Monday, 6 February 2012

Hastings Rare Metals rated as speculative buy

Hastings Rare Metals (ASX: HAS) has been valued as a “speculative buy” by a research house, based on the Hastings Project’s high grade heavy rare earth oxide content.

The report also cited the expertise brought to the company by the October 2011 appointment of Steve Mackowski, a rare earth elements mineral processing engineer with hands on experience in processing.

The following is an excerpt from the report.

Investment Case

- The Company confirms that the Hastings Project resource has a very high grade heavy rare earth oxide (HREO) to total rare earth oxide (TREO) ratio of 85%. The research house considers this to be one of the highest ratios known ROW for a similar style REO resource.

- The current total HREO content of 62,500 tonnes @ 0.18% HREO places the Hastings Project sixth in the Top 10 of comparable REE projects ROW.

- A JORC compliant resource statement (NI43-101 equivalent) currently stands at a total resource (Indicated and Inferred) of 36.2 million tonnes @ 0.21% TREO.

- Rare metals hafnium, gallium, niobium, zirconium and tantalum and heavy rare earths dysprosium, erbium, ytterbium and yttrium were found to be present in significant concentrations.

- As the Top 20 shareholders hold around 68% of the issued capital, HAS is a very tightly held stock. The Top 100 shareholders hold 87%.

- The Hastings Project is currently working towards the pre-feasibility stage and as such, HAS is ahead of comparable sized peers with a HREE resource and I have no doubt that they will become a new supplier of REOs as the project advances.

- Mr Steve Mackowski’s expertise will advance the Company’s projects which the research house considers will elevate the company’s stance among its peers and re-rate the share price and potential return to shareholders.

Company brief

The Company has two projects exploring for rare earths in Western Australia. The 100% owned Hastings Project near Halls Creek in the East Kimberley region of Western Australia extends over 1990 hectares and is a HREE project containing dysprosium and yttrium.

The 60% owned interest in the Yangibana Project in the Gascoyne region of Western Australia north-east of Carnarvon covers approximately 206 km2 and is predominately a LREE project rich in neodymium. The free-carried JV partners are Artemis Resources Ltd (ASX: ARV) with a 10% interest and UK company Rare Metals Ltd with a 30% interest.

Top 10 ASX-listed REE Companies Market Cap A$

- Lynas Corp (LYC) - Mt Weld, WA $2.5B
- Alkane Resources (ALK) – Dubbo, NSW $325M
- Greenland Minerals (GGG) – Kvanefjeld, Greenland $239M
- Arafura (ARU) - Nolans Bore, NT $173M
- Northern Minerals (NTU) - Brown's Range, NT $96M
- Peak Resources (PEK) - Ngualla, Tanzania $90M
- TUC Resources (TUC) - Stromberg, NT $18M
- Kimberley Rare Metals (KRE) - Cummins Range, WA $10M
- Hastings Rare Metals (HAS) - Hastings, WA $8.6M
- Krucible Metals (KRB) - Korella Bore, Mt Isa QLD $8.6M

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