Mercator Gold (AIM: MCR, OTC: MTGDY) has reported a new NI43-101 Resource Estimate for the Copper Flat project in New Mexico, USA, with 107 million short tons grading an average of 0.303% copper in the Indicated resource category and 46 million short tons grading an average of 0.240% copper in the inferred category.
The resource estimate, which was conducted by SRK Consulting, is stated above a 0.12% copper cut-off and contained within a potentially economic open pit.
“We are highly encouraged by the results of the SRK resource estimate for the Copper Flat deposit, which is stated at a cut-off grade that reflects current expectations”, Mercator Gold MD Patrick Harford said. “[it] will underpin the preliminary assessment being completed by SRK in advance of the Copper Flat project’s listing on the TSX Venture Exchange through the proposed transaction with THEMAC Resources Group Limited”.
Mercator noted that, after a review of several scenarios considering different metal prices, design criteria and operating cost assumptions, SRK assumed a copper price of US$3.50/lb; a metallurgical recovery of 90.9%; mining costs of US$1.72/short ton mined; processing and G&A costs of US$5.49/short ton processed; and slope angles of 45º in all areas.
Copper Flat is a former producing mine with substantial infrastructure still in place. The Copper Flat deposit has historic reserves of 50.21 million short tons at an average grade of 0.45% copper, 0.1244 g/t gold, 2.053 g/t silver and 0.015% molybdenum, based on a cut-off grade of 0.23% copper.
On the basis of current historic reserves and assuming metal prices of US$3/lb copper, US$10/lb molybdenum, US$900/oz gold and US$13/oz silver, the Copper Flat project is estimated to have an NPV (net present value) of US$348 million and an IRR (internal rate of return) of 45%, assuming initial capital costs of US$115 million for the recommencement of production and a discount rate of 8%. The current price of copper is US$3.53/lb.
Mercator’s new business model is focused on acquiring interests in promising assets, adding value, then either spinning them into new vehicles or vending into other companies while retaining a material stake. “The market has a limited tolerance for small cap companies...” Patrick Hartford said to Proactiveinvestors in March “…we are aiming to spot the value in projects and make them go faster…”
In March, Mercator agreed the sale of its entire interest in the New Mexico Copper Company Inc (NMCC), which holds the rights over the project, to THEMAC Resources Group (TSX-V: MAC.H). As a result of the sale, Mercator will acquire a substantial interest in THEMAC to retain a very significant interest in Copper Flat project’s future development.
The company told investors in April that it had fulfilled its objectives in relation to the copper flat, primarily confirming the historic resource. Previously a seven hole drilling programme, totaling 5,041ft was concluded in February.
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Thursday 27 May 2010
http://www.proactiveinvestors.co.uk/companies/news/16908/ovoca-gold-plans-to-buy-back-up-to-10-pct-of-its-shares-on-the-market-16908.html
Ovoca Gold PLC (AIM: OVG) said it intends to shortly seek to put in place the necessary authorities to repurchase up to 10 percent of the company's issued share capital by way of on-market share buy backs. The company does not currently have any authority to repurchase its own shares.
Ovaca said it has a strong balance sheet - US$43 mln in net cash and securities, or 34 pence per share - and in recent months has completed a significant corporate acquisition, undertaken operational activities across its portfolio of assets and made a number of board and management changes. However, despite such activities, the company's market capitalisation continues to trade at a substantial discount to the value of its cash and other liquid investments.
Shares in the group started trading in positive territory while most stocks on AIM and the wider market took another nasty beating in early trades today. Ovoca opened up 1.2 percent at 21p on the buy-back news.
Having the authority to repurchase its shares, will enable the company to respond to volatile stock market conditions, help stimulate liquidity in its shares and provide shareholders with the flexibility, but without any compulsion, to realise value in respect of all or some of their shareholdings in a tax efficient method, the company said in its statement.
Share buy backs will only be executed when appropriate financial and stock market conditions prevail and when the board determines that they are in the interests of the company and its shareholders as a whole.
A circular containing further details on the proposed buy back authorities and convening an extraordinary general meeting of the company, to be held on the day of the company's next annual general meeting in July 2010, will be posted to Shareholders with the 2009 Annual Report.
CEO Tim McCutcheon commented: "I believe this share buy-back is an important step for Ovoca and is part of the foundation for long-term shareholder value. We have an excellent multi disciplined and experienced team who are working on a portfolio of exciting gold assets and we are well funded for several years of operations.
“Ovoca has a proven track record of successfully developing precious metals assets in Russia and utilizing those assets to create value for shareholders. The sale of Goltsovoye in 2009 at a 194% premium to our market capitalisation at the time demonstrates this. Despite this, the company's market capitalization has traded below the value of the company's cash and securities position for over a year. The buy-back programme will allow the board to create additional value for the benefit of our shareholders," McCutcheon added.
Mineral exploration and mine development company Ovoca Gold is listed on AIM and on the ESM market of the Irish Stock Exchange (Ticker: OVX). Its principal activity is gold exploration in the Magadan region of the Russian Federation.
Previously Ovoca acquired, developed and sold to JSC Polymetal the Goltsovoye silver project located in the Magadan region. Currently, Ovoca is aggressively exploring and developing its 100 percent owned Stakhanovsky, Rassoshinskaya and Nevsko-Pestrinskoye licenses.
Stakhanovsky is located approximately 40 kilometres north of Susuman, the second largest city in the Magadan region. It is accessible by year-round road and there is power infrastructure on site. Internal preliminary estimates suggest a gold resource (non JORC code of Russian standard compliant) of over 700,000 ounces. The company intends to put Stakhanovsky into production by 2013.
Rassoshinskaya is in the North Eastern part of the Magadan region about 200 kilometres from the town of Simchan. There is no nearby infrastructure. Rassoshinskaya hosts an epithermal gold deposit named Olcha, which is the focus of Ovoca's exploration program. Olcha and nearby satellite deposits have the potential to host a high grade multi-million ounce gold resource.
Nevsko-Pestrinskoye is located in the central part of the Magadan region near the town of Omsukchan. A year-round road and powerline are near the site. The license completely surrounds the Goltsovoye silver deposit, which was owned by the Company from 2006 - 2009 and sold to JSC Polymetal for US$47.7 million at the time of closing. Ovoca intends to investigate and explore known mineral occurrences that extend beyond the Goltsovoye license area onto Nevsko-Pestrinskoye.
Ovaca said it has a strong balance sheet - US$43 mln in net cash and securities, or 34 pence per share - and in recent months has completed a significant corporate acquisition, undertaken operational activities across its portfolio of assets and made a number of board and management changes. However, despite such activities, the company's market capitalisation continues to trade at a substantial discount to the value of its cash and other liquid investments.
Shares in the group started trading in positive territory while most stocks on AIM and the wider market took another nasty beating in early trades today. Ovoca opened up 1.2 percent at 21p on the buy-back news.
Having the authority to repurchase its shares, will enable the company to respond to volatile stock market conditions, help stimulate liquidity in its shares and provide shareholders with the flexibility, but without any compulsion, to realise value in respect of all or some of their shareholdings in a tax efficient method, the company said in its statement.
Share buy backs will only be executed when appropriate financial and stock market conditions prevail and when the board determines that they are in the interests of the company and its shareholders as a whole.
A circular containing further details on the proposed buy back authorities and convening an extraordinary general meeting of the company, to be held on the day of the company's next annual general meeting in July 2010, will be posted to Shareholders with the 2009 Annual Report.
CEO Tim McCutcheon commented: "I believe this share buy-back is an important step for Ovoca and is part of the foundation for long-term shareholder value. We have an excellent multi disciplined and experienced team who are working on a portfolio of exciting gold assets and we are well funded for several years of operations.
“Ovoca has a proven track record of successfully developing precious metals assets in Russia and utilizing those assets to create value for shareholders. The sale of Goltsovoye in 2009 at a 194% premium to our market capitalisation at the time demonstrates this. Despite this, the company's market capitalization has traded below the value of the company's cash and securities position for over a year. The buy-back programme will allow the board to create additional value for the benefit of our shareholders," McCutcheon added.
Mineral exploration and mine development company Ovoca Gold is listed on AIM and on the ESM market of the Irish Stock Exchange (Ticker: OVX). Its principal activity is gold exploration in the Magadan region of the Russian Federation.
Previously Ovoca acquired, developed and sold to JSC Polymetal the Goltsovoye silver project located in the Magadan region. Currently, Ovoca is aggressively exploring and developing its 100 percent owned Stakhanovsky, Rassoshinskaya and Nevsko-Pestrinskoye licenses.
Stakhanovsky is located approximately 40 kilometres north of Susuman, the second largest city in the Magadan region. It is accessible by year-round road and there is power infrastructure on site. Internal preliminary estimates suggest a gold resource (non JORC code of Russian standard compliant) of over 700,000 ounces. The company intends to put Stakhanovsky into production by 2013.
Rassoshinskaya is in the North Eastern part of the Magadan region about 200 kilometres from the town of Simchan. There is no nearby infrastructure. Rassoshinskaya hosts an epithermal gold deposit named Olcha, which is the focus of Ovoca's exploration program. Olcha and nearby satellite deposits have the potential to host a high grade multi-million ounce gold resource.
Nevsko-Pestrinskoye is located in the central part of the Magadan region near the town of Omsukchan. A year-round road and powerline are near the site. The license completely surrounds the Goltsovoye silver deposit, which was owned by the Company from 2006 - 2009 and sold to JSC Polymetal for US$47.7 million at the time of closing. Ovoca intends to investigate and explore known mineral occurrences that extend beyond the Goltsovoye license area onto Nevsko-Pestrinskoye.
African Medical Investments opens new boutique hospital on Maputo, Mozambique
African Medical Investments (AIM: AMEI) said it has opened its new 30 bed private boutique hospital, trauma centre & Well Woman Clinic in Maputo, Mozambique, replicating its successful first boutique hospital, Trauma Centre & Well Woman Clinic in Dar es Salaam, Tanzania, which opened in March 2009.
The opening of this facility is in line with the group’s strategy to rapidly accelerate the roll-out of private boutique hospitals, Trauma Centres, Well Woman and Well Man Clinics across Africa to meet soaring demand for dedicated private medical services.
The group chose Maputo as a suitable location in which to extend its offering due to its large expatriate community and the low number of health facilities currently in the city. The facility has 30 beds including three ICU beds and two neonatal ICU incubators. Additional facilities include a full emergency department, a major and minor operating theatre, delivery rooms, a radiology department with CT scanner, digital X-ray and 4D ultrasound machines, occupational health services, a vaccination centre and a dedicated pharmacy.
The new facility complements African Medical's current healthcare portfolio which includes the Dar es Salaam hospital, the Trauma Centre in Harare and Airport Medical and Vaccination Centres in Johannesburg and Cape Town International Airports.
The company is also extending its current facility in Harare to include a full boutique 20 bed hospital and refurbishment work is also underway to establish a Well Woman and Well Man Clinic in Nairobi, Kenya. It is expected that all these facilities will be fully operational by the end of June 2010.
African Medical CEO Vivek Solanki said: “By the end of June, with three hospitals and three clinics operational, we will have a solid foundation from which to make strong expansionary progress.”
At the end of April African Medical completed the drawdown of funds under its equity line agreement with a fund managed by New York based Harbinger Capital Partners LLC, and the £2.995 million raised will be used to further advance the company's growth strategy.
The new funds completed the drawdown under the US$47 million equity line agreed with Harbinger in October 2009. In the latest transactions, The New York firm will subscribe to shares representing 6.05% of the enlarged capital of African Medical. This will consist of 6.5 million shares at 23 pence and 6 million shares at 25 pence and will up Harbinger’s interest in African Medical to 41.89%.
African Medical will use the proceeds to fund its expansion plans. It aims to be managing a total of ten healthcare facilities by 2012.
The group is also evaluating additional sites including Kampala, Uganda, where the company has recently sponsored a medical investment conference, which was attended by the First Lady of Uganda, the President of Kenya, regional health ministers and some 800 doctors. It is also evaluating opportunities Accra, Addis Ababa and Kigali.
African Medical is the parent company of VIP Healthcare Solutions Ltd which provides healthcare in niche areas, particularly to the expanding African middle classes and the expatriate, non-governmental organisations, diplomatic and tourist markets.
The opening of this facility is in line with the group’s strategy to rapidly accelerate the roll-out of private boutique hospitals, Trauma Centres, Well Woman and Well Man Clinics across Africa to meet soaring demand for dedicated private medical services.
The group chose Maputo as a suitable location in which to extend its offering due to its large expatriate community and the low number of health facilities currently in the city. The facility has 30 beds including three ICU beds and two neonatal ICU incubators. Additional facilities include a full emergency department, a major and minor operating theatre, delivery rooms, a radiology department with CT scanner, digital X-ray and 4D ultrasound machines, occupational health services, a vaccination centre and a dedicated pharmacy.
The new facility complements African Medical's current healthcare portfolio which includes the Dar es Salaam hospital, the Trauma Centre in Harare and Airport Medical and Vaccination Centres in Johannesburg and Cape Town International Airports.
The company is also extending its current facility in Harare to include a full boutique 20 bed hospital and refurbishment work is also underway to establish a Well Woman and Well Man Clinic in Nairobi, Kenya. It is expected that all these facilities will be fully operational by the end of June 2010.
African Medical CEO Vivek Solanki said: “By the end of June, with three hospitals and three clinics operational, we will have a solid foundation from which to make strong expansionary progress.”
At the end of April African Medical completed the drawdown of funds under its equity line agreement with a fund managed by New York based Harbinger Capital Partners LLC, and the £2.995 million raised will be used to further advance the company's growth strategy.
The new funds completed the drawdown under the US$47 million equity line agreed with Harbinger in October 2009. In the latest transactions, The New York firm will subscribe to shares representing 6.05% of the enlarged capital of African Medical. This will consist of 6.5 million shares at 23 pence and 6 million shares at 25 pence and will up Harbinger’s interest in African Medical to 41.89%.
African Medical will use the proceeds to fund its expansion plans. It aims to be managing a total of ten healthcare facilities by 2012.
The group is also evaluating additional sites including Kampala, Uganda, where the company has recently sponsored a medical investment conference, which was attended by the First Lady of Uganda, the President of Kenya, regional health ministers and some 800 doctors. It is also evaluating opportunities Accra, Addis Ababa and Kigali.
African Medical is the parent company of VIP Healthcare Solutions Ltd which provides healthcare in niche areas, particularly to the expanding African middle classes and the expatriate, non-governmental organisations, diplomatic and tourist markets.
TyraTech to raise up to £2.2 mln in recently flagged fundraising
TyraTech (AIM: TYR) announced it plans to raise £1 million and up to a further£1.2 million before expenses by means of a subscription of new shares in the company at 9 pence per new share to provide additional working capital.
The group flagged a fundraising to provide adequate short term working capital headroom on April 29, saying it had already received expressions of interest from potential subscribers totalling approximately £1 million. On the day, it said whilst the business continues to perform broadly in line with expectations, the board was aware, based on current cash flow forecasts and the likely timing of certain cash receipts due to be paid in June, that the company's working capital headroom may fall to below £50,000 during the last weeks of May.
Today, the novel pesticide company for human, animal and environmental health said the subscription is conditional on shareholder approval at a special meeting which it is calling for May 19 2010.
It has received irrevocable undertakings from certain stockholders to vote in favour of the fundraising plans amounting in aggregate to 12,072,390 common shares, representing approximately 55 percent of the capital.
Following approval, interested parties may subscribe for up to 24,444,444 new common shares to raise up to £2.2 million before expenses. Subscriptions have so far been received in respect of 11,113,604 new common chares conditionally raising £1,000,224 million before expenses.
TyraTech said the subscription will enable it to leverage existing partnerships to create new business opportunities, develop relationships with new partners, maintain the confidence of current and future partners in the company, improve its negotiating position with new partners and provide greater security for the future.
In February, the company announced an expanded strategic relationship with professional pest control group Terminix International. Today, TyraTech announced it received an additional order for 300,000 units of its co-branded Terminix SafeShield product from Terminix. This order is currently being fulfilled and represents a significant increase on the amount of Terminix SafeShield ordered in 2009, and additional orders are expected in 2010. The Company's partnership with Terminix requires that it supplies new products, for example other effective presentations and formulations, for new markets.
The relationship with Kraft Foods Holdings Inc (NYSE: KFT) continues strongly. The company has received the second payment under the revised contract announced in October 2009 reimbursing costs of the project incurred during 2010.
TyraTech’s cost base has been cut to a level close to half of that incurred in 2009. “Because of the current cash constraints, negotiations with new potential partners have been difficult and most have simply been put on hold until the company can focus more on the strength of its products and less on the weakness of its balance sheet. Other important areas on hold include geographic expansion as the company has had to freeze the European regulatory program,” the company said.
In full-year results statement from its April 29, TyraTech said it has demonstrated the commercial value of its technology during the period, with the launch of the company’s first Terminix International joint-development product into consumer markets. Consequently, TyraTech achieved product revenue growth and reduced costs by a third to report a significantly improved financial performance in 2009. The company reduced its net pre-tax loss to US$12.9m, down from US$17.4m in the previous year.
The group flagged a fundraising to provide adequate short term working capital headroom on April 29, saying it had already received expressions of interest from potential subscribers totalling approximately £1 million. On the day, it said whilst the business continues to perform broadly in line with expectations, the board was aware, based on current cash flow forecasts and the likely timing of certain cash receipts due to be paid in June, that the company's working capital headroom may fall to below £50,000 during the last weeks of May.
Today, the novel pesticide company for human, animal and environmental health said the subscription is conditional on shareholder approval at a special meeting which it is calling for May 19 2010.
It has received irrevocable undertakings from certain stockholders to vote in favour of the fundraising plans amounting in aggregate to 12,072,390 common shares, representing approximately 55 percent of the capital.
Following approval, interested parties may subscribe for up to 24,444,444 new common shares to raise up to £2.2 million before expenses. Subscriptions have so far been received in respect of 11,113,604 new common chares conditionally raising £1,000,224 million before expenses.
TyraTech said the subscription will enable it to leverage existing partnerships to create new business opportunities, develop relationships with new partners, maintain the confidence of current and future partners in the company, improve its negotiating position with new partners and provide greater security for the future.
