to minimise stripping ratios and reduce overall operating costs if advanced to production.

Geology

The underlying bedrock is naturally enriched in both rutile and graphite. Over geological time, weathering has liberated these minerals from their host lithologies and concentrated them in soils and saprolitic horizons. The result is a surface and near surface environment where rutile grains and graphite flakes occur in readily accessible horizons. Early field mapping and reconnaissance sampling confirm that these weathering processes mirror those observed at Kasiya, suggesting strong potential for large-scale, high-grade deposits within Fortuna’s ground.

Why Rutile Matters

• Highest-value natural titanium feedstock – 6x more valuable than ilmenite-derived products.
• Strategic demand drivers: Aerospace, robotics, EVs, paints & coatings, and welding consumables.
• Supply Crunch: Rutile trades at ~US$13/TiO₂ unit vs ~US$5 for ilmenite. Global supply is in structural decline since 2017, while demand is forecast to grow to US$7.4B by 2035.

Peer Comparison – Undervalued Positioning

• Sovereign Metals (ASX:SVM): A$430M cap, Tier-One neighbour with Rio Tinto investment.
• Chilwa Minerals (ASX:CHW): A$82M cap, Malawi-focused HMS explorer.
• Osmond Resources (ASX:OSM): A$107M cap on early-stage discovery.
• Fortuna Metals (ASX:FUN): Just A$29.7M cap trading at a fraction of peers despite Tier-One geology and infrastructure advantages.

Leadership

• Tom Langley – CEO: Geologist with BHP, Northern Star, Creasy Group background.
• David Frances – NED: 30+ years’ African mining leadership.
• Peter Pawlowitsch – Chairman: CPA, strong corporate finance & governance.
• Brian Thomas – NED: Former Chairman of Azure Minerals (sold for A$1.7B to SQM/Hancock).

Upcoming Catalysts

• Phase 1 soil sampling & auger drilling results – Q4 2025
• QEMSCAN mineralogy confirmation – Q4 2025
• Acquisition completion – Nov 2025
• Maiden Inferred Resource Target – Q1 2027

Investment Case

Fortuna Metals offers leveraged exposure to the looming rutile supply deficit with:

• Tier-One geology adjacent to the world’s largest rutile resource.
• Low-cost, ESG-aligned exploration and mining advantages.
• Strong cash position, no debt, and experienced leadership.
• Clear re-rating potential as peers demonstrate rapid value uplift post-exploration milestones.

In our view, FUN represents one of the most compelling early-stage rutile-graphite opportunities on the ASX today.

General Advice Warning: This content is general in nature and not financial advice. Do your own research and consult a licensed advisor before investing.