Highlights

• Vancouver-based Spark Energy Minerals reports high rare earth element concentrations in Brazil's Minas Gerais state.
• Surface samples peak at 6,417 ppm total rare earth oxides.
• Early-stage exploration at the 4,000-hectare Caladão Target shows potential for an emerging rare earth and lithium hub.
• The Caladão Target is adjacent to Axel REE Limited.
• The company faces significant financial challenges with no current revenue and high speculative risk.
• Represents an interesting play in non-Chinese rare earth infrastructure.

Vancouver-based Spark Energy Minerals (CSE: SPRK; OTC Pink: SPARF) has released a round of highly encouraging surface sampling results from its Caladão Target (opens in a new tab) in Brazil’s Minas Gerais state, highlighting anomalously high concentrations of rare earth elements (REEs) and gallium. The company reported stream sediment values peaking at 6,417 ppm total rare earth oxides (TREO) and soil values reaching 3,041 ppm TREO, including gallium oxide readings up to 94.07 ppm. The 4,000-hectare Caladão Target lies within Spark’s flagship 64,359-hectare Arapaima Project, directly adjacent to Axel REE Limited (ASX: AXL), a better-capitalized and more advanced REE explorer in the same district. Spark draws clear comparisons between its own early-stage geochemical profile and Axel’s—positioning itself as a rising contender in what could become a major Western rare earth hub outside China.

While Spark’s results validate the potential of Brazil’s Lithium Valley to emerge as a dual lithium-REE basin, investors should temper enthusiasm with caution. These are preliminary reconnaissance-stage data with no defined resource, and Spark has yet to drill.

Rock and sediment samples are inherently selective and often overstate economic potential. Moreover, Spark’s financial position—recently bolstered by a funding arrangement with Sorbie Capital (opens in a new tab)—still lags far behind what will be needed to prove a viable, scalable deposit.

Nonetheless, in a global market rattled by China’s rare earth export restrictions and gallium supply cuts, Spark’s early entry into Brazil’s emerging REE scene deserves attention.

Spark Energy Minerals is a micro-cap Canadian junior explorer focused on lithium and rare earth elements (REE) in Brazil. The stock is currently trading flat at CAD 0.08, with a market cap of approximately CAD 11.05 million. While the company boasts a high beta (1.83), indicating elevated volatility, its 52-week return (+45.45%) reflects growing speculative interest in Brazil’s Lithium Valley and recent surface sampling announcements related to REEs and gallium.

However, Spark’s financials underscore the extreme risks. The company generates no revenue and operates at a trailing net loss of CAD 4.54 million, with a negative EPS of CAD -0.08. Return on assets (-25.68%) and equity (-53%) are deeply negative. Liquidity is strained with just CAD 5,990 in cash as of the last quarter and a current ratio of 0.37—well below solvency comfort levels. Despite a recent financing deal with Sorbie Capital, Spark’s survival depends on continued capital raises. With no proven resources yet and high burn, investors should remain cautious and view the stock as a high-risk, high-reward speculative bet tied to the successful exploration and eventual development of Brazilian REE and lithium assets.

As always, Rare Earth Exchanges (REEx) encourages scrutiny of speculative juniors while recognizing the strategic importance of building non-Chinese REE infrastructure. If Spark can advance to drilling and delineate a resource, this project could meaningfully contribute to Western supply diversification.

Source: Spark Energy Minerals Inc. News Release, May 9, 2025.