In February, the company announced an expanded strategic relationship with professional pest control group Terminix International. Today, TyraTech announced it received an additional order for 300,000 units of its co-branded Terminix SafeShield product from Terminix. This order is currently being fulfilled and represents a significant increase on the amount of Terminix SafeShield ordered in 2009, and additional orders are expected in 2010. The Company's partnership with Terminix requires that it supplies new products, for example other effective presentations and formulations, for new markets.
The relationship with Kraft Foods Holdings Inc (NYSE: KFT) continues strongly. The company has received the second payment under the revised contract announced in October 2009 reimbursing costs of the project incurred during 2010.
TyraTech’s cost base has been cut to a level close to half of that incurred in 2009. “Because of the current cash constraints, negotiations with new potential partners have been difficult and most have simply been put on hold until the company can focus more on the strength of its products and less on the weakness of its balance sheet. Other important areas on hold include geographic expansion as the company has had to freeze the European regulatory program,” the company said.
In full-year results statement from its April 29, TyraTech said it has demonstrated the commercial value of its technology during the period, with the launch of the company’s first Terminix International joint-development product into consumer markets. Consequently, TyraTech achieved product revenue growth and reduced costs by a third to report a significantly improved financial performance in 2009. The company reduced its net pre-tax loss to US$12.9m, down from US$17.4m in the previous year.
African Eagle sends off full Ngasamo assay set from Dutwa nickel project for resource estimate
African Eagle Resources (AIM: AFE) said it has received the last batch of assay results from recently completed drilling at Ngasamo Hill, a part of its Dutwa nickel project in Tanzania. The assays have been sent to Snowden Mining Industry Consultants in Perth for a formal resource estimate.
Managing Director Mark Parker commented: "We are extremely pleased with the drill results from Ngasamo. They reveal a deposit which is somewhat thicker than the main Dutwa deposit, and although the average grade appears to be slightly lower, we expect Ngasamo will add significantly to the overall resource base.”
Of the 66 holes drilled in the vertical reverse circulation (RC) programme which was designed to delineate a formal Mineral Resource to JORC Inferred category or better, 59 intersected mineralisation, and highlights include: 75 metres at 1.42 percent nickel, 84 metres at 1.07 percent nickel including 30 metres at 1.64 percent, 63 metres at 1.41 percent nickel including 45 metres at 1.71 percent, and 57 metres at 1.25 percent nickel including 12 metres at 2.48 percent.
Key cobalt mineralisation intersections include 18 metres at 0.47 percent cobalt, 9 metres at 0.43 percent and 9 metres at 0.27 percent cobalt, the latter including 3 metres at 0.48 percent.
African Eagle has also completed an infill drilling programme at the Dutwa main deposit, designed to test the internal variability of the mineralisation and allow the Dutwa main resource to be upgraded to JORC Indicated category.
"Meanwhile, the nickel market continues to show strength, with prices now up more than 40 percent this year, backed by an increase of 55 percent year-on-year stainless steel demand from China," MD Parker said.
With the determination of a resource estimate at Ngasamo to JORC inferred standard or better, African Eagle will have completed its earn-in of a 35 percent interest in the deposit from Ngasamo's owners, Safina a.s. of the Czech Republic and its Tanzanian subsidiary Precious Metals Refinery Company Ltd. Thereafter, the company can increase its equity in Ngasamo to at least 50 percent and up to 75 percent by completing further resource and feasibility work.
Since discovering major oxide nickel deposits at Dutwa, African Eagle is in transition from a diversified explorer into a nickel mining company. The company completed a positive scoping study on the Dutwa deposit in July 2009 and is now working towards a full feasibility study.
African Eagle is evaluating a second promising oxide nickel deposit at Zanzui in Tanzania, 60 kilometres south of Dutwa.
The company also holds a 49 percent interest in the Mkushi Copper Mines joint venture in Zambia, for which a draft feasibility study was completed in Q4 2008. In addition, it holds a half million ounce gold resource at the Miyabi project in Tanzania, and a portfolio of gold and base metal exploration assets, including two projects in the Zambian Copperbelt.
The company is seeking partners or buyers for its non-core copper, gold and uranium projects.
Managing Director Mark Parker commented: "We are extremely pleased with the drill results from Ngasamo. They reveal a deposit which is somewhat thicker than the main Dutwa deposit, and although the average grade appears to be slightly lower, we expect Ngasamo will add significantly to the overall resource base.”
Of the 66 holes drilled in the vertical reverse circulation (RC) programme which was designed to delineate a formal Mineral Resource to JORC Inferred category or better, 59 intersected mineralisation, and highlights include: 75 metres at 1.42 percent nickel, 84 metres at 1.07 percent nickel including 30 metres at 1.64 percent, 63 metres at 1.41 percent nickel including 45 metres at 1.71 percent, and 57 metres at 1.25 percent nickel including 12 metres at 2.48 percent.
Key cobalt mineralisation intersections include 18 metres at 0.47 percent cobalt, 9 metres at 0.43 percent and 9 metres at 0.27 percent cobalt, the latter including 3 metres at 0.48 percent.
African Eagle has also completed an infill drilling programme at the Dutwa main deposit, designed to test the internal variability of the mineralisation and allow the Dutwa main resource to be upgraded to JORC Indicated category.
"Meanwhile, the nickel market continues to show strength, with prices now up more than 40 percent this year, backed by an increase of 55 percent year-on-year stainless steel demand from China," MD Parker said.
With the determination of a resource estimate at Ngasamo to JORC inferred standard or better, African Eagle will have completed its earn-in of a 35 percent interest in the deposit from Ngasamo's owners, Safina a.s. of the Czech Republic and its Tanzanian subsidiary Precious Metals Refinery Company Ltd. Thereafter, the company can increase its equity in Ngasamo to at least 50 percent and up to 75 percent by completing further resource and feasibility work.
Since discovering major oxide nickel deposits at Dutwa, African Eagle is in transition from a diversified explorer into a nickel mining company. The company completed a positive scoping study on the Dutwa deposit in July 2009 and is now working towards a full feasibility study.
African Eagle is evaluating a second promising oxide nickel deposit at Zanzui in Tanzania, 60 kilometres south of Dutwa.
The company also holds a 49 percent interest in the Mkushi Copper Mines joint venture in Zambia, for which a draft feasibility study was completed in Q4 2008. In addition, it holds a half million ounce gold resource at the Miyabi project in Tanzania, and a portfolio of gold and base metal exploration assets, including two projects in the Zambian Copperbelt.
The company is seeking partners or buyers for its non-core copper, gold and uranium projects.
Minera IRL making good progress at Don Nicolas gold project in Patagonia
Minera IRL (AIM, BVL: MIRL, TSX: IRL) said the feasibility study for the Don Nicolas gold project in Patagonia, Argentina, is well underway.
Two rigs are now engaged in extension and in-fill drilling on the Sulfuro Vein at La Paloma and when completed, expected by the end of June, will move on to a similar exercise on the gold mineralization at Martinetas. This will allow the resource to be substantially categorized as Measured and Indicated Resource. The exploration focus is to make new discoveries near defined resources whilst progressively assessing several other existing exploration targets.
Good progress is being made on other aspects of the feasibility program such as the environmental EIA study, metallurgical testing, mining studies and a hydrology program aimed at securing adequate water resources.
Don Nicolas currently has an Indicated Resource of 1,078,000 tonnes at 5.8 g/t for 200,700 ounces of gold and an Inferred Resource of 1,075,000 tonnes at 4.6 g/t for 158,400 ounces of gold.
The amalgamation of Hidefield Argentina into Minera IRL Patagonia SA is now substantially complete and the 2010 program is in full swing.
"I am extremely pleased with our work program in Patagonia and am more convinced than ever that the Hidefield takeover was an excellent transaction." said Courtney Chamberlain, executive chairman of Minera IRL. "We have a high quality, enthusiastic team which has integrated very well and increasing potential is already emerging on our tenements."
Inaugural exploration field work success has already mapped a new, significantly wide breccia zone at Escondido, with a strike length of over 500 meters and up to 100 meters wide, located immediately south of Mariana Resources' (AIM: MARL) Las Calandrias project.
Of the 22 outcropping rock samples taken by Minera IRL at Escondidos, 11 returned values above 0.1g/t gold of which 7 were above 0.2g/t gold. Twelve samples analysed also assayed above 4g/t silver. The highest grade sample assayed 2.4g/t gold and 84g/t silver.
Analysts at broker FinnCap are currently in South America and noted that the closest intersection Mariana Resources drilled at Calandria Sur, Las Calandrias, was collared 10 metres from the Minera IRL property boundary.
Recent results show that the Las Calandrias mineralisation is present on both properties. FinnCap believes Las Calandrias has the potential to become a series of open pit mines extending over both properties. Minera IRL and Mariana Resources know each other well and may cooperate in the future as the projects become more advanced, it added.
Field work on Minera IRL’s property is also gearing up at Pan de Azucar where earlier Hidefield surface sampling obtained gold assays as high as 54g/t from the outcropping low-sulphidation quartz vein that has been mapped on surface over a strike length of 1 kilometre. Environmental and archaeological clearance is in progress on both of these projects in preparation to the follow-up phase of exploration.
The group operates the Corihuarmi gold mine and the emerging Ollachea gold project in Peru as well as the Don Nicolas project.
Two rigs are now engaged in extension and in-fill drilling on the Sulfuro Vein at La Paloma and when completed, expected by the end of June, will move on to a similar exercise on the gold mineralization at Martinetas. This will allow the resource to be substantially categorized as Measured and Indicated Resource. The exploration focus is to make new discoveries near defined resources whilst progressively assessing several other existing exploration targets.
Good progress is being made on other aspects of the feasibility program such as the environmental EIA study, metallurgical testing, mining studies and a hydrology program aimed at securing adequate water resources.
Don Nicolas currently has an Indicated Resource of 1,078,000 tonnes at 5.8 g/t for 200,700 ounces of gold and an Inferred Resource of 1,075,000 tonnes at 4.6 g/t for 158,400 ounces of gold.
The amalgamation of Hidefield Argentina into Minera IRL Patagonia SA is now substantially complete and the 2010 program is in full swing.
"I am extremely pleased with our work program in Patagonia and am more convinced than ever that the Hidefield takeover was an excellent transaction." said Courtney Chamberlain, executive chairman of Minera IRL. "We have a high quality, enthusiastic team which has integrated very well and increasing potential is already emerging on our tenements."
Inaugural exploration field work success has already mapped a new, significantly wide breccia zone at Escondido, with a strike length of over 500 meters and up to 100 meters wide, located immediately south of Mariana Resources' (AIM: MARL) Las Calandrias project.
Of the 22 outcropping rock samples taken by Minera IRL at Escondidos, 11 returned values above 0.1g/t gold of which 7 were above 0.2g/t gold. Twelve samples analysed also assayed above 4g/t silver. The highest grade sample assayed 2.4g/t gold and 84g/t silver.
Analysts at broker FinnCap are currently in South America and noted that the closest intersection Mariana Resources drilled at Calandria Sur, Las Calandrias, was collared 10 metres from the Minera IRL property boundary.
Recent results show that the Las Calandrias mineralisation is present on both properties. FinnCap believes Las Calandrias has the potential to become a series of open pit mines extending over both properties. Minera IRL and Mariana Resources know each other well and may cooperate in the future as the projects become more advanced, it added.
Field work on Minera IRL’s property is also gearing up at Pan de Azucar where earlier Hidefield surface sampling obtained gold assays as high as 54g/t from the outcropping low-sulphidation quartz vein that has been mapped on surface over a strike length of 1 kilometre. Environmental and archaeological clearance is in progress on both of these projects in preparation to the follow-up phase of exploration.
The group operates the Corihuarmi gold mine and the emerging Ollachea gold project in Peru as well as the Don Nicolas project.
Avocet Mining denies rumours of US$250 mln disposal of North Lanut and Penjom gold mines
Avocet Mining (LSE:AVM) has denied press specuation that it has sold its two gold mines in south-east Asia for US$250 million.
While Avocet did confirm it was in ‘very preliminary discussions’ with interested parties that may lead to a sale, it quashed any idea that a disposal was on the immediate horizon. Press speculation suggested the buyer of Avocet’s North Lanut and Penjom mines was PT Labong Tandai, which already holds a 20% stake in North Lanut and the Bakan project in Indonesia.
Over the past 12 months (to 31 March 2010), total cumulative production from the two mines was 107,000 ounces.
Avocet’s other key project is the Inata gold mine in Burkina Faso, where it holds a 90% interest. Inata is currently ramping up production to 10,000 ounces per month, and hosts 900,000 ounces of reserves and 1.7 million ounces of resources.
While Avocet did confirm it was in ‘very preliminary discussions’ with interested parties that may lead to a sale, it quashed any idea that a disposal was on the immediate horizon. Press speculation suggested the buyer of Avocet’s North Lanut and Penjom mines was PT Labong Tandai, which already holds a 20% stake in North Lanut and the Bakan project in Indonesia.
Over the past 12 months (to 31 March 2010), total cumulative production from the two mines was 107,000 ounces.
Avocet’s other key project is the Inata gold mine in Burkina Faso, where it holds a 90% interest. Inata is currently ramping up production to 10,000 ounces per month, and hosts 900,000 ounces of reserves and 1.7 million ounces of resources.
United Utilities sells Australian arm for A$225 mln to Mitsubishi-led consortium
United Utilities (LSE:UU.), Britain’s largest listed water company, had entered into an agreement to sell its 100% owned subsidiary United Utilities Australia to a consortium led by Mitsubishi Corporation.
The deal will see the consortium pay A$176 million and assume A$49 million in debt, placing a value of A$225 million on the assets.
The consortium includes Mitsubishi Corporation, the Innovation Network Corporation of Japan, Manila Water Company and JGC Corporation.
United Utilities serves approximately 3.2 million premises and a population of approximately 7 million in the North West of England.
The deal will see the consortium pay A$176 million and assume A$49 million in debt, placing a value of A$225 million on the assets.
The consortium includes Mitsubishi Corporation, the Innovation Network Corporation of Japan, Manila Water Company and JGC Corporation.
United Utilities serves approximately 3.2 million premises and a population of approximately 7 million in the North West of England.
Valiant Petroleum discovers oil at East Tybalt, North Sea
Valiant Petroleum (AIM: VPP) confirmed the discovery of hydrocarbons in the Tybalt exploration (well 211/8c-4) in the Upper Magnus Sand Formation within the eastern 'T2' pinch-out prospect having intersected a gross oil column of 85 meters. The Magnus Sand Formation in the North sea was the initial target of the well, which has a gross P50 prospective resource of 35.6 million barrels of oil.
Valiant'S P1632 licence is located in the UK northern North Sea License P1632. The well was drilled by the Diamond Ocean Nomad semisub, and was expected to take around 30 days to reach its target depth of around 3,475 meters.
Valiant reported this morning that initial data from the well confirmed at least 19 meters of reservoir, lower than pre-drill estimates, but with many tests still running, the final net pay calculation is yet to be calculated.
The company also plans to drill a sidetrack from the well to test a four way dip structure (West Tybalt) which lies west of the current well. The company is also weighing up the possibility of an additional sidetrack and a drill stem test to fully test the reservoir’s properties.
Valiant is operator of the blocks with an 80% working interest. The remaining 20% is held by Agora Oil & Gas.
Valiant CEO Peter Buchanan commented: "We are pleased with the early indications from the East Tybalt well. In the event of further success in the West Tybalt side-track well, Valiant believe that sufficient hydrocarbon volumes will have been identified to proceed with a development either on its own or alongside the development / re-development of the other fields in the area including the nearby Valiant-operated Banquo and Helena discoveries."
Valiant'S P1632 licence is located in the UK northern North Sea License P1632. The well was drilled by the Diamond Ocean Nomad semisub, and was expected to take around 30 days to reach its target depth of around 3,475 meters.
Valiant reported this morning that initial data from the well confirmed at least 19 meters of reservoir, lower than pre-drill estimates, but with many tests still running, the final net pay calculation is yet to be calculated.
The company also plans to drill a sidetrack from the well to test a four way dip structure (West Tybalt) which lies west of the current well. The company is also weighing up the possibility of an additional sidetrack and a drill stem test to fully test the reservoir’s properties.
Valiant is operator of the blocks with an 80% working interest. The remaining 20% is held by Agora Oil & Gas.
Valiant CEO Peter Buchanan commented: "We are pleased with the early indications from the East Tybalt well. In the event of further success in the West Tybalt side-track well, Valiant believe that sufficient hydrocarbon volumes will have been identified to proceed with a development either on its own or alongside the development / re-development of the other fields in the area including the nearby Valiant-operated Banquo and Helena discoveries."
Croda International sells German chemicals business for €60.5 mln
FTSE 250 constituent Croda International is selling its Emmerich Site and associated business in Germany to a subsidiary of the KLK Group for €60.5 million.
As part of the deal KLK Group will assume all retirement benefit obligations related to the business of approximately €35.2 million. The remaining €25.3 million will be paid to Croda in cash. “The disposal largely completes Croda's restructuring programme to re-position its oleochemical operations following the acquisition of Uniqema in 2006,” Croda stated.
The Emmerich Site produces fatty acids and glycerine. On a pro-forma basis the business had sales of £80.0m and made an operating loss of £2.1million in 2009.
Croada intends to use the proceeds of the sale to pay down its debt pile. The company’s net debt position as of 31 March 2010 was £292.7 million.
As part of the deal KLK Group will assume all retirement benefit obligations related to the business of approximately €35.2 million. The remaining €25.3 million will be paid to Croda in cash. “The disposal largely completes Croda's restructuring programme to re-position its oleochemical operations following the acquisition of Uniqema in 2006,” Croda stated.
The Emmerich Site produces fatty acids and glycerine. On a pro-forma basis the business had sales of £80.0m and made an operating loss of £2.1million in 2009.
Croada intends to use the proceeds of the sale to pay down its debt pile. The company’s net debt position as of 31 March 2010 was £292.7 million.
BG Group inks joint venture with Exco Resources to tap into US shale gas sector
London’s BG Group (LSE:BG) seems to have an insatiable appetite for gas assets, announcing another joint venture this morning with Exco Resources (NYSE:XCO) to develop gas projects in the United States.
