Fox-Davies Capital Thursday Energy and Mining News Wrap

Petrofac (PFC) was awarded a contract to undertake the engineering, procurement and construction of the Kauther gas field compression plant in Oman, together with the commissioning and six months of initial operation. The contract, worth more than US$350m, was awarded by Petroleum Development Oman.

Discovery Metals (DME) announced the successful delineation of ground- water resources which are more than sufficient to meet the processing and other operational needs of its 100% owned Boseto Copper Project. The groundwater resources were defined after an extensive program which included the drilling of eleven water exploration boreholes. The water resources planned for use at Boseto are contained within two of the five potential groundwater resource areas identified during the water exploration program undertaken as part of the Bankable Feasibility Study on the Boseto Copper Project. Borefields which will tap these resources will be situated within 15 km of the proposed plant site.

These two sources of ground water, "GRA 5", and "GRA 1" are together capable of sustaining pumped flowrates of approximately 12,000 megalitres of water per annum over a15 year time frame. With the water requirement for the current base case for the Boseto Copper Project (10 year project at 2Mtpa processing rate) estimated at 2,500 megalitres of water per annum, these two areas alone have the capacity to deliver more than four times the annual water requirement of the Boseto Copper project for five years longer than the currently.

Comment: This is extremely positive news for Discovery. With no shortage of mineral resources, we believe it opens the door for an increase in mill capacity which would bring economies of scale.

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