BG Group is acquiring a 50% interest in Exco Resources’ 654,000 (net) acres in the Appalachian Basin, primarily in the states of Pennsylvania and West Virginia for US$0.95 billion. The transaction also includes 5,900 shallow wells which currently produce around 35 million standard cubic feet per day (mmcfd). The significance of the shallow wells is less to do with their production rates, and more to do with their ability to secure the rights to the deeper Marcellus shales.
Shale gas is a fairly new phenomenon, after drilling and fracing technology advanced to a level to make shale gas plays economically viable. The success of shale gas has been so significant in recent years that it has placed downward pressure on natural gas prices across the United States as gas resources and supply has risen substantially.
BG Group chief executive Frank Chapman said: "We are delighted to expand our highly successful alliance with EXCO built around complementary skills and objectives. The new joint venture will further strengthen BG Group's unconventional gas portfolio, adding, at an attractive price, substantial resources adjacent to the premium gas markets of the US eastern seaboard. This transaction provides critical mass to BG Group's US upstream gas business, with total resources estimated at more than 7 trillion standard cubic feet (tcf), equivalent to more than 1.2 billion barrels of oil equivalent."
BG Group is acquiring a 50% interest in Exco Resources’ 654,000 (net) acres in the Appalachian Basin, primarily in the states of Pennsylvania and West Virginia for US$0.95 billion. The transaction also includes 5,900 shallow wells which currently produce around 35 million standard cubic feet per day (mmcfd). The significance of the shallow wells is less to do with their production rates, and more to do with their ability to secure the rights to the deeper Marcellus shales.
Shale gas is a fairly new phenomenon, after drilling and fracing technology advanced to a level to make shale gas plays economically viable. The success of shale gas has been so significant in recent years that it has placed downward pressure on natural gas prices across the United States as gas resources and supply has risen substantially.
BG Group chief executive Frank Chapman said: "We are delighted to expand our highly successful alliance with EXCO built around complementary skills and objectives. The new joint venture will further strengthen BG Group's unconventional gas portfolio, adding, at an attractive price, substantial resources adjacent to the premium gas markets of the US eastern seaboard. This transaction provides critical mass to BG Group's US upstream gas business, with total resources estimated at more than 7 trillion standard cubic feet (tcf), equivalent to more than 1.2 billion barrels of oil equivalent."
Frontier Mining gets more encouraging data from Benkala copper project
Frontier Mining (AIM: FML) has received assay results for the first 8 holes of its infill drilling programme at the Benkala copper project in north-western Kazakhstan, saying the results indicate copper grades of 0.63 percent, slightly higher compared to the historical drilling data in the Soviet era 1976-1980 which indicated an average copper content for the deposit of 0.55 percent.
The latest news affirms what the group announced at the end of March when copper content from the first 3 holes showed an improvement over the Soviet data.
Frontier’s 50% owned KazCopper, a joint venture with Coville Intercorp, undertook the drilling programme at Benkala, with the first 54 holes completed in December. The majority, 48 holes, were drilled between 33-200 metres totalling 4,872.7m in oxide ore, whilst the remaining 6 holes were drilled to depths between 230 - 350 metres totalling 1,826.2m.
The main focus of the programme was to confirm the oxide section of the project, enabling Frontier to prepare for initial copper production using an SX-EW process (solvent extraction and electrowinning).
Drill hole 111-4 intersected copper at 0.74 percent over 19.5m and 117-5 found copper at 0.92 percent over 45.5m.
Erlan Sagadiev, CEO of Frontier Mining commented today: "Now that we are entering the production phase, we are pleased to see that these positive results continue to demonstrate the quality of the Benkala deposit. With 63% recovery in the lab tests, the ability to process the oxide cap of the deposit through conventional SX/EW processing reinforces our decision to use this technology and further supports our overall business strategy for initial production in 2011."
The company will continue to provide updates on its drilling results and development activities at Benkala as they become available.
Frontier expects to issue a JORC compliant resource statement for the oxide/supergene zone in the third quarter of 2010.
Following the completion of the first stage of the infill drilling, KazCopper is now working on an additional 3,000 metres of oxide ore drilling at depths of 100 to 250 metres in the proposed open pit zone.
Frontier is in discussions with joint venture partner Coville regarding a potential merger. The groups announced in February 2010 they signed a memorandum of understanding (MoU) to that effect, and the transaction is expected to be concluded by 31 October 2010.
The Soviet estimates, carried out in the nineteen-seventies, inferred a resource of over 2 million tonnes of contained Copper and associated Gold & Molybdenum. However, due to the lack of infrastructure at that time, the development of a mining operation was abandoned. With the modern development in the area, including the construction of two regional airports, road and rail networks, and the ongoing installation of electricity and other utilities, Frontier does no longer consider infrastructure to be a concern.
The latest news affirms what the group announced at the end of March when copper content from the first 3 holes showed an improvement over the Soviet data.
Frontier’s 50% owned KazCopper, a joint venture with Coville Intercorp, undertook the drilling programme at Benkala, with the first 54 holes completed in December. The majority, 48 holes, were drilled between 33-200 metres totalling 4,872.7m in oxide ore, whilst the remaining 6 holes were drilled to depths between 230 - 350 metres totalling 1,826.2m.
The main focus of the programme was to confirm the oxide section of the project, enabling Frontier to prepare for initial copper production using an SX-EW process (solvent extraction and electrowinning).
Drill hole 111-4 intersected copper at 0.74 percent over 19.5m and 117-5 found copper at 0.92 percent over 45.5m.
Erlan Sagadiev, CEO of Frontier Mining commented today: "Now that we are entering the production phase, we are pleased to see that these positive results continue to demonstrate the quality of the Benkala deposit. With 63% recovery in the lab tests, the ability to process the oxide cap of the deposit through conventional SX/EW processing reinforces our decision to use this technology and further supports our overall business strategy for initial production in 2011."
The company will continue to provide updates on its drilling results and development activities at Benkala as they become available.
Frontier expects to issue a JORC compliant resource statement for the oxide/supergene zone in the third quarter of 2010.
Following the completion of the first stage of the infill drilling, KazCopper is now working on an additional 3,000 metres of oxide ore drilling at depths of 100 to 250 metres in the proposed open pit zone.
Frontier is in discussions with joint venture partner Coville regarding a potential merger. The groups announced in February 2010 they signed a memorandum of understanding (MoU) to that effect, and the transaction is expected to be concluded by 31 October 2010.
The Soviet estimates, carried out in the nineteen-seventies, inferred a resource of over 2 million tonnes of contained Copper and associated Gold & Molybdenum. However, due to the lack of infrastructure at that time, the development of a mining operation was abandoned. With the modern development in the area, including the construction of two regional airports, road and rail networks, and the ongoing installation of electricity and other utilities, Frontier does no longer consider infrastructure to be a concern.
Vedanta Acquires Anglo American’s zinc assets for $1.38 billion
Vedanta (LSE:VED), the India headquarter mining group with a strong presence in base metals production, has diversified its mining interests through the acquisition of Anglo American’s (LSE:AAL) zinc assets for US$1.388 billion. Anglo American placed its zinc operations, along with several other interests, up for sale in 2009 as part of its restructuring. Vedanta on the other hand, has been keen to diversify its mining interests into other regions of the world, which this transaction will help facilitate by giving the FTSE 100 constituent a greater presence in Africa and Ireland.
Vedanta will fund the transaction from its existing cash resources, which stood at US$7.2 billion at the end of March.
Assets included in the transaction include the Lisheen Mine in Ireland, a 74% stake in Black Mountain Mining, which in turn owns the Black Mountain Mine and Gamsberg Project in South Africa, and the Skorpion Mine in Namibia. “Anglo Zinc is an excellent operational and strategic fit with Vedanta's existing zinc business and will create significant long term value for Vedanta's shareholders,” Vedanta stated.
The new assets will boost the company’s annual production capacity of zinc and lead by 37% to 1,462 ktpa, increase attributable reserves and resources by 76%, or 206 million tonnes, and offer ‘significant’ organic growth through the Gamsberg mine – one of the largest undeveloped zinc mines in the world.
Anil Agarwal, Chairman of Vedanta, said: "We are delighted to have reached this agreement with Anglo American to acquire their portfolio of zinc assets. These high quality assets complement Vedanta's existing portfolio, creating the largest zinc and lead producer in the world. We intend to rapidly develop Gamsberg, one of the largest high quality zinc projects in the world, leveraging our world-class large project development expertise. Vedanta has consistently demonstrated a track record of successfully integrating and investing in its acquisitions, and we look forward to working with the high quality management team and employees of Anglo American Zinc, Exxaro and the local communities towards growing the business. We are committed, as we are throughout all of our operations world wide, to maintaining the highest health and safety standards, and to the sustainable development of these operations."
Vedanta will fund the transaction from its existing cash resources, which stood at US$7.2 billion at the end of March.
Assets included in the transaction include the Lisheen Mine in Ireland, a 74% stake in Black Mountain Mining, which in turn owns the Black Mountain Mine and Gamsberg Project in South Africa, and the Skorpion Mine in Namibia. “Anglo Zinc is an excellent operational and strategic fit with Vedanta's existing zinc business and will create significant long term value for Vedanta's shareholders,” Vedanta stated.
The new assets will boost the company’s annual production capacity of zinc and lead by 37% to 1,462 ktpa, increase attributable reserves and resources by 76%, or 206 million tonnes, and offer ‘significant’ organic growth through the Gamsberg mine – one of the largest undeveloped zinc mines in the world.
Anil Agarwal, Chairman of Vedanta, said: "We are delighted to have reached this agreement with Anglo American to acquire their portfolio of zinc assets. These high quality assets complement Vedanta's existing portfolio, creating the largest zinc and lead producer in the world. We intend to rapidly develop Gamsberg, one of the largest high quality zinc projects in the world, leveraging our world-class large project development expertise. Vedanta has consistently demonstrated a track record of successfully integrating and investing in its acquisitions, and we look forward to working with the high quality management team and employees of Anglo American Zinc, Exxaro and the local communities towards growing the business. We are committed, as we are throughout all of our operations world wide, to maintaining the highest health and safety standards, and to the sustainable development of these operations."
Chromex expands to Zimbabwe with acquisition of Waylox Mining
South Africa focused Chromex Mining PLC (AIM: CHX) said it has concluded the acquisition of Waylox Mining (Private) Ltd, a chrome mining company operating in Zimbabwe and a wholly owned subsidiary of TransAfrika Resources Ltd for a total of US$1.15 million.
The deal was signed on April 15 2010, and all conditions have now been fulfilled. Chromex is paying US$300,000 in cash, with the balance of US$815,000 in 3,465,247 new Chromex shares at a price of 15.83 pence per share.
The acquisition is in line with the company's strategy of building a solid portfolio of chrome production assets across southern Africa.
Waylox has been operating in Zimbabwe since August 2008 after acquiring the 683 hectares Trixie and Prince of Wales claims located in the prospective Darwendale area. The Darwendale area is located on the Great Dyke of Zimbabwe which is host to significant chrome resources.
The Trixie and Prince of Wales claims contain economic grades of alluvial chrome resources. The current mineral resource estimated on the 388 ha Trixie project stands at approximately 1.9 million tonnes at an average modelled grade of 13.8 percent chromium oxide Cr2O3. The estimate was calculated on the basis of the results of an exploration programme comprising 245 exploration pits across the five Trixie claims. The 216 ha Prince of Wales claims require further exploration which Chromex plan to conduct over the next six months.
Chromex has initiated a feasibility study on the Trixie claims which is expected to be completed in Q4 2010. Similar chrome operations on the Great Dyke are producing chrome concentrates with Cr2O3 grades ranging from 47 to 50 percent and Cr:Fe ratios in excess of 1.9:1.
CEO Russell Lamming said: "This acquisition represents a significant opportunity for Chromex as we expand our position as a leading chrome company in southern Africa. With resource estimation and metallurgical testwork almost complete we should be in a position to start the development of the Trixie claims in Q4 of this year, and fast-track the project towards production, unlocking value for shareholders."
Astaire Securities featured Chromex in its Morning Report, saying that the acquisition of Waylox Mining moves the company another step towards becoming one of southern Africa’s leading chromite miners.
A feasibility study at Trixie is underway, and it will also be fairly straightforward to bring the Prince of Wales to production. "These operations should give Chromex significant additional production and cashflow, from limited capex and quickly," the broker added.
Chromex currently has two key mining assets located on the Bushveld Complex in South Africa, which between them have total resources of approximately 41 million tonnes of chromite. The Mecklenburg mine lies in the east and the Stellite mine in the west. Both are owned and operated by South African registered Chromex Mining Co, which is 74% owned by Chromex and 26% owned by their Black Economic Empowerment (BEE) partner Umnotho WeSizwe.
In line with its strategy, it is expanding its operations to Zimbabwe. In addition to the acquisition of Waylox, Chromex has signed a binding heads of agreement for acquiring a 49 percent stake in Falvect Mining (Private) Ltd in Zimbabwe.
The company’s flasgship Stellite mine is currently ramping up production. It will initially produce approximately 20,000 run of mine (ROM) tonnes per month, increasing to 40,000 ROM tonnes per month once a dense media separation circuit (DMS) is installed at the plant. The DMS is expected to be completed during the third quarter of 2010. Stellite should reach full capacity by the first quarter of 2011 - producing approximately 500,000 run-of-mine tonnes in the year.
The deal was signed on April 15 2010, and all conditions have now been fulfilled. Chromex is paying US$300,000 in cash, with the balance of US$815,000 in 3,465,247 new Chromex shares at a price of 15.83 pence per share.
The acquisition is in line with the company's strategy of building a solid portfolio of chrome production assets across southern Africa.
Waylox has been operating in Zimbabwe since August 2008 after acquiring the 683 hectares Trixie and Prince of Wales claims located in the prospective Darwendale area. The Darwendale area is located on the Great Dyke of Zimbabwe which is host to significant chrome resources.
The Trixie and Prince of Wales claims contain economic grades of alluvial chrome resources. The current mineral resource estimated on the 388 ha Trixie project stands at approximately 1.9 million tonnes at an average modelled grade of 13.8 percent chromium oxide Cr2O3. The estimate was calculated on the basis of the results of an exploration programme comprising 245 exploration pits across the five Trixie claims. The 216 ha Prince of Wales claims require further exploration which Chromex plan to conduct over the next six months.
Chromex has initiated a feasibility study on the Trixie claims which is expected to be completed in Q4 2010. Similar chrome operations on the Great Dyke are producing chrome concentrates with Cr2O3 grades ranging from 47 to 50 percent and Cr:Fe ratios in excess of 1.9:1.
CEO Russell Lamming said: "This acquisition represents a significant opportunity for Chromex as we expand our position as a leading chrome company in southern Africa. With resource estimation and metallurgical testwork almost complete we should be in a position to start the development of the Trixie claims in Q4 of this year, and fast-track the project towards production, unlocking value for shareholders."
Astaire Securities featured Chromex in its Morning Report, saying that the acquisition of Waylox Mining moves the company another step towards becoming one of southern Africa’s leading chromite miners.
A feasibility study at Trixie is underway, and it will also be fairly straightforward to bring the Prince of Wales to production. "These operations should give Chromex significant additional production and cashflow, from limited capex and quickly," the broker added.
Chromex currently has two key mining assets located on the Bushveld Complex in South Africa, which between them have total resources of approximately 41 million tonnes of chromite. The Mecklenburg mine lies in the east and the Stellite mine in the west. Both are owned and operated by South African registered Chromex Mining Co, which is 74% owned by Chromex and 26% owned by their Black Economic Empowerment (BEE) partner Umnotho WeSizwe.
In line with its strategy, it is expanding its operations to Zimbabwe. In addition to the acquisition of Waylox, Chromex has signed a binding heads of agreement for acquiring a 49 percent stake in Falvect Mining (Private) Ltd in Zimbabwe.
The company’s flasgship Stellite mine is currently ramping up production. It will initially produce approximately 20,000 run of mine (ROM) tonnes per month, increasing to 40,000 ROM tonnes per month once a dense media separation circuit (DMS) is installed at the plant. The DMS is expected to be completed during the third quarter of 2010. Stellite should reach full capacity by the first quarter of 2011 - producing approximately 500,000 run-of-mine tonnes in the year.
Jupiter Energy gives more details about testing of J-50 well
Jupiter Energy (ASX: JPR) has reported a more detailed update on its J-50 oil well in Kazakhstan. The company said the flow rate previously reported on should not be interpreted as being representative of the long term flow rate from the J-50 well that is expected to be achieved based on unrestricted flowing conditions after clean up and stimulation.
Jupiter released an operational update to shareholders titled "Jupiter Energy’s first commercial oil" providing current information relating to the testing of its J-50 well On 7 May 2010.
This update also advised shareholders that the company had made its first oil sale into the Kazakh domestic oil market and begun its transition from an oil explorer to an oil producer.
The company also disclosed to shareholders the status of testing operations of the J-50 well that commenced initial production earlier in the week.
The update provided a flow rate as at the day of the release based on restricted flow conditions. This rate was 220 barrels of oil per day (bopd).
The work program required to satisfy the company's statutory obligations as well as the ongoing preparation of the well for long term production at optimal flow rates was documented under the "Forward Plan" section of the 7 May 2010 announcement.
Jupiter has now provided a more detailed overview of the forward program to assist shareholders in better understanding what work is scheduled to be carried out on J-50 over the next few weeks.
The company is in the process of testing and cleaning up J-50 well prior to a 3 month production testing phase. During the testing phase and clean up phase a range of production performance data will be acquired from the well.
Much of this data is prescribed by the Kazakh authorities and is used to complete the various reports that are needed to apply for a Trial Production licence. A Trial Production licence is required by any company wishing to sell its oil into the export market.
Over the coming weeks the company will clean up the well and recover a range of data including flow rates and pressure data under a number of prescribed choke settings which control the flow rate of the well at surface.
As a result of the fact that (i) the well is still cleaning up (a process where the well expels contaminants which permeated the producing reservoir during drilling thereby restricting flow) and (ii) the well is being produced under prescribed flow rate conditions, an optimal flow rate has not yet been achieved for the well.
Following the clean up phase it is normal practice to stimulate carbonate reservoirs that are prevalent in the producing fields of the Mangistau basin of Kazakhstan to further enhance long term production rates.
Based on offset well data, stimulation is expected to significantly enhance long term production rates.
Jupiter expects that once this work has been completed, a sustainable production flow rate representative of the J-50 well's long term productivity will be known.
The company will announce the results of its forward program, including the sustainable production flow rate on the J-50 well, post stimulation and clean up in due course.
Jupiter released an operational update to shareholders titled "Jupiter Energy’s first commercial oil" providing current information relating to the testing of its J-50 well On 7 May 2010.
This update also advised shareholders that the company had made its first oil sale into the Kazakh domestic oil market and begun its transition from an oil explorer to an oil producer.
The company also disclosed to shareholders the status of testing operations of the J-50 well that commenced initial production earlier in the week.
The update provided a flow rate as at the day of the release based on restricted flow conditions. This rate was 220 barrels of oil per day (bopd).
The work program required to satisfy the company's statutory obligations as well as the ongoing preparation of the well for long term production at optimal flow rates was documented under the "Forward Plan" section of the 7 May 2010 announcement.
Jupiter has now provided a more detailed overview of the forward program to assist shareholders in better understanding what work is scheduled to be carried out on J-50 over the next few weeks.
The company is in the process of testing and cleaning up J-50 well prior to a 3 month production testing phase. During the testing phase and clean up phase a range of production performance data will be acquired from the well.
Much of this data is prescribed by the Kazakh authorities and is used to complete the various reports that are needed to apply for a Trial Production licence. A Trial Production licence is required by any company wishing to sell its oil into the export market.
Over the coming weeks the company will clean up the well and recover a range of data including flow rates and pressure data under a number of prescribed choke settings which control the flow rate of the well at surface.
As a result of the fact that (i) the well is still cleaning up (a process where the well expels contaminants which permeated the producing reservoir during drilling thereby restricting flow) and (ii) the well is being produced under prescribed flow rate conditions, an optimal flow rate has not yet been achieved for the well.
Following the clean up phase it is normal practice to stimulate carbonate reservoirs that are prevalent in the producing fields of the Mangistau basin of Kazakhstan to further enhance long term production rates.
Based on offset well data, stimulation is expected to significantly enhance long term production rates.
Jupiter expects that once this work has been completed, a sustainable production flow rate representative of the J-50 well's long term productivity will be known.
The company will announce the results of its forward program, including the sustainable production flow rate on the J-50 well, post stimulation and clean up in due course.
African Eagle: $8 billion of nickel and counting
Over the course of the rest of this year, metals explorer African Eagle expects to deliver data that will help reduce the disconnection between its present £11.5 million market value and its claimed $8.8 billion of nickel in northern Tanzania.
Like many AIM metals explorers, African Eagle has flattered to deceive in its time on the market. However, while it has stumbled in its attempts to advance projects, it has built up a not-insignificant brood of nickel, gold and copper exploration projects. Due to the company’s small size, management last year felt forced to choose between their babies. Although the glistering gold price might seem to make those projects attractive, African Eagle has decided to plump for its nickel assets, because of their sheer size and low cost of evaluation.
Managing director Mark Parker, one of the founders of the company with former chairman John Park, also explained to Proactive Investors that ‘the exploration risk is very low’ at its Dutwa nickel project and that the exceptional metallurgy of the site will allow for good recovery rates and low-cost extraction.
Located 100km east of the well connected mining city of Mwanza and close to the main Mwanza-Nairobi trunk road, Dutwa is a nickel laterite deposit. Laterites – near-surface deposits where over many years the weather has leached away more soluble elements to leave mineable concentrations of nickel and other less soluble elements such as iron and magnesium – can be extracted with acid leaching. They have been less favoured than the vein-style nickel sulphides that traditionally were the deposit of choice, due to some expensive ‘miss-steps’ such as BHP’s Ravensthorpe laterite project, which was eventually sold for a song after US$2.1 billion of investment. But more than two thirds of nickel now comes from laterites and Parker is confident that, due to the low iron content of the Dutwa deposit, the project is definitely economic. ‘We can do it for maybe a tenth of the usual capital cost,’ he assures. ‘If Ambatovy [in Madagascar] cost $4 billion, our capital cost, even using the slightly more expensive options like tank leaching, will be $350-$500 million.’
In 2008 African Eagle announced an initial Inferred Mineral Resource estimate for Dutwa of 31 million tonnes at an average grade of 1.1% nickel and 0.034% cobalt, with a contained metal endowment of some 340,000 tonnes of nickel and 11,000 tonnes of cobalt. The company believes the resource will increase following current step-out drilling and the delineation of the nearby Ngasamo deposit, also underway. A pre-feasibility study (PFS) for Dutwa is due at the end of calendar 2010 or in early 2011.
The metallurgy is key, though, explains Parker. ‘What we have is an average nickel content of about 1%-1.5%. But whereas some other companies’ more expensive projects have huge iron content of 30-40-50% and require high temperatures and high pressures to leach out the nickel, at our deposit nature has already done a lot of that work for us - so we have less than 10% iron and are low in magnesium and low in aluminium. So, yes, it’s not the highest grade but the metallurgy means that the extraction process is straightforward. We can process very straightforwardly with tank leaching or even cheaper heap leaching.’
Column leach tests at Dutwa gave 60% to 70% nickel extraction after just 16 days, rising to 90% after four months. This compares well against rival projects, where 540 days of leaching was required to extract 80% of the nickel at one trial heap elsewhere. African Eagle’s tank leach tests also showed very fast reaction rates. The fast leaching reaction, low acid consumption and good nickel extraction shown by these tests are good indicators for the viability and profitability of the project. The transport cost of sulphur, likely from Dar es Salaam, ‘will be a constraint,' admits Parker, though the scoping study showed the project is viable and future developments such as planned upgrades to railways and a potential oil refinery in neighbouring Uganda would ease this.
African Eagle has also identified a pair of other nickel deposits close to Dutwa that could be extracted with the same processing plant. At Ngasamo, 5km to the west, the company has an agreement with its Czech and local owners to acquire 35% once it has completed a drilling programme currently under way, and up to 50% or 75% on further exploration, evaluation and feasibility work. African Eagle recently completed the first phase of this drilling programme, which will establish a JORC inferred resource and provide material for metallurgical testing. March’s drilling update showed good nickel grades at Ngasamo over a greater thickness than Dutwa, with 36m at 1.63% nickel including 15m at 2.37%, 51m at 1.18% nickel, 57m at 0.92% nickel including 42m at 1.04%, and 78m at 0.86% nickel including 27m at 1.1%, as well as 9m at 0.27% cobalt including 3m at 0.48% and 12m at 0.17% cobalt. More assay results announced this week continued along the same lines, showing 75m at 1.42% nickel, 84m at 1.07% nickel including 30m at 1.64%, 63m at 1.41% nickel including 45m at 1.71% and 57m at 1.25% nickel including 12m at 2.48%. Cobalt intercepts included 18m at 0.47% cobalt, 54m at 0.13%, 9m at 0.43% and 9m at 0.27% including 3m at 0.48%.
Furthermore, African Eagle holds the Zanzui nickel project, only 60km from Dutwa and ‘possibly twice as large’. Preliminary metallurgical tests showed that it shares the same low-acid leaching characteristics, with, adds Parker, ‘a little lower average nickel but good cobalt grades – so perhaps the value per tonne wouldn’t be so different from Dutwa. But we have to do more drilling there first.’
Seymour Pierce analyst Asa Bridle expects to add the new Ngasamo resource into his valuation metrics for the project shortly. Nevertheless, even at current levels he believes that the project is being underappreciated by the market: ‘with US$8.8 billion worth of nickel (340,000 tonnes at US$25,695 per tonne) already identified at Dutwa, there is clearly a disconnect between the project's value and AFE's market cap.’
The valuation should also include the rest of the portfolio that Parker has ‘backburnered’. This includes the Irugubi gold project in Tanzania, which has just been swapped with Aussie-listed Peak Resources for shares (around £2.6 million worth at the time), and a good half a dozen of Zambian projects that Parker says ‘are under negotiation’ and he ‘would consider any reasonable offer’ for.
Last August an African Eagle placing and an open offer together raised £3.4 million. To fund further developments past the pre-feasibility stage, more will be needed. To this end, Parker says he and industry guru chairman Euan Worthington are ‘talking to a number of potential strategic partners, some in the industry and others not’, adding that the company is proud of its record of being ‘s fair as possible to its existing shareholders’.
These investors have seen the shares fall from a year’s high of 11.32p to the present 4p, despite the strengthening of the nickel price. The forthcoming months should see ample news flow in the run-up to the PFS, promises Parker, two sets of new drill results and further metallurgical results from Dutwa, a resource estimate at Ngasamo, an upgrade of Dutwa’s resource estimate from inferred to indicated in a month or so and he hopes to a recalculation of the economics of the project to bring break-even costs down from their present $6.50per lb to nearer $5.50. Furthermore, Parker advises that the composition of the board is likely to change over coming years from explorers to miners as it moves closer towards development.
Like many AIM metals explorers, African Eagle has flattered to deceive in its time on the market. However, while it has stumbled in its attempts to advance projects, it has built up a not-insignificant brood of nickel, gold and copper exploration projects. Due to the company’s small size, management last year felt forced to choose between their babies. Although the glistering gold price might seem to make those projects attractive, African Eagle has decided to plump for its nickel assets, because of their sheer size and low cost of evaluation.
Managing director Mark Parker, one of the founders of the company with former chairman John Park, also explained to Proactive Investors that ‘the exploration risk is very low’ at its Dutwa nickel project and that the exceptional metallurgy of the site will allow for good recovery rates and low-cost extraction.
Located 100km east of the well connected mining city of Mwanza and close to the main Mwanza-Nairobi trunk road, Dutwa is a nickel laterite deposit. Laterites – near-surface deposits where over many years the weather has leached away more soluble elements to leave mineable concentrations of nickel and other less soluble elements such as iron and magnesium – can be extracted with acid leaching. They have been less favoured than the vein-style nickel sulphides that traditionally were the deposit of choice, due to some expensive ‘miss-steps’ such as BHP’s Ravensthorpe laterite project, which was eventually sold for a song after US$2.1 billion of investment. But more than two thirds of nickel now comes from laterites and Parker is confident that, due to the low iron content of the Dutwa deposit, the project is definitely economic. ‘We can do it for maybe a tenth of the usual capital cost,’ he assures. ‘If Ambatovy [in Madagascar] cost $4 billion, our capital cost, even using the slightly more expensive options like tank leaching, will be $350-$500 million.’
In 2008 African Eagle announced an initial Inferred Mineral Resource estimate for Dutwa of 31 million tonnes at an average grade of 1.1% nickel and 0.034% cobalt, with a contained metal endowment of some 340,000 tonnes of nickel and 11,000 tonnes of cobalt. The company believes the resource will increase following current step-out drilling and the delineation of the nearby Ngasamo deposit, also underway. A pre-feasibility study (PFS) for Dutwa is due at the end of calendar 2010 or in early 2011.
The metallurgy is key, though, explains Parker. ‘What we have is an average nickel content of about 1%-1.5%. But whereas some other companies’ more expensive projects have huge iron content of 30-40-50% and require high temperatures and high pressures to leach out the nickel, at our deposit nature has already done a lot of that work for us - so we have less than 10% iron and are low in magnesium and low in aluminium. So, yes, it’s not the highest grade but the metallurgy means that the extraction process is straightforward. We can process very straightforwardly with tank leaching or even cheaper heap leaching.’
Column leach tests at Dutwa gave 60% to 70% nickel extraction after just 16 days, rising to 90% after four months. This compares well against rival projects, where 540 days of leaching was required to extract 80% of the nickel at one trial heap elsewhere. African Eagle’s tank leach tests also showed very fast reaction rates. The fast leaching reaction, low acid consumption and good nickel extraction shown by these tests are good indicators for the viability and profitability of the project. The transport cost of sulphur, likely from Dar es Salaam, ‘will be a constraint,' admits Parker, though the scoping study showed the project is viable and future developments such as planned upgrades to railways and a potential oil refinery in neighbouring Uganda would ease this.
African Eagle has also identified a pair of other nickel deposits close to Dutwa that could be extracted with the same processing plant. At Ngasamo, 5km to the west, the company has an agreement with its Czech and local owners to acquire 35% once it has completed a drilling programme currently under way, and up to 50% or 75% on further exploration, evaluation and feasibility work. African Eagle recently completed the first phase of this drilling programme, which will establish a JORC inferred resource and provide material for metallurgical testing. March’s drilling update showed good nickel grades at Ngasamo over a greater thickness than Dutwa, with 36m at 1.63% nickel including 15m at 2.37%, 51m at 1.18% nickel, 57m at 0.92% nickel including 42m at 1.04%, and 78m at 0.86% nickel including 27m at 1.1%, as well as 9m at 0.27% cobalt including 3m at 0.48% and 12m at 0.17% cobalt. More assay results announced this week continued along the same lines, showing 75m at 1.42% nickel, 84m at 1.07% nickel including 30m at 1.64%, 63m at 1.41% nickel including 45m at 1.71% and 57m at 1.25% nickel including 12m at 2.48%. Cobalt intercepts included 18m at 0.47% cobalt, 54m at 0.13%, 9m at 0.43% and 9m at 0.27% including 3m at 0.48%.
Furthermore, African Eagle holds the Zanzui nickel project, only 60km from Dutwa and ‘possibly twice as large’. Preliminary metallurgical tests showed that it shares the same low-acid leaching characteristics, with, adds Parker, ‘a little lower average nickel but good cobalt grades – so perhaps the value per tonne wouldn’t be so different from Dutwa. But we have to do more drilling there first.’
Seymour Pierce analyst Asa Bridle expects to add the new Ngasamo resource into his valuation metrics for the project shortly. Nevertheless, even at current levels he believes that the project is being underappreciated by the market: ‘with US$8.8 billion worth of nickel (340,000 tonnes at US$25,695 per tonne) already identified at Dutwa, there is clearly a disconnect between the project's value and AFE's market cap.’
The valuation should also include the rest of the portfolio that Parker has ‘backburnered’. This includes the Irugubi gold project in Tanzania, which has just been swapped with Aussie-listed Peak Resources for shares (around £2.6 million worth at the time), and a good half a dozen of Zambian projects that Parker says ‘are under negotiation’ and he ‘would consider any reasonable offer’ for.
Last August an African Eagle placing and an open offer together raised £3.4 million. To fund further developments past the pre-feasibility stage, more will be needed. To this end, Parker says he and industry guru chairman Euan Worthington are ‘talking to a number of potential strategic partners, some in the industry and others not’, adding that the company is proud of its record of being ‘s fair as possible to its existing shareholders’.
These investors have seen the shares fall from a year’s high of 11.32p to the present 4p, despite the strengthening of the nickel price. The forthcoming months should see ample news flow in the run-up to the PFS, promises Parker, two sets of new drill results and further metallurgical results from Dutwa, a resource estimate at Ngasamo, an upgrade of Dutwa’s resource estimate from inferred to indicated in a month or so and he hopes to a recalculation of the economics of the project to bring break-even costs down from their present $6.50per lb to nearer $5.50. Furthermore, Parker advises that the composition of the board is likely to change over coming years from explorers to miners as it moves closer towards development.
Gold steady at $1,190 as FTSE 100 and Dow Jones slip below 5,000 and 10,000
Gold prices are slowly returning to US$1,200/oz, having reached US$1,190/oz on Tuesday following a recent freefall that pushed the prices from a record high of nearly US$1,250/oz to below US$1,175/oz. The decline came as investors were rapidly dumping assets including the safe-haven precious metals to offset losses from sharp declines in equity markets. Now, however, safe haven demand has returned as the markets remain in selling mode with the UK’s FTSE 100 and the Dow Jones Industrial Average standing well below the key 5,000 and 10,000 marks respectively.
Investors are facing uncertainty due to doubts that the recently agreed on €750 billion rescue fund will be sufficient to stop the debt crisis that has put Greece on the brink of bankruptcy from spreading into other euro zone states and the political destabilisation caused by the escalation of the tensions between South Korea and North Korea that could potential lead to a large scale military conflict.
Gold has been increasingly seen as a hedge against risks associated with volatility in currency and equity markets. Before the debt crisis kicked in to destabilise the euro and European markets, gold served as an investment alternative to the US dollar and moved inversely to the American currency and in tandem with the euro.
Other precious metals retreated after making gains earlier today with silver sliding to US$17.61/oz and platinum dropped to US$1,493/oz.
Major mining stocks fell today. Randgold Resources (LSE: RRS), platinum miner Lonmin (LSE: LMI) and silver miner Fresnillo (LSE: FRES) slipped 1.6%, 3.5% and 3.7% respectively.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) lost nearly 5%.
In the FTSE 250, silver producer Hochschild Mining (LSE: HOC), gold miner Petropavlovsk (LSE: POG) and Aquarius Platinum (LSE: AQP) slipped 3.1%, 4.8% and 6.7% respectively.
Commodity asset development company Mercator Gold (AIM: MCR) followed with a loss of 6.5%, while Philippines focused gold producer Medusa Mining (AIM&ASX: MML) and Fiji focused gold miner Vatukoula Gold Mines (AIM: VGM) slipped 6%.
http://www.proactiveinvestors.co.uk/companies/news/16938/gold-steady-at-1190-as-ftse-100-and-dow-jones-slip-below-5000-and-10000-16938.html
Investors are facing uncertainty due to doubts that the recently agreed on €750 billion rescue fund will be sufficient to stop the debt crisis that has put Greece on the brink of bankruptcy from spreading into other euro zone states and the political destabilisation caused by the escalation of the tensions between South Korea and North Korea that could potential lead to a large scale military conflict.
Gold has been increasingly seen as a hedge against risks associated with volatility in currency and equity markets. Before the debt crisis kicked in to destabilise the euro and European markets, gold served as an investment alternative to the US dollar and moved inversely to the American currency and in tandem with the euro.
Other precious metals retreated after making gains earlier today with silver sliding to US$17.61/oz and platinum dropped to US$1,493/oz.
Major mining stocks fell today. Randgold Resources (LSE: RRS), platinum miner Lonmin (LSE: LMI) and silver miner Fresnillo (LSE: FRES) slipped 1.6%, 3.5% and 3.7% respectively.
Specialty chemicals firm Johnson Matthey (LSE: JMAT) lost nearly 5%.
In the FTSE 250, silver producer Hochschild Mining (LSE: HOC), gold miner Petropavlovsk (LSE: POG) and Aquarius Platinum (LSE: AQP) slipped 3.1%, 4.8% and 6.7% respectively.
Commodity asset development company Mercator Gold (AIM: MCR) followed with a loss of 6.5%, while Philippines focused gold producer Medusa Mining (AIM&ASX: MML) and Fiji focused gold miner Vatukoula Gold Mines (AIM: VGM) slipped 6%.
http://www.proactiveinvestors.co.uk/companies/news/16938/gold-steady-at-1190-as-ftse-100-and-dow-jones-slip-below-5000-and-10000-16938.html
Crude drops to $68 as markets keep plummeting amid rising tensions in Korea
Oil prices continued falling today amid yet more declines in global equity markets, which further muddied the outlook for oil demand. European shares managed to recoup losses yesterday with the UK’s FTSE 100 closing above the opening level after a volatile session. However, a selloff in the US later on Monday that plunged the main indexes, the Dow Jones Industrial Average and the broader S&P 500 index, by more than 1%. The main factors behind the latest freefall were the jitters over the European debt crisis following the bailout of small savings bank CajaSur by the Bank of Spain and rising tensions on the Korean peninsula, where the prospect of the outbreak of a military conflict seems to be more realistic than at any time over the past 15 years.
The prices were unaffected by positive news from China, where a state official said that the country would have to implement a more cautious approach to introducing more monetary policy tightening measures to ease concerns over possible declines in oil demand from the world’s second largest energy consumer. China has implemented a series of policy tightening measures this year including upping ratio requirements for banks and lending restrictions in an attempt to curb inflation, which has come close to the government’s annual target of 3% amid rapid economic expansion.
Last week’s bullish inventories reports also failed to lift the prices. The American Petroleum Institute (API) reported a surprising decline in US crude stockpiles of nearly 0.8 million barrels, while an increase was expected. A more closely watched report from Energy Information Administration (EIA) showed a smaller than expected increase of 200,000 barrels in US stockpiles. EIA also said that gasoline stocks shed 300,000 barrels and distillates, which include diesel and heating oil, were down by 1 million barrels.
This week’s reports from the API and EIA are due today and tomorrow respectively.
July Brent Crude declined to US$69.12/barrel, while US light, sweet crude dropped to US$68.13/barrel.
Oil and gas supermajor BP (LSE: BP) once again was among the top fallers in the sector with a 3% loss as the oil spill disaster in the Gulf of Mexico doesn’t appear to be anywhere near end. The company now plans to pipe mud into a blowout preventer that is leaking oil into the sea and then cap the well with concrete. The high risk operation has a high chance of success, but could make the problem worse if it fails. The US government has warned the company that it could be removed from the clean-up operations after missing a series of deadlines and appearing to be unable to contain the spill.
Fellow supermajor Shell (LSE: RDSB) lost 2%, while BG Group (LSE: BG) shed 2.7% and Tullow Oil (LSE: TLW) and Cairn Energy (LSE: CNE) both declined 4%.
Engineering firms Amec (LSE: AMEC) and Petrofac (LSE: PFC) followed, moving down 5.2% and 4.1% re4spectively.
Midcaps also were in decline today. Dragon Oil (LSE: DGO) slipped 6.5%, while JKX Oil & Gas (LSE: JKX) dropped 5.7%, Salamander Energy (LSE: SMDR) and Dana Petroleum (LSE: DNX) lost 4.5%, Heritage Oil (LSE: HOIL) and Soco International (LSE: SIA) moved down 4%, Premier Oil (LSE: PMO) declined 3.5% and Melrose Resources (LSE: MRS) slid 1.25%.
Services companies got hit hard with Wood Group (LSE: WG) and Wellstream Holdings (LSE: WSM) plunging 8% and 5% respectively.
Most juniors followed. EU operating Rome-based oil junior Mediterranean Oil & Gas (AIM: MOG) and North Sea explorers Xcite Energy (AIM: XEL) slipped 12% and 11%, Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) and Africa and FSU operating oil and gas junior Victoria Oil & Gas (AIM: VOG) moved down 9%, Oil and gas company with assets in Iraq, Syria and Gulf of Mexico, Gulfsands Petroleum (AIM: GPX) and Ukraine focused gas producer Regal Petroleum (AIM: RPT) lost 8%, Atlantic Canada operating oil and gas group Enegi Oil (AIM: ENEG) and Eastern Europe focused junior Aurelian Oil & Gas (AIM: AUL) lost 7%. Irish oil and gas exploration company Petroceltic International (AIM: PCI) followed with a 6.5% loss.
US focused oil and gas junior Caza Oil & Gas (AIM: CAZA) went against the tide, climbing 5%.
http://www.proactiveinvestors.co.uk/companies/news/16937/crude-drops-to-68-as-markets-keep-plummeting-amid-rising-tensions-in-korea-16937.html
The prices were unaffected by positive news from China, where a state official said that the country would have to implement a more cautious approach to introducing more monetary policy tightening measures to ease concerns over possible declines in oil demand from the world’s second largest energy consumer. China has implemented a series of policy tightening measures this year including upping ratio requirements for banks and lending restrictions in an attempt to curb inflation, which has come close to the government’s annual target of 3% amid rapid economic expansion.
Last week’s bullish inventories reports also failed to lift the prices. The American Petroleum Institute (API) reported a surprising decline in US crude stockpiles of nearly 0.8 million barrels, while an increase was expected. A more closely watched report from Energy Information Administration (EIA) showed a smaller than expected increase of 200,000 barrels in US stockpiles. EIA also said that gasoline stocks shed 300,000 barrels and distillates, which include diesel and heating oil, were down by 1 million barrels.
This week’s reports from the API and EIA are due today and tomorrow respectively.
July Brent Crude declined to US$69.12/barrel, while US light, sweet crude dropped to US$68.13/barrel.
Oil and gas supermajor BP (LSE: BP) once again was among the top fallers in the sector with a 3% loss as the oil spill disaster in the Gulf of Mexico doesn’t appear to be anywhere near end. The company now plans to pipe mud into a blowout preventer that is leaking oil into the sea and then cap the well with concrete. The high risk operation has a high chance of success, but could make the problem worse if it fails. The US government has warned the company that it could be removed from the clean-up operations after missing a series of deadlines and appearing to be unable to contain the spill.
Fellow supermajor Shell (LSE: RDSB) lost 2%, while BG Group (LSE: BG) shed 2.7% and Tullow Oil (LSE: TLW) and Cairn Energy (LSE: CNE) both declined 4%.
Engineering firms Amec (LSE: AMEC) and Petrofac (LSE: PFC) followed, moving down 5.2% and 4.1% re4spectively.
Midcaps also were in decline today. Dragon Oil (LSE: DGO) slipped 6.5%, while JKX Oil & Gas (LSE: JKX) dropped 5.7%, Salamander Energy (LSE: SMDR) and Dana Petroleum (LSE: DNX) lost 4.5%, Heritage Oil (LSE: HOIL) and Soco International (LSE: SIA) moved down 4%, Premier Oil (LSE: PMO) declined 3.5% and Melrose Resources (LSE: MRS) slid 1.25%.
Services companies got hit hard with Wood Group (LSE: WG) and Wellstream Holdings (LSE: WSM) plunging 8% and 5% respectively.
Most juniors followed. EU operating Rome-based oil junior Mediterranean Oil & Gas (AIM: MOG) and North Sea explorers Xcite Energy (AIM: XEL) slipped 12% and 11%, Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) and Africa and FSU operating oil and gas junior Victoria Oil & Gas (AIM: VOG) moved down 9%, Oil and gas company with assets in Iraq, Syria and Gulf of Mexico, Gulfsands Petroleum (AIM: GPX) and Ukraine focused gas producer Regal Petroleum (AIM: RPT) lost 8%, Atlantic Canada operating oil and gas group Enegi Oil (AIM: ENEG) and Eastern Europe focused junior Aurelian Oil & Gas (AIM: AUL) lost 7%. Irish oil and gas exploration company Petroceltic International (AIM: PCI) followed with a 6.5% loss.
US focused oil and gas junior Caza Oil & Gas (AIM: CAZA) went against the tide, climbing 5%.
http://www.proactiveinvestors.co.uk/companies/news/16937/crude-drops-to-68-as-markets-keep-plummeting-amid-rising-tensions-in-korea-16937.html
Cluff Gold says company is not for sale at present, to focus on exploration drilling
Africa focused gold deposit developer Cluff Gold (LON:CLF, TSX:CFG) said that whilst it has granted permission to conduct due diligence to a few would-be buyers in the recent months, the company is not for sale unless it gets an offer at a “significant premium” to its recent three month trading average.
In its full-year results statement, it said it is the view of the board and senior management that otherwise, this is not the appropriate moment for the company to be sold.
At the end of April, it had told the market that discussions with regards to a possible offer for the company were ongoing. Back in February, Cluff initially confirmed that it had received an approach from an unnamed third party.
Today the group said it is consistently adding value to the ompany through its programme of optimising operations and further exploration drilling and it believes that the company's value will be further re-rated when its exploration in 2010 adds more ounces at all three of its projects. "We are determined to avoid any temptation to acquire additional interests in other countries until our cash flow can be relied upon to support such a move as well as funding our exploration plans," chairman and chief executice JG Cluff said.
During 2009, the company’s annualized production was close to the company’s 100,000 ounce target following the commissioning of the Kalsaka mine in Cote d’Ivoire and the Angovia mine in Burkina Faso. Cluff Gold expects to meet the target in 2010, also expecting the ongoing exploration programme at Angovia to extend its oxide life.
An initial drilling programme of 10,000m of reverse circulation drilling is planned to begin in Q2 2010 with an aim to increase resources, while a drilling programme is currently being undertaken at Angovia to increase overall resources and reserves.
The commissioning of the mines resulted in revenues of US$39.6 million in the year to end-Dcember 2009, compared to no revenues the previous year, while pre-tax losses rose from US$248,000 to US$35.5 million, resulting in losses per share of 30.25 US cents compared to last year’s loss of 1.08 US cents. The increase in losses was due to a US$21 million impairment charge against the Angovia mine. Pre-impairment losses stood at US$12.5 million, partially due to a one-off credit of US$9 million in respect of the acquisition of the remaining 40% of the Baomahun gold project in Sierra Leone in 2008.
The assets of the group at 31 December 2009 totalled US$113.9 million, compared to US$128.5 million at 31 December 2008. The decline was due to the Angovia impairment charge.
Meanwhile, the resources at the Baomahun project have increased to 1.1 Moz (million ounces) in the measured category and 1 Moz in the inferred category. Cluff Gold has already received a draft preliminary assessment, which is currently being finalised while the company is progressing the full feasibility study. The scoping study for Baomahun is expected in June 2010.
“We believe that the potential at Baomahun is considerably greater than our current understanding, and whilst we wish to conclude the development of a mine based on the current resource area, we are also focusing on extending our knowledge across the remainder of the 12km prospective belt in 2010,” said the chairman and CEO.
Cluff Gold offered a positive outlook for the current year, noting the rising gold prices that have recently set new record highs at nearly US$1,250/oz and currently remain close to US$1,200/oz, as well as the fact that the company’s operations are located in West Africa, which it called a “perhaps the most compelling mining destination in the world” with “sensible mining investment codes”, while remaining about the super tax on mining companies recently introduced by the government of Australia.
The company simultaneously reported additional assay results from Baomahun, which it said were encouraging with intersections grading up to 10.5 g/t (grammes per tonne) gold over 10 metres.
Other results included intercepts of 31 metres at 3.88 g/t gold, 9 metres at 4.38 g/t gold including 4 metres at 8.22 g/t gold, 2 metres at 5.99 g/t gold, 18 metres at 4.2 g/t gold including 3 metres at 11 g/t gold, 3 metres at 5.20 g/t gold, 38 metres at 5.43 g/t gold including 10 metres at 10.5 g/t gold and 2 metres at 12.1 g/t gold, 8 metres at 2 g/t gold, 12 metres at 1.78 g/t gold and 3 metres at 6.43 g/t gold.
In October, Cluff reported a 40% increase in the projects total mineral reserves. As a result, the inferred minerals resources increased to 9.2 million tones grading 3.2 g/t (grammes per tonne) or 957,000 oz (ounces) from 500,000 oz of gold, while the total measured and indicated resource now stands at 12 million tones grading 2.9 g/t for a total 1,103,000 ounces of gold.
A resource update is currently underway and is on schedule to be completed in Q2 2010.
In its full-year results statement, it said it is the view of the board and senior management that otherwise, this is not the appropriate moment for the company to be sold.
At the end of April, it had told the market that discussions with regards to a possible offer for the company were ongoing. Back in February, Cluff initially confirmed that it had received an approach from an unnamed third party.
Today the group said it is consistently adding value to the ompany through its programme of optimising operations and further exploration drilling and it believes that the company's value will be further re-rated when its exploration in 2010 adds more ounces at all three of its projects. "We are determined to avoid any temptation to acquire additional interests in other countries until our cash flow can be relied upon to support such a move as well as funding our exploration plans," chairman and chief executice JG Cluff said.
During 2009, the company’s annualized production was close to the company’s 100,000 ounce target following the commissioning of the Kalsaka mine in Cote d’Ivoire and the Angovia mine in Burkina Faso. Cluff Gold expects to meet the target in 2010, also expecting the ongoing exploration programme at Angovia to extend its oxide life.
An initial drilling programme of 10,000m of reverse circulation drilling is planned to begin in Q2 2010 with an aim to increase resources, while a drilling programme is currently being undertaken at Angovia to increase overall resources and reserves.
The commissioning of the mines resulted in revenues of US$39.6 million in the year to end-Dcember 2009, compared to no revenues the previous year, while pre-tax losses rose from US$248,000 to US$35.5 million, resulting in losses per share of 30.25 US cents compared to last year’s loss of 1.08 US cents. The increase in losses was due to a US$21 million impairment charge against the Angovia mine. Pre-impairment losses stood at US$12.5 million, partially due to a one-off credit of US$9 million in respect of the acquisition of the remaining 40% of the Baomahun gold project in Sierra Leone in 2008.
The assets of the group at 31 December 2009 totalled US$113.9 million, compared to US$128.5 million at 31 December 2008. The decline was due to the Angovia impairment charge.
Meanwhile, the resources at the Baomahun project have increased to 1.1 Moz (million ounces) in the measured category and 1 Moz in the inferred category. Cluff Gold has already received a draft preliminary assessment, which is currently being finalised while the company is progressing the full feasibility study. The scoping study for Baomahun is expected in June 2010.
“We believe that the potential at Baomahun is considerably greater than our current understanding, and whilst we wish to conclude the development of a mine based on the current resource area, we are also focusing on extending our knowledge across the remainder of the 12km prospective belt in 2010,” said the chairman and CEO.
Cluff Gold offered a positive outlook for the current year, noting the rising gold prices that have recently set new record highs at nearly US$1,250/oz and currently remain close to US$1,200/oz, as well as the fact that the company’s operations are located in West Africa, which it called a “perhaps the most compelling mining destination in the world” with “sensible mining investment codes”, while remaining about the super tax on mining companies recently introduced by the government of Australia.
The company simultaneously reported additional assay results from Baomahun, which it said were encouraging with intersections grading up to 10.5 g/t (grammes per tonne) gold over 10 metres.
Other results included intercepts of 31 metres at 3.88 g/t gold, 9 metres at 4.38 g/t gold including 4 metres at 8.22 g/t gold, 2 metres at 5.99 g/t gold, 18 metres at 4.2 g/t gold including 3 metres at 11 g/t gold, 3 metres at 5.20 g/t gold, 38 metres at 5.43 g/t gold including 10 metres at 10.5 g/t gold and 2 metres at 12.1 g/t gold, 8 metres at 2 g/t gold, 12 metres at 1.78 g/t gold and 3 metres at 6.43 g/t gold.
In October, Cluff reported a 40% increase in the projects total mineral reserves. As a result, the inferred minerals resources increased to 9.2 million tones grading 3.2 g/t (grammes per tonne) or 957,000 oz (ounces) from 500,000 oz of gold, while the total measured and indicated resource now stands at 12 million tones grading 2.9 g/t for a total 1,103,000 ounces of gold.
A resource update is currently underway and is on schedule to be completed in Q2 2010.
Chromex Mining secures US$5 million commodity loan
South Africa operating chrome miner Chromex Mining (LON:CHX) has secured US$5 million to provide funds for a DMS (dense media separation) circuit and ancillary plant improvements at its Stellite opencast chrome mine in the Bushveld Complex in South Africa, which will double its capacity to 40,000 tonnes per month.
The improvements are also expected to increase recovery margins and economic efficiencies at the plant.
The money comes in the form of a pre-payment from Chinese steel manufacturer Zuchou Kaiyuan Chemicals, which will be buying all lumpy chrome product for two years following the initial six month construction period. Chromex said that pricing will be “market driven” negotiated on a monthly basis and a percentage of each lumpy chrome consignment will be used to offset the pre-payment.
The construction of the DMS circuit has already begun with cold commissioning planned for October 2010, while a tailings thickener and spirals upgrade are expected to be commissioned in June 2010.
Stellite is expected reach full capacity by the first quarter of 2011 - producing approximately 500,000 run-of-mine tonnes per annum.
“This is a fantastic deal as it provides both a guaranteed off-take to China, our largest market, and allows for expansion without a dilutive effect on shareholders,” said chief executive Russell Lamming.
The company said that it was well positioned to capitalize on the rising demand for chrome with the doubling of production in South Africa, its recent acquisition in Zimbabwe and strong cash flows.
Earlier this month, the company acquired Waylox Mining (Private) Ltd, a chrome mining company operating in Zimbabwe and a wholly owned subsidiary of TransAfrika Resources Ltd for a total of US$1.15 million.
Astaire Securities welcomed the news, saying in its Morning Report the deal was “excellent news for shareholders” as it provided interest free and non-dilutive financing, but also guaranteed chromite sales for two years at market driven prices.
The broker added that the deal reflected the tight conditions in the chromite market.
“This type of commodity loan is only achievable in partnership with industry players like Suzhou, where securing supplies is the lender’s only real consideration,” Astaire said in the report.
Shares in the company rallied more than 16% on the announcement.
The improvements are also expected to increase recovery margins and economic efficiencies at the plant.
The money comes in the form of a pre-payment from Chinese steel manufacturer Zuchou Kaiyuan Chemicals, which will be buying all lumpy chrome product for two years following the initial six month construction period. Chromex said that pricing will be “market driven” negotiated on a monthly basis and a percentage of each lumpy chrome consignment will be used to offset the pre-payment.
The construction of the DMS circuit has already begun with cold commissioning planned for October 2010, while a tailings thickener and spirals upgrade are expected to be commissioned in June 2010.
Stellite is expected reach full capacity by the first quarter of 2011 - producing approximately 500,000 run-of-mine tonnes per annum.
“This is a fantastic deal as it provides both a guaranteed off-take to China, our largest market, and allows for expansion without a dilutive effect on shareholders,” said chief executive Russell Lamming.
The company said that it was well positioned to capitalize on the rising demand for chrome with the doubling of production in South Africa, its recent acquisition in Zimbabwe and strong cash flows.
Earlier this month, the company acquired Waylox Mining (Private) Ltd, a chrome mining company operating in Zimbabwe and a wholly owned subsidiary of TransAfrika Resources Ltd for a total of US$1.15 million.
Astaire Securities welcomed the news, saying in its Morning Report the deal was “excellent news for shareholders” as it provided interest free and non-dilutive financing, but also guaranteed chromite sales for two years at market driven prices.
The broker added that the deal reflected the tight conditions in the chromite market.
“This type of commodity loan is only achievable in partnership with industry players like Suzhou, where securing supplies is the lender’s only real consideration,” Astaire said in the report.
Shares in the company rallied more than 16% on the announcement.
Pennon ups FY profits and boosts dividend policy for coming years
In its preliminary results for the year ended 31 March 2010, FTSE250 utility Pennon Group (LSE: PNN) has reported a 14.2% increase in underlying profit to £189.1m. The company also announced its intention to increase its dividend by 4% per annum, above inflation, from next year until at least 2014/15.
"This has been another successful year for the group. During the year South West Water has delivered strong operational performance and has outperformed the operating cost efficiency and financing targets set by Ofwat for the K4 period (2005 - 2010 investment period)”, Pennon Chairman Ken Harvey commented.
Overall, the group’s full-year revenue broke through the £1bn mark for the first time, increasing 11.6% to £1.06bn. Pre-tax profits grew by 14.2% to £189.1m, and earnings per share increased 9.2% to 41.6p. Pennon said it has substantial cash resources and committed facilities, and consequently it is well placed in the current financial market conditions.
For the 2009/10 financial year, Pennon is recommending a final dividend of 15.6p per share, up 9.5% from the previous year, which along with the interim dividend of 6.95p, took the total dividend for the year to 22.55p, representing an increase of 7.4% on the previous financial year.
The improved performance was driven strongly by its waste management and recycling business Viridor, which contributed £55.4m following 34.8% growth in its underlying profits. “Viridor has once again delivered a very strong financial performance. The Greater Manchester Waste PFI contract, Lakeside Energy from Waste project and the latest acquisitions are further major steps forward in the successful evolution of Viridor”, Harvey added.
Furthermore, the company’s chairman also said he expects the business unit to continue to deliver strong long-term growth, particularly due to opportunities arising from the Government's landfill diversion, recycling and renewable energy targets.
"This has been another successful year for the group. During the year South West Water has delivered strong operational performance and has outperformed the operating cost efficiency and financing targets set by Ofwat for the K4 period (2005 - 2010 investment period)”, Pennon Chairman Ken Harvey commented.
Overall, the group’s full-year revenue broke through the £1bn mark for the first time, increasing 11.6% to £1.06bn. Pre-tax profits grew by 14.2% to £189.1m, and earnings per share increased 9.2% to 41.6p. Pennon said it has substantial cash resources and committed facilities, and consequently it is well placed in the current financial market conditions.
For the 2009/10 financial year, Pennon is recommending a final dividend of 15.6p per share, up 9.5% from the previous year, which along with the interim dividend of 6.95p, took the total dividend for the year to 22.55p, representing an increase of 7.4% on the previous financial year.
The improved performance was driven strongly by its waste management and recycling business Viridor, which contributed £55.4m following 34.8% growth in its underlying profits. “Viridor has once again delivered a very strong financial performance. The Greater Manchester Waste PFI contract, Lakeside Energy from Waste project and the latest acquisitions are further major steps forward in the successful evolution of Viridor”, Harvey added.
Furthermore, the company’s chairman also said he expects the business unit to continue to deliver strong long-term growth, particularly due to opportunities arising from the Government's landfill diversion, recycling and renewable energy targets.
De La Rue FY revenue up 12%, sees banknote volumes unchanged in current yr
Currency and passport printing specialist De La Rue (LSE: DLAR) said it had an “excellent year” in 2009 and delivered an “outstanding performance” as demand for its services increased despite an “uncertain economic environment,” leading to a 12% increase in revenues to £561.1 million.
Operating profits in the full year to 27 March 2010 jumped 13% to £109.2 million, while pre-tax profit improved 1% to £96.6 million. Earnings per share rose from 57 pence to 76.2 pence, leading to an increase in dividends to 42.3 pence from 41.1 pence.
Other financial highlights of the period included a profit margin of 19.5%, an operating cash flow of £116 million and the sale of Camelot investment. The company has also secured a 10-year £400 million UK passport contract.
The company offered a positive outlook, saying that banknote volumes will stay the same in 2010/11 but with a greater weighting towards the second half, while pension charges will increase by £3 million.
“The strong margin mix in Currency will not be repeated in the current financial year. It is expected that this will be offset by productivity gains, by cost reduction, especially in Cash Processing Solutions, and by improved trading in other parts of the business,” said chairman of De La Rue Nicholas Brookes.
Operating profits in the full year to 27 March 2010 jumped 13% to £109.2 million, while pre-tax profit improved 1% to £96.6 million. Earnings per share rose from 57 pence to 76.2 pence, leading to an increase in dividends to 42.3 pence from 41.1 pence.
Other financial highlights of the period included a profit margin of 19.5%, an operating cash flow of £116 million and the sale of Camelot investment. The company has also secured a 10-year £400 million UK passport contract.
The company offered a positive outlook, saying that banknote volumes will stay the same in 2010/11 but with a greater weighting towards the second half, while pension charges will increase by £3 million.
“The strong margin mix in Currency will not be repeated in the current financial year. It is expected that this will be offset by productivity gains, by cost reduction, especially in Cash Processing Solutions, and by improved trading in other parts of the business,” said chairman of De La Rue Nicholas Brookes.
Marks & Spencer reports higher revenues and profits in 2009, says worst of recession over
Retailer Marks & Spencer (LSE: MKS) declared an end to the worst part of the recession and called 2009 a good year, saying that performance improved in all areas, driving adjusted pre-tax profits up 4.6% from a yera earlier to £632.5 million as group revenues climbed 3.2% to £9.5 billion.
UK like-for-like sales were up 0.9%, general merchandise rose 1.6% and food sales improved +0.3%. Net debt was reduced by £422.4 million to £2.1 billion and earnings per share were up from 32.3 pence to 33.5 pence, leading the company to dish out £81 million in bonuses and declare a final dividend of 9.5 pence to bring the total dividend up to 15 pence.
Other highlights included an increase in clothing market share to 11% and online market share from 5.3% to 5.6%, a 27% jump in direct sales to £413 million, cost savings of £145 million and cash generation of £411.7 million.
Marks and Spencer has also said that its Project 2020 to make its warehousing and distribution network more cost efficient was on plan and it was targeting to become the world’s most sustainable retailer by 2015.
“Marks & Spencer has had a good year. We have improved performance in all core areas, demonstrating the resilience of the M&S brand. ...with the worst effects of the recession behind us, strong foundations in place, and our core values intact, I am confident that M&S is well set for growth,” said outgoing chairman Stuart Rose.
The company has appointed former Morrison’s (LSE: MRW) chief executive Marc Bolland as CEO and will identify a new chairman to replace Rose.
Marks and Spencer said that it had a “satisfactory start” to the first quarter, planning to release an update on Q1 sales on 7 July 2010.
Last year, through Project 2020, it set out the key elements of its plan to restructure its supply chain, implement new information systems and improve operational execution.
UK like-for-like sales were up 0.9%, general merchandise rose 1.6% and food sales improved +0.3%. Net debt was reduced by £422.4 million to £2.1 billion and earnings per share were up from 32.3 pence to 33.5 pence, leading the company to dish out £81 million in bonuses and declare a final dividend of 9.5 pence to bring the total dividend up to 15 pence.
Other highlights included an increase in clothing market share to 11% and online market share from 5.3% to 5.6%, a 27% jump in direct sales to £413 million, cost savings of £145 million and cash generation of £411.7 million.
Marks and Spencer has also said that its Project 2020 to make its warehousing and distribution network more cost efficient was on plan and it was targeting to become the world’s most sustainable retailer by 2015.
“Marks & Spencer has had a good year. We have improved performance in all core areas, demonstrating the resilience of the M&S brand. ...with the worst effects of the recession behind us, strong foundations in place, and our core values intact, I am confident that M&S is well set for growth,” said outgoing chairman Stuart Rose.
The company has appointed former Morrison’s (LSE: MRW) chief executive Marc Bolland as CEO and will identify a new chairman to replace Rose.
Marks and Spencer said that it had a “satisfactory start” to the first quarter, planning to release an update on Q1 sales on 7 July 2010.
Last year, through Project 2020, it set out the key elements of its plan to restructure its supply chain, implement new information systems and improve operational execution.
Prosperity Minerals invests £10 mln in formerly-controlled Liaoning Changqing Cement JV
Prosperity Minerals Holdings Ltd (AIM: PMHL) announced that its wholly-owned subsidiary Sintex International Holdings Ltd has entered into a conditional agreement to purchase a 25% equity interest in Liaoning Changqing Cement Co Ltd from Liaoning Yan Zhou Zhu Xing Cement Co Ltd, for RMB100 million (approximately £10 million).
Prosperity previously owned a 75% equity stake in Liaoning Changqing - which was sold as part of the company’s recent £385 million asset sale to TCC International Ltd (TCCI). The company said that since the transaction between Prosperity and TCC, the vendor of the 25% stake decided that it did not wish to be part of a joint venture with an unfamiliar party (TCCI).
Consequently, the vendor approached Prosperity to sell its equity stake. “Given that Prosperity has a long established relationship with both the Vendor and TCCI, and the directors believe that the price sought by the vendor is attractive, the directors believe that it would be in the interests of Prosperity and its shareholders for Prosperity to initially purchase the 25% equity interest in Liaoning Changqing," company stated.
Prosperity highlighted that Liaoning Changqing has recently completed the construction of a cement and clinker production line, which has a production capacity of 2 million tonnes per annum. Subsequently, the production line began trial production in March 2010, and the start of normal production is expected in September.
Furthermore, the company believe that it will have the opportunity to sell the 25% interest in Liaoning Changqing, at a higher valuation following commencement of normal production at the Liaoning plant.
The net asset value of Liaoning Changqing, as shown in the unaudited accounts as at 30 April 2010, was RMB 218.5 million (approximately £22.29 million).
Prosperity noted that it will treat the 25% equity interest in the joint venture as an investment, and it will not participate in the management and operation of Liaoning Changqing. The consideration will be satisfied in cash out of Prosperity's internal resources, and the consideration will have no material adverse effect on the financial position of Prosperity.
Additionally, the company does not expect the 25% stake to make a material contribution to the profit or loss of Prosperity for the financial year 2010-2011.
The company sold most of its Chinese cement business interests to TCCI in April 2010 in order to focus its investment strategy on its iron ore business and seek expansion into new markets in China.
Prosperity previously owned a 75% equity stake in Liaoning Changqing - which was sold as part of the company’s recent £385 million asset sale to TCC International Ltd (TCCI). The company said that since the transaction between Prosperity and TCC, the vendor of the 25% stake decided that it did not wish to be part of a joint venture with an unfamiliar party (TCCI).
Consequently, the vendor approached Prosperity to sell its equity stake. “Given that Prosperity has a long established relationship with both the Vendor and TCCI, and the directors believe that the price sought by the vendor is attractive, the directors believe that it would be in the interests of Prosperity and its shareholders for Prosperity to initially purchase the 25% equity interest in Liaoning Changqing," company stated.
Prosperity highlighted that Liaoning Changqing has recently completed the construction of a cement and clinker production line, which has a production capacity of 2 million tonnes per annum. Subsequently, the production line began trial production in March 2010, and the start of normal production is expected in September.
Furthermore, the company believe that it will have the opportunity to sell the 25% interest in Liaoning Changqing, at a higher valuation following commencement of normal production at the Liaoning plant.
The net asset value of Liaoning Changqing, as shown in the unaudited accounts as at 30 April 2010, was RMB 218.5 million (approximately £22.29 million).
Prosperity noted that it will treat the 25% equity interest in the joint venture as an investment, and it will not participate in the management and operation of Liaoning Changqing. The consideration will be satisfied in cash out of Prosperity's internal resources, and the consideration will have no material adverse effect on the financial position of Prosperity.
Additionally, the company does not expect the 25% stake to make a material contribution to the profit or loss of Prosperity for the financial year 2010-2011.
The company sold most of its Chinese cement business interests to TCCI in April 2010 in order to focus its investment strategy on its iron ore business and seek expansion into new markets in China.
Thor Mining identifies seven potential drill targets at Harts Range in Australia’s Northern Territory
Thor Mining (ASX, AIM: THR) told investors that it has identified at least seven electromagnetic (EM) anomalies, with potential for future drilling, at the Harts Range exploration licence (EL24735) northeast of Alice Springs in Australia’s Northern Territory.
The anomalies where identified through the interpretation of a helicopter-borne Airborne Electromagnetic Survey. The survey consisted of 49 flight line traverses flown in a north south direction for a total of 314 line kilometres.
Modelling and interpretation of the survey data has enabled Thor to identify one “Priority 1” anomaly and six “Priority 2” anomalies sourced by potential bedrock conductors and detected at depth of less than 100m below surface.
The company said the cluster of anomalies at the western end of the license, and in particular the Priority 1 anomaly, are associated with layered amphibolitic rocks and are considered prospective for nickel, copper, gold and platinum group element mineralisation.
Thor chairman Mick Billing noted that the company has proposed a follow-up ground survey in order to better characterise and delineate the selected anomalies, and to enable the design of a drilling program to target their source.
Separately, Thor also reported a proposed AUD$150,000 fundraising, with a placing of 10 million voting CDI’s (CHESS Depository Interest) securities at 1.5 cents each. Thor also issued 5 million free attaching options to Western Desert Resources (ASX: WDR).
According to Billing, the cash raised from the issue will be used by the company to supplement working capital along with exploration expenses for the Dundas gold project.
The completion of the placement and the receipt of funds will take place within the next week, and Thor said it intends to make an application to ASX Securities Limited for listing of the CDI’s securities in due course.
The Australian resource company has several projects across a number of metal commodities, it operations are primarily focussed on the Northern Territory and Western Australia. One of the company’s flagship projects, the advanced Molyhill molybdenum-tungsten is poised to recommence as the company awaits improved economics.
Back in November 2009 the company announced that Molyhil was on hold due to the depressed price of molybdenum.
In April, Thor noted the increase in tungsten and molybdenum prices, which bode well for the restart of the development of its Molyhil project in Australia. The price of molybdenum roasted concentrates has increased to US$17.50/lb from a low of US$8/lb in April 2009, while tungsten prices have risen from US$185/mtu in July 2009 to the current US$215-220/mtu.
However, steps were taken to conserve cash levels, and Thor said that whilst prices were still below level that would make the project economic, if trends continue at the same pace, the Molyhil development would proceed as the fundamentals of the project were “sound".
Whilst Molyhill has been on hold, Thor has been actively progressing the other prospective projects in its portfolio, with particular emphasis on the recently acquired Dundas Gold project and the Harts Range license.
Along with the realisation of its new expanded exploration and acquisition strategy, announced in February 2010, Thor initially proposed its acquisition of three mining tenements in Western Australia - which were subsequently known as the Dundas Gold project.
Geologically, the Dundas project lies within the Albany-Fraser Province, which covers more than 50,000 square kilometres at the south-eastern margin of the gold-rich Yilgarn Province. The most notable gold discovery in Albany-Fraser is the 5 million ounce (Moz) Tropicana gold deposit. Prior to the Tropicana discovery the province was hardly explored for gold.
Specifically, the tenements are located in a part of the Albany-Fraser Province where the south-westerly grain of the Province is displaced south-eastwards by about 50 kilometres. “The overprint of a south-easterly structure appears to mimic elements of the Tropicana geology and apparently creates opportunities for dilation of the rock sequence - a structural element generally favourable for mineralisation”, Thor stated
The Dundas area has never been explored in detail and no drilling has been conducted within the boundaries of these tenements. Previously a limited, 40 square kilometre surface geochemical program conducted by BHP Billiton (LSE: BLT, ASX: BHP) revealed gold anomalies comparable with those associated with gold mineralisation elsewhere in the Wiluna-Kalgoorlie-Norseman greenstone belt. According to Thor, these anomalies are drill ready and untested.
In all, 335 square kilometres of the Dundas project remains unexplored.
In April, Thor told investors that the first phase of exploration at Dundas had commenced, with a soil sampling program underway, covering parts of the project not explored by the previous sampling. The company plans to start drilling later this year.
The anomalies where identified through the interpretation of a helicopter-borne Airborne Electromagnetic Survey. The survey consisted of 49 flight line traverses flown in a north south direction for a total of 314 line kilometres.
Modelling and interpretation of the survey data has enabled Thor to identify one “Priority 1” anomaly and six “Priority 2” anomalies sourced by potential bedrock conductors and detected at depth of less than 100m below surface.
The company said the cluster of anomalies at the western end of the license, and in particular the Priority 1 anomaly, are associated with layered amphibolitic rocks and are considered prospective for nickel, copper, gold and platinum group element mineralisation.
Thor chairman Mick Billing noted that the company has proposed a follow-up ground survey in order to better characterise and delineate the selected anomalies, and to enable the design of a drilling program to target their source.
Separately, Thor also reported a proposed AUD$150,000 fundraising, with a placing of 10 million voting CDI’s (CHESS Depository Interest) securities at 1.5 cents each. Thor also issued 5 million free attaching options to Western Desert Resources (ASX: WDR).
According to Billing, the cash raised from the issue will be used by the company to supplement working capital along with exploration expenses for the Dundas gold project.
The completion of the placement and the receipt of funds will take place within the next week, and Thor said it intends to make an application to ASX Securities Limited for listing of the CDI’s securities in due course.
The Australian resource company has several projects across a number of metal commodities, it operations are primarily focussed on the Northern Territory and Western Australia. One of the company’s flagship projects, the advanced Molyhill molybdenum-tungsten is poised to recommence as the company awaits improved economics.
Back in November 2009 the company announced that Molyhil was on hold due to the depressed price of molybdenum.
In April, Thor noted the increase in tungsten and molybdenum prices, which bode well for the restart of the development of its Molyhil project in Australia. The price of molybdenum roasted concentrates has increased to US$17.50/lb from a low of US$8/lb in April 2009, while tungsten prices have risen from US$185/mtu in July 2009 to the current US$215-220/mtu.
However, steps were taken to conserve cash levels, and Thor said that whilst prices were still below level that would make the project economic, if trends continue at the same pace, the Molyhil development would proceed as the fundamentals of the project were “sound".
Whilst Molyhill has been on hold, Thor has been actively progressing the other prospective projects in its portfolio, with particular emphasis on the recently acquired Dundas Gold project and the Harts Range license.
Along with the realisation of its new expanded exploration and acquisition strategy, announced in February 2010, Thor initially proposed its acquisition of three mining tenements in Western Australia - which were subsequently known as the Dundas Gold project.
Geologically, the Dundas project lies within the Albany-Fraser Province, which covers more than 50,000 square kilometres at the south-eastern margin of the gold-rich Yilgarn Province. The most notable gold discovery in Albany-Fraser is the 5 million ounce (Moz) Tropicana gold deposit. Prior to the Tropicana discovery the province was hardly explored for gold.
Specifically, the tenements are located in a part of the Albany-Fraser Province where the south-westerly grain of the Province is displaced south-eastwards by about 50 kilometres. “The overprint of a south-easterly structure appears to mimic elements of the Tropicana geology and apparently creates opportunities for dilation of the rock sequence - a structural element generally favourable for mineralisation”, Thor stated
The Dundas area has never been explored in detail and no drilling has been conducted within the boundaries of these tenements. Previously a limited, 40 square kilometre surface geochemical program conducted by BHP Billiton (LSE: BLT, ASX: BHP) revealed gold anomalies comparable with those associated with gold mineralisation elsewhere in the Wiluna-Kalgoorlie-Norseman greenstone belt. According to Thor, these anomalies are drill ready and untested.
In all, 335 square kilometres of the Dundas project remains unexplored.
In April, Thor told investors that the first phase of exploration at Dundas had commenced, with a soil sampling program underway, covering parts of the project not explored by the previous sampling. The company plans to start drilling later this year.
Herencia Resources latest assays from Paguanta extend high grade Cathedral vein
Herencia Resources (AIM: HER) has reported a high grade strike extension to the Cathedral vein at its flagship Paguanta zinc-silver-lead-gold project in northern Chile. The company received assay results from a further four holes in the current diamond drill program.
The highlights from holes PTDD042-045 include drill hole PTDD043 which intersected high grade mineralisation approximately 50m to the east of PTDD041, which previously reported high grade intersects.
"The consistency of mineralisation seen in both PTDD041 and PTDD043 is very encouraging, as is the grade and thickness of the high grade interval”, Herencia Resources MD Michael Bohm commented. “An important point to note is that whilst zinc remains the primary metal at Paguanta, the high lead and silver grades achieved in these holes are excellent”.
The best intersect encountered in PTDD043 consisted of 7.5 metres at 7.1% zinc, 7.3% lead, 324 grams per tonne (gpt) silver and 0.20gpt gold, from a depth of 189.5m and included a higher grading 4.95m at 9.5% zinc, 10.6% lead, 467gpt silver and 0.22gpt gold.
Herencia noted that PTDD043 effectively extends the Cathedral vein by a further 50m eastwards, and the vein still remains open to the east and at depth.
“The program remains on track to be in a position to potentially commence a Feasibility Study in 4Q2010", Bohm added.
At Paguanta, Herencia has completed approximately 3,700m of drilling to date, with approximately 1,800m of the scheduled drilling remaining. The company said that drilling is scheduled for completion by early-July 2010, to accommodate an additional 2,000m extension to the original 3,500m drill program as a result of early, positive assay results.
Herencia expect that all assay results will be returned by end-July 2010, with an update to the Mineral Resource Estimate expected by late August/early September 2010.
The Paguanta project currently has an indicated and inferred mineral resource of 3.15 Mt at 3.9 percent zinc, 1.3 percent lead and 74 g/t silver including a higher grade component of 1.01 Mt at 6.6 percent zinc, 2.2 percent lead and 119pm silver.
The drill programme began in February this year, and it aims to test the depth extension potential of the known mineralisation, test the potential for eastern and western expansion and gather information in respect to gold potential. Most importantly, the programme is expected to help update the mineral resource estimate and provide the basis to move the project towards a feasibility study.
The highlights from holes PTDD042-045 include drill hole PTDD043 which intersected high grade mineralisation approximately 50m to the east of PTDD041, which previously reported high grade intersects.
"The consistency of mineralisation seen in both PTDD041 and PTDD043 is very encouraging, as is the grade and thickness of the high grade interval”, Herencia Resources MD Michael Bohm commented. “An important point to note is that whilst zinc remains the primary metal at Paguanta, the high lead and silver grades achieved in these holes are excellent”.
The best intersect encountered in PTDD043 consisted of 7.5 metres at 7.1% zinc, 7.3% lead, 324 grams per tonne (gpt) silver and 0.20gpt gold, from a depth of 189.5m and included a higher grading 4.95m at 9.5% zinc, 10.6% lead, 467gpt silver and 0.22gpt gold.
Herencia noted that PTDD043 effectively extends the Cathedral vein by a further 50m eastwards, and the vein still remains open to the east and at depth.
“The program remains on track to be in a position to potentially commence a Feasibility Study in 4Q2010", Bohm added.
At Paguanta, Herencia has completed approximately 3,700m of drilling to date, with approximately 1,800m of the scheduled drilling remaining. The company said that drilling is scheduled for completion by early-July 2010, to accommodate an additional 2,000m extension to the original 3,500m drill program as a result of early, positive assay results.
Herencia expect that all assay results will be returned by end-July 2010, with an update to the Mineral Resource Estimate expected by late August/early September 2010.
The Paguanta project currently has an indicated and inferred mineral resource of 3.15 Mt at 3.9 percent zinc, 1.3 percent lead and 74 g/t silver including a higher grade component of 1.01 Mt at 6.6 percent zinc, 2.2 percent lead and 119pm silver.
The drill programme began in February this year, and it aims to test the depth extension potential of the known mineralisation, test the potential for eastern and western expansion and gather information in respect to gold potential. Most importantly, the programme is expected to help update the mineral resource estimate and provide the basis to move the project towards a feasibility study.
Mercator Gold reports ‘highly encouraging’ new NI43-101 resource at Copper Flat project
Mercator Gold (AIM: MCR, OTC: MTGDY) has reported a new NI43-101 Resource Estimate for the Copper Flat project in New Mexico, USA, with 107 million short tons grading an average of 0.303% copper in the Indicated resource category and 46 million short tons grading an average of 0.240% copper in the inferred category.
The resource estimate, which was conducted by SRK Consulting, is stated above a 0.12% copper cut-off and contained within a potentially economic open pit.
“We are highly encouraged by the results of the SRK resource estimate for the Copper Flat deposit, which is stated at a cut-off grade that reflects current expectations”, Mercator Gold MD Patrick Harford said. “[it] will underpin the preliminary assessment being completed by SRK in advance of the Copper Flat project’s listing on the TSX Venture Exchange through the proposed transaction with THEMAC Resources Group Limited”.
Mercator noted that, after a review of several scenarios considering different metal prices, design criteria and operating cost assumptions, SRK assumed a copper price of US$3.50/lb; a metallurgical recovery of 90.9%; mining costs of US$1.72/short ton mined; processing and G&A costs of US$5.49/short ton processed; and slope angles of 45º in all areas.
Copper Flat is a former producing mine with substantial infrastructure still in place. The Copper Flat deposit has historic reserves of 50.21 million short tons at an average grade of 0.45% copper, 0.1244 g/t gold, 2.053 g/t silver and 0.015% molybdenum, based on a cut-off grade of 0.23% copper.
On the basis of current historic reserves and assuming metal prices of US$3/lb copper, US$10/lb molybdenum, US$900/oz gold and US$13/oz silver, the Copper Flat project is estimated to have an NPV (net present value) of US$348 million and an IRR (internal rate of return) of 45%, assuming initial capital costs of US$115 million for the recommencement of production and a discount rate of 8%. The current price of copper is US$3.53/lb.
Mercator’s new business model is focused on acquiring interests in promising assets, adding value, then either spinning them into new vehicles or vending into other companies while retaining a material stake. “The market has a limited tolerance for small cap companies...” Patrick Hartford said to Proactiveinvestors in March “…we are aiming to spot the value in projects and make them go faster…”
In March, Mercator agreed the sale of its entire interest in the New Mexico Copper Company Inc (NMCC), which holds the rights over the project, to THEMAC Resources Group (TSX-V: MAC.H). As a result of the sale, Mercator will acquire a substantial interest in THEMAC to retain a very significant interest in Copper Flat project’s future development.
The company told investors in April that it had fulfilled its objectives in relation to the copper flat, primarily confirming the historic resource. Previously a seven hole drilling programme, totaling 5,041ft was concluded in February.
The resource estimate, which was conducted by SRK Consulting, is stated above a 0.12% copper cut-off and contained within a potentially economic open pit.
“We are highly encouraged by the results of the SRK resource estimate for the Copper Flat deposit, which is stated at a cut-off grade that reflects current expectations”, Mercator Gold MD Patrick Harford said. “[it] will underpin the preliminary assessment being completed by SRK in advance of the Copper Flat project’s listing on the TSX Venture Exchange through the proposed transaction with THEMAC Resources Group Limited”.
Mercator noted that, after a review of several scenarios considering different metal prices, design criteria and operating cost assumptions, SRK assumed a copper price of US$3.50/lb; a metallurgical recovery of 90.9%; mining costs of US$1.72/short ton mined; processing and G&A costs of US$5.49/short ton processed; and slope angles of 45º in all areas.
Copper Flat is a former producing mine with substantial infrastructure still in place. The Copper Flat deposit has historic reserves of 50.21 million short tons at an average grade of 0.45% copper, 0.1244 g/t gold, 2.053 g/t silver and 0.015% molybdenum, based on a cut-off grade of 0.23% copper.
On the basis of current historic reserves and assuming metal prices of US$3/lb copper, US$10/lb molybdenum, US$900/oz gold and US$13/oz silver, the Copper Flat project is estimated to have an NPV (net present value) of US$348 million and an IRR (internal rate of return) of 45%, assuming initial capital costs of US$115 million for the recommencement of production and a discount rate of 8%. The current price of copper is US$3.53/lb.
Mercator’s new business model is focused on acquiring interests in promising assets, adding value, then either spinning them into new vehicles or vending into other companies while retaining a material stake. “The market has a limited tolerance for small cap companies...” Patrick Hartford said to Proactiveinvestors in March “…we are aiming to spot the value in projects and make them go faster…”
In March, Mercator agreed the sale of its entire interest in the New Mexico Copper Company Inc (NMCC), which holds the rights over the project, to THEMAC Resources Group (TSX-V: MAC.H). As a result of the sale, Mercator will acquire a substantial interest in THEMAC to retain a very significant interest in Copper Flat project’s future development.
The company told investors in April that it had fulfilled its objectives in relation to the copper flat, primarily confirming the historic resource. Previously a seven hole drilling programme, totaling 5,041ft was concluded in February.
Ovoca Gold plans to buy back up to 10 pct of its shares on the market
Ovoca Gold PLC (AIM: OVG) said it intends to shortly seek to put in place the necessary authorities to repurchase up to 10 percent of the company's issued share capital by way of on-market share buy backs. The company does not currently have any authority to repurchase its own shares.
Ovaca said it has a strong balance sheet - US$43 mln in net cash and securities, or 34 pence per share - and in recent months has completed a significant corporate acquisition, undertaken operational activities across its portfolio of assets and made a number of board and management changes. However, despite such activities, the company's market capitalisation continues to trade at a substantial discount to the value of its cash and other liquid investments.
Shares in the group started trading in positive territory while most stocks on AIM and the wider market took another nasty beating in early trades today. Ovoca opened up 1.2 percent at 21p on the buy-back news.
Having the authority to repurchase its shares, will enable the company to respond to volatile stock market conditions, help stimulate liquidity in its shares and provide shareholders with the flexibility, but without any compulsion, to realise value in respect of all or some of their shareholdings in a tax efficient method, the company said in its statement.
Share buy backs will only be executed when appropriate financial and stock market conditions prevail and when the board determines that they are in the interests of the company and its shareholders as a whole.
A circular containing further details on the proposed buy back authorities and convening an extraordinary general meeting of the company, to be held on the day of the company's next annual general meeting in July 2010, will be posted to Shareholders with the 2009 Annual Report.
CEO Tim McCutcheon commented: "I believe this share buy-back is an important step for Ovoca and is part of the foundation for long-term shareholder value. We have an excellent multi disciplined and experienced team who are working on a portfolio of exciting gold assets and we are well funded for several years of operations.
“Ovoca has a proven track record of successfully developing precious metals assets in Russia and utilizing those assets to create value for shareholders. The sale of Goltsovoye in 2009 at a 194% premium to our market capitalisation at the time demonstrates this. Despite this, the company's market capitalization has traded below the value of the company's cash and securities position for over a year. The buy-back programme will allow the board to create additional value for the benefit of our shareholders," McCutcheon added.
Mineral exploration and mine development company Ovoca Gold is listed on AIM and on the ESM market of the Irish Stock Exchange (Ticker: OVX). Its principal activity is gold exploration in the Magadan region of the Russian Federation.
Previously Ovoca acquired, developed and sold to JSC Polymetal the Goltsovoye silver project located in the Magadan region. Currently, Ovoca is aggressively exploring and developing its 100 percent owned Stakhanovsky, Rassoshinskaya and Nevsko-Pestrinskoye licenses.
Stakhanovsky is located approximately 40 kilometres north of Susuman, the second largest city in the Magadan region. It is accessible by year-round road and there is power infrastructure on site. Internal preliminary estimates suggest a gold resource (non JORC code of Russian standard compliant) of over 700,000 ounces. The company intends to put Stakhanovsky into production by 2013.
Rassoshinskaya is in the North Eastern part of the Magadan region about 200 kilometres from the town of Simchan. There is no nearby infrastructure. Rassoshinskaya hosts an epithermal gold deposit named Olcha, which is the focus of Ovoca's exploration program. Olcha and nearby satellite deposits have the potential to host a high grade multi-million ounce gold resource.
Nevsko-Pestrinskoye is located in the central part of the Magadan region near the town of Omsukchan. A year-round road and powerline are near the site. The license completely surrounds the Goltsovoye silver deposit, which was owned by the Company from 2006 - 2009 and sold to JSC Polymetal for US$47.7 million at the time of closing. Ovoca intends to investigate and explore known mineral occurrences that extend beyond the Goltsovoye license area onto Nevsko-Pestrinskoye.
Ovaca said it has a strong balance sheet - US$43 mln in net cash and securities, or 34 pence per share - and in recent months has completed a significant corporate acquisition, undertaken operational activities across its portfolio of assets and made a number of board and management changes. However, despite such activities, the company's market capitalisation continues to trade at a substantial discount to the value of its cash and other liquid investments.
Shares in the group started trading in positive territory while most stocks on AIM and the wider market took another nasty beating in early trades today. Ovoca opened up 1.2 percent at 21p on the buy-back news.
Having the authority to repurchase its shares, will enable the company to respond to volatile stock market conditions, help stimulate liquidity in its shares and provide shareholders with the flexibility, but without any compulsion, to realise value in respect of all or some of their shareholdings in a tax efficient method, the company said in its statement.
Share buy backs will only be executed when appropriate financial and stock market conditions prevail and when the board determines that they are in the interests of the company and its shareholders as a whole.
A circular containing further details on the proposed buy back authorities and convening an extraordinary general meeting of the company, to be held on the day of the company's next annual general meeting in July 2010, will be posted to Shareholders with the 2009 Annual Report.
CEO Tim McCutcheon commented: "I believe this share buy-back is an important step for Ovoca and is part of the foundation for long-term shareholder value. We have an excellent multi disciplined and experienced team who are working on a portfolio of exciting gold assets and we are well funded for several years of operations.
“Ovoca has a proven track record of successfully developing precious metals assets in Russia and utilizing those assets to create value for shareholders. The sale of Goltsovoye in 2009 at a 194% premium to our market capitalisation at the time demonstrates this. Despite this, the company's market capitalization has traded below the value of the company's cash and securities position for over a year. The buy-back programme will allow the board to create additional value for the benefit of our shareholders," McCutcheon added.
Mineral exploration and mine development company Ovoca Gold is listed on AIM and on the ESM market of the Irish Stock Exchange (Ticker: OVX). Its principal activity is gold exploration in the Magadan region of the Russian Federation.
Previously Ovoca acquired, developed and sold to JSC Polymetal the Goltsovoye silver project located in the Magadan region. Currently, Ovoca is aggressively exploring and developing its 100 percent owned Stakhanovsky, Rassoshinskaya and Nevsko-Pestrinskoye licenses.
Stakhanovsky is located approximately 40 kilometres north of Susuman, the second largest city in the Magadan region. It is accessible by year-round road and there is power infrastructure on site. Internal preliminary estimates suggest a gold resource (non JORC code of Russian standard compliant) of over 700,000 ounces. The company intends to put Stakhanovsky into production by 2013.
Rassoshinskaya is in the North Eastern part of the Magadan region about 200 kilometres from the town of Simchan. There is no nearby infrastructure. Rassoshinskaya hosts an epithermal gold deposit named Olcha, which is the focus of Ovoca's exploration program. Olcha and nearby satellite deposits have the potential to host a high grade multi-million ounce gold resource.
Nevsko-Pestrinskoye is located in the central part of the Magadan region near the town of Omsukchan. A year-round road and powerline are near the site. The license completely surrounds the Goltsovoye silver deposit, which was owned by the Company from 2006 - 2009 and sold to JSC Polymetal for US$47.7 million at the time of closing. Ovoca intends to investigate and explore known mineral occurrences that extend beyond the Goltsovoye license area onto Nevsko-Pestrinskoye.
Morning news wrap: Marks & Spencer, Prudential, BP, Gulf Keystone Petroleum
In the FTSE 100, retailer Marks & Spencer (LSE: MKS) said that group revenues rose 3.2% in the year to 3 April 2010 to £9.5 billion.
Insurer Prudential (LSDE: PRU) said it had successfully listed on the main board Stock Exchange of Hong Kong Limited and on the Singapore Exchange Securities Trading Limited.
Oil and gas supermajor BP (LSE: BP) provided an update on the Gulf of Mexico oil spill, saying it had developed plans for a series of interventions via the blow out preventer, anticipating to commence them in the next few days.
In AIM, South Africa operating chrome miner Chromex Mining (AIM: CHX) has secured US$5 million funding for a Dense Media Separation circuit and ancillary plant improvements at the Stellite opencast chrome mine located on the western limb of the Bushveld Complex in South Africa.
Commodity asset development company Mercator Gold (AIM: MCR) the mineral resources of the Copper Flat copper-molybdenum-gold-silver deposit located in New Mexico, USA have been estimated by SRK Consulting at 107 million short tons grading an average of 0.303% copper classified as indicated resources with an additional 46 million short tons grading an average of 0.240% copper classified as inferred resources.
Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) has raised US$165 million to progress the three Shaikhan appraisal wells in the Kurdistan region of northern Iraq.
Africa focused gold deposit developer Cluff Gold (AIM: CLF) said it had received positive assay results from the Baomahun project in Sierra Leone, which include an intersection of 38 metres grading 5.43 g/t (grammes per tonne) gold.
http://www.proactiveinvestors.co.uk/companies/news/16907/morning-news-wrap-marks-spencer-prudential-bp-gulf-keystone-petroleum-16907.html
Insurer Prudential (LSDE: PRU) said it had successfully listed on the main board Stock Exchange of Hong Kong Limited and on the Singapore Exchange Securities Trading Limited.
Oil and gas supermajor BP (LSE: BP) provided an update on the Gulf of Mexico oil spill, saying it had developed plans for a series of interventions via the blow out preventer, anticipating to commence them in the next few days.
In AIM, South Africa operating chrome miner Chromex Mining (AIM: CHX) has secured US$5 million funding for a Dense Media Separation circuit and ancillary plant improvements at the Stellite opencast chrome mine located on the western limb of the Bushveld Complex in South Africa.
Commodity asset development company Mercator Gold (AIM: MCR) the mineral resources of the Copper Flat copper-molybdenum-gold-silver deposit located in New Mexico, USA have been estimated by SRK Consulting at 107 million short tons grading an average of 0.303% copper classified as indicated resources with an additional 46 million short tons grading an average of 0.240% copper classified as inferred resources.
Iraq and Algeria operating Gulf Keystone Petroleum (AIM: GKP) has raised US$165 million to progress the three Shaikhan appraisal wells in the Kurdistan region of northern Iraq.
Africa focused gold deposit developer Cluff Gold (AIM: CLF) said it had received positive assay results from the Baomahun project in Sierra Leone, which include an intersection of 38 metres grading 5.43 g/t (grammes per tonne) gold.
http://www.proactiveinvestors.co.uk/companies/news/16907/morning-news-wrap-marks-spencer-prudential-bp-gulf-keystone-petroleum-16907.html
FTSE 100 to slip below 5,000 as Korean tensions rise, European debt fears persist
The FTSE 100 is set to decline sharply today and go below 5,000 yet again on renewed fears over the European debt crisis following yesterday’s bailout of a savings bank by the Bank of Spain and concerns over the situation on the Korean Peninsula, where North Korea has declared it is combat ready after UN Secretary General called on the Security Council to impose sanctions in response to the sinking of a South Korean ship, apparently torpedoed by the communist state and the US and South Korea held military exercises in preparation to defend S Korea against possible aggression.
The UK’s blue chip index is seen 2.3% lower after tacking on 0.1% yesterday.
Insurer Prudential (LSE: PRU) and beverage group SABMiller (LSE: SAB) led the blue chips, advancing 2.5%. Consumer goods company Reckitt Benckiser (LSE: RB), chipmaker ARM Holdings (LSE: ARM) and Imperial Tobacco Group (LSE: IMT) followed, adding slightly more than 2%. Miner Anglo American (LSE: AAL) and retailer Marks & Spencer (LSE: MKS) climbed 2%.
BP (LSE: BP) was at the bottom of the pile, shedding nearly 3% after the US government threatened to remove the oil and gas supermajor from the ongoing clean-up operation in the Gulf of Mexico after it missed a series of deadlines and appeared unable to contain the oil spill. Outsourcing group Capita (LSE: CPI), oil and gas company Cairn Energy (LSE: CNE) and engineering firm Invensys (LSE: ISYS) lost more than 2%. Another oil and gas supermajor Shell (LSE: RDSB) declined 1.8% and asset management firm Schroders (LSE: SDR) lost 1.4%.
US stocks closed with big losses on Monday and are set to decline further today. The Dow Jones Industrial Average lost 1.25%, while the broader S&P 500 index tumbled 1.3% and the technology heavy NASDAQ composite slid 0.7%.
Asian markets were in selling mode today. Hong Kong’s Hang Seng slipped 2.4%, China’s Shanghai Composite Index lost 1.8%, South Korea’s KOSPI tumbled 2.8%, Australia’s S&P/ASX 200 declined 3%, as did Japan’s benchmark Nikkei 225 index.
Commodities
Oil prices declined as July Brent Crude moved down to US$69.58/barrel, while US light, sweet crude for July delivery slid to US$68.59/barrel.
Precious metals also moved south with gold and silver declining to US$1,188/oz and US$17.65/oz, while platinum slipped to US$1,492/oz.
Base metals followed. Copper and nickel were down to US$3.06/lb and US$9.68/lb and zinc retreated to US$0.85/lb.
http://www.proactiveinvestors.co.uk/companies/news/16905/ftse-100-to-slip-below-5000-as-korean-tensions-rise-european-debt-fears-persist-16905.html
The UK’s blue chip index is seen 2.3% lower after tacking on 0.1% yesterday.
Insurer Prudential (LSE: PRU) and beverage group SABMiller (LSE: SAB) led the blue chips, advancing 2.5%. Consumer goods company Reckitt Benckiser (LSE: RB), chipmaker ARM Holdings (LSE: ARM) and Imperial Tobacco Group (LSE: IMT) followed, adding slightly more than 2%. Miner Anglo American (LSE: AAL) and retailer Marks & Spencer (LSE: MKS) climbed 2%.
BP (LSE: BP) was at the bottom of the pile, shedding nearly 3% after the US government threatened to remove the oil and gas supermajor from the ongoing clean-up operation in the Gulf of Mexico after it missed a series of deadlines and appeared unable to contain the oil spill. Outsourcing group Capita (LSE: CPI), oil and gas company Cairn Energy (LSE: CNE) and engineering firm Invensys (LSE: ISYS) lost more than 2%. Another oil and gas supermajor Shell (LSE: RDSB) declined 1.8% and asset management firm Schroders (LSE: SDR) lost 1.4%.
US stocks closed with big losses on Monday and are set to decline further today. The Dow Jones Industrial Average lost 1.25%, while the broader S&P 500 index tumbled 1.3% and the technology heavy NASDAQ composite slid 0.7%.
Asian markets were in selling mode today. Hong Kong’s Hang Seng slipped 2.4%, China’s Shanghai Composite Index lost 1.8%, South Korea’s KOSPI tumbled 2.8%, Australia’s S&P/ASX 200 declined 3%, as did Japan’s benchmark Nikkei 225 index.
Commodities
Oil prices declined as July Brent Crude moved down to US$69.58/barrel, while US light, sweet crude for July delivery slid to US$68.59/barrel.
Precious metals also moved south with gold and silver declining to US$1,188/oz and US$17.65/oz, while platinum slipped to US$1,492/oz.
Base metals followed. Copper and nickel were down to US$3.06/lb and US$9.68/lb and zinc retreated to US$0.85/lb.
http://www.proactiveinvestors.co.uk/companies/news/16905/ftse-100-to-slip-below-5000-as-korean-tensions-rise-european-debt-fears-persist-16905.html
Saturday 15 May 2010
Monday 10 May 2010
Ariana Resources MD and CFO buy more shares in company
Ariana Resources PLC (AIM:AAU) the gold exploration and development company focused on Turkey, said managing director Dr Kerim Sener on May 7 bought 236,857 ordinary shares at 2.30 pence each and on the same day, CFO William Payne bought 100,000 shares at 2.35p each.
Following this acquisition, Dr Sener and related parties will hold 4,250,000 ordinary shares, representing a holding in the company of 1.92 percent.
Ariana Resources told investors last week that 2009 was a year of change and new challenges. In its full-year results statement, the company said that its two flagship projects, Kiziltepe and Tavşan - which were recently combined to form the ‘Red Rabbit’ project - continue to build momentum.
“[2009] was marked by the production of our first gold; this positive outcome accelerated our progress and enhanced our vision for the economic development of the Red Rabbit project”. Ariana Chairman Michael Spriggs commented.
“We are now working to conclude a joint venture agreement on Red Rabbit which aims to fast-track the project through to production ... We have laid out a clear strategy for the future growth of the company and are currently pursuing several new initiatives that aim to create long term value for shareholders.”
Ariana has been working alongside Procea, a Turkish turn-key construction firm, to finalise their proposed Red Rabbit joint venture. In October 2009, the companies agreed the terms of the 50-50 joint venture, whereby it is envisaged that Procea will earn into Ariana’s Red Rabbit project to develop a long term gold mining operation in Turkey.
In the current financial year the development of the Red Rabbit project has accelerated. In March, the company announced results from a geophysical programme which located several anomalies and defined significant exploration upside on the Kiziltepe area of Red Rabbit. Subsequently, Ariana has been gearing up for a fresh drilling campaign on the Kiziltepe gold prospect.
Last month, Ariana raised £1 million through a placing of 50 million new shares at 2p each to certain institutional investors. Most recently, on the 19 April 2010, Ariana said it was working hard to ensure the proposed joint venture starts up in May.
http://www.proactiveinvestors.co.uk/companies/news/16429/ariana-resources-md-and-cfo-buy-more-shares-in-company-16429.html
Following this acquisition, Dr Sener and related parties will hold 4,250,000 ordinary shares, representing a holding in the company of 1.92 percent.
Ariana Resources told investors last week that 2009 was a year of change and new challenges. In its full-year results statement, the company said that its two flagship projects, Kiziltepe and Tavşan - which were recently combined to form the ‘Red Rabbit’ project - continue to build momentum.
“[2009] was marked by the production of our first gold; this positive outcome accelerated our progress and enhanced our vision for the economic development of the Red Rabbit project”. Ariana Chairman Michael Spriggs commented.
“We are now working to conclude a joint venture agreement on Red Rabbit which aims to fast-track the project through to production ... We have laid out a clear strategy for the future growth of the company and are currently pursuing several new initiatives that aim to create long term value for shareholders.”
Ariana has been working alongside Procea, a Turkish turn-key construction firm, to finalise their proposed Red Rabbit joint venture. In October 2009, the companies agreed the terms of the 50-50 joint venture, whereby it is envisaged that Procea will earn into Ariana’s Red Rabbit project to develop a long term gold mining operation in Turkey.
In the current financial year the development of the Red Rabbit project has accelerated. In March, the company announced results from a geophysical programme which located several anomalies and defined significant exploration upside on the Kiziltepe area of Red Rabbit. Subsequently, Ariana has been gearing up for a fresh drilling campaign on the Kiziltepe gold prospect.
Last month, Ariana raised £1 million through a placing of 50 million new shares at 2p each to certain institutional investors. Most recently, on the 19 April 2010, Ariana said it was working hard to ensure the proposed joint venture starts up in May.
http://www.proactiveinvestors.co.uk/companies/news/16429/ariana-resources-md-and-cfo-buy-more-shares-in-company-16429.html
African Medical Investments opens new boutique hospital on Maputo, Mozambique
African Medical Investments (AIM: AMEI) said it has opened its new 30 bed private boutique hospital, trauma centre & Well Woman Clinic in Maputo, Mozambique, replicating its successful first boutique hospital, Trauma Centre & Well Woman Clinic in Dar es Salaam, Tanzania, which opened in March 2009.
The opening of this facility is in line with the group’s strategy to rapidly accelerate the roll-out of private boutique hospitals, Trauma Centres, Well Woman and Well Man Clinics across Africa to meet soaring demand for dedicated private medical services.
The group chose Maputo as a suitable location in which to extend its offering due to its large expatriate community and the low number of health facilities currently in the city. The facility has 30 beds including three ICU beds and two neonatal ICU incubators. Additional facilities include a full emergency department, a major and minor operating theatre, delivery rooms, a radiology department with CT scanner, digital X-ray and 4D ultrasound machines, occupational health services, a vaccination centre and a dedicated pharmacy.
The new facility complements African Medical's current healthcare portfolio which includes the Dar es Salaam hospital, the Trauma Centre in Harare and Airport Medical and Vaccination Centres in Johannesburg and Cape Town International Airports.
The company is also extending its current facility in Harare to include a full boutique 20 bed hospital and refurbishment work is also underway to establish a Well Woman and Well Man Clinic in Nairobi, Kenya. It is expected that all these facilities will be fully operational by the end of June 2010.
African Medical CEO Vivek Solanki said: “By the end of June, with three hospitals and three clinics operational, we will have a solid foundation from which to make strong expansionary progress.”
At the end of April African Medical completed the drawdown of funds under its equity line agreement with a fund managed by New York based Harbinger Capital Partners LLC, and the £2.995 million raised will be used to further advance the company's growth strategy.
The new funds completed the drawdown under the US$47 million equity line agreed with Harbinger in October 2009. In the latest transactions, The New York firm will subscribe to shares representing 6.05% of the enlarged capital of African Medical. This will consist of 6.5 million shares at 23 pence and 6 million shares at 25 pence and will up Harbinger’s interest in African Medical to 41.89%.
African Medical will use the proceeds to fund its expansion plans. It aims to be managing a total of ten healthcare facilities by 2012.
The group is also evaluating additional sites including Kampala, Uganda, where the company has recently sponsored a medical investment conference, which was attended by the First Lady of Uganda, the President of Kenya, regional health ministers and some 800 doctors. It is also evaluating opportunities Accra, Addis Ababa and Kigali.
African Medical is the parent company of VIP Healthcare Solutions Ltd which provides healthcare in niche areas, particularly to the expanding African middle classes and the expatriate, non-governmental organisations, diplomatic and tourist markets.
http://www.proactiveinvestors.co.uk/companies/news/16428/african-medical-investments-opens-new-boutique-hospital-on-maputo-mozambique-16428.html
The opening of this facility is in line with the group’s strategy to rapidly accelerate the roll-out of private boutique hospitals, Trauma Centres, Well Woman and Well Man Clinics across Africa to meet soaring demand for dedicated private medical services.
The group chose Maputo as a suitable location in which to extend its offering due to its large expatriate community and the low number of health facilities currently in the city. The facility has 30 beds including three ICU beds and two neonatal ICU incubators. Additional facilities include a full emergency department, a major and minor operating theatre, delivery rooms, a radiology department with CT scanner, digital X-ray and 4D ultrasound machines, occupational health services, a vaccination centre and a dedicated pharmacy.
The new facility complements African Medical's current healthcare portfolio which includes the Dar es Salaam hospital, the Trauma Centre in Harare and Airport Medical and Vaccination Centres in Johannesburg and Cape Town International Airports.
The company is also extending its current facility in Harare to include a full boutique 20 bed hospital and refurbishment work is also underway to establish a Well Woman and Well Man Clinic in Nairobi, Kenya. It is expected that all these facilities will be fully operational by the end of June 2010.
African Medical CEO Vivek Solanki said: “By the end of June, with three hospitals and three clinics operational, we will have a solid foundation from which to make strong expansionary progress.”
At the end of April African Medical completed the drawdown of funds under its equity line agreement with a fund managed by New York based Harbinger Capital Partners LLC, and the £2.995 million raised will be used to further advance the company's growth strategy.
The new funds completed the drawdown under the US$47 million equity line agreed with Harbinger in October 2009. In the latest transactions, The New York firm will subscribe to shares representing 6.05% of the enlarged capital of African Medical. This will consist of 6.5 million shares at 23 pence and 6 million shares at 25 pence and will up Harbinger’s interest in African Medical to 41.89%.
African Medical will use the proceeds to fund its expansion plans. It aims to be managing a total of ten healthcare facilities by 2012.
The group is also evaluating additional sites including Kampala, Uganda, where the company has recently sponsored a medical investment conference, which was attended by the First Lady of Uganda, the President of Kenya, regional health ministers and some 800 doctors. It is also evaluating opportunities Accra, Addis Ababa and Kigali.
African Medical is the parent company of VIP Healthcare Solutions Ltd which provides healthcare in niche areas, particularly to the expanding African middle classes and the expatriate, non-governmental organisations, diplomatic and tourist markets.
http://www.proactiveinvestors.co.uk/companies/news/16428/african-medical-investments-opens-new-boutique-hospital-on-maputo-mozambique-16428.html
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