RIU Sydney Resources Round-up Day Two

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Catalpa Resources managing director Bruce McFadzean stood before the assembled delegates at the RIU Sydney Resources Round-up on the back of a market release that announced recent report exploration assay results the company has recently received from the Cracow Gold Operations in Queensland.

The recent activity has been targeting high grade epithermal gold mineralisation south of the western Cracow Goldfield with a focus to support the current resource upgrade at Tipperary and Kilkenny together with exploration on a number of other prospects.

A total of 56 underground holes were drilled at Tipperary and Kilkenny for 8,434 metres resulting in high grade intersections including 6.1m at 8.8g/t gold and 8.0m at 13.5g/t gold.

Catalpa is continuing drilling in order to validate the Kilkenny and Tipperary shoots and to also extend the vertical extent of the Tipperary Shoot.

The company expects the results to support a material increase in confidence to the Tipperary Mineral Resource, which is likely to be upgraded to the Indicated category enabling conversion to Ore Reserve.

At 31st December 2010, Tipperary contained an Inferred Mineral Resource estimate of 101,000 ounces.

Also presenting today was Meridian Minerals managing director Jeremy Read, managing director of Meridian Metals, which announced to the market yesterday it had extended the period of exclusivity for due diligence to be completed on the potential acquisition of a 75% interest in Russian Gold Company, Omchak, has been extended by a further two months.

Meridian announced in February that it had entered into a non-binding Heads of Agreement to acquire a 75% interest in the non-alluvial assets of Russian gold company ZAO ZRK Omchak from UK listed Petropavlovsk PLC.

Meridian and Petropavlovsk have now agreed to extend the exclusivity period from 11 May 2011 until 11 July 2011.

Meridian said this two month extension has been necessary to allow it to complete its due diligence on Omchak and its assets.

Under the HoA, Meridian and Petropavlovsk have agreed to an exclusivity period which now ends on 11 July 2011 during which Meridian intends to:
– Complete the due diligence to its absolute satisfaction;
– Advise Petropavlovsk if Meridian will proceed with the purchase of the 75% interest in the non-alluvial assets of Omchak;
– Negotiate and enter into a sale and purchase agreement reflecting the terms and conditions of the acquisition as agreed in principle in the HoA and such other terms as customary for this type of transaction;
– Conclude a shareholders’ agreement to record the terms and conditions for the development of the Omchak assets.

 

Sheffield Resources rock chips return high grade iron

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Bulk minerals explorer Sheffield Resources has announced high grade iron results from rock chip sampling on its tenements located in the eastern Pilbara region of Western Australia.

Initial helicopter-supported reconnaissance took 40 samples, which outlined new zones of iron enrichment on three of Sheffield’s four recently granted iron ore tenements in the region.

The most significant results are from the Three Pools project located 22km north of Newman, where five substantial areas of high grade iron mineralisation have been outlined.

A total of 25 samples from the project averaged 63.0% iron with low to moderate levels of impurities.

Profiles of the iron enrichment in outcrop show evidence of mineralisation extending to depth.

The iron mineralisation at Three Pools is associated with both the Boolgeeda Iron Formation and a banded iron formation within the Wongarra Volcanics.

The Boolgeeda Iron Formation is known to host several significant iron deposits in the Pilbara, including FMG’s Horatio deposit and Atlas Iron’s Hickman and McCamey’s North discoveries.

Sheffield Resources managing director Bruce McQuitty said the results at Three Pools demonstrate the company’s ability to identify new iron ore targets from greenfields projects.

“Sheffield’s experienced exploration team have outlined five significant zones of mineralisation at Three Pools within just three months of the granting of the tenements,” he said.

“We plan to prove up these targets fairly quickly and to consolidate further iron projects with the aim of attaining sufficient size and scale to unlock an infrastructure solution in the region.”

Detailed mapping and sampling will be undertaken at Three Pools during the latter half of Q2 2011 ahead of drilling planned for Q3.

Other results from the reconnaissance work include:

The identification of Channel Iron Deposit (CID) and minor bedded iron enrichment on the Eagle Pool tenement located 4km west of the Three Pools project, and

The outlining of a zone of iron mineralisation with a strike length of approximately 500m to 600m with a thickness of between 20m and 40m at Sheffield’s Panorama project located near Atlas Iron’s Abydos mining centre. Seven rock chip samples from this zone averaged 59.8% iron, although phosphorous levels were elevated.

Ampella scores positive drill results at Konkera

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Ampella Mining has announced the hit of multiple wide high-grade zones of gold mineralisation during infill drilling at the Konkera 2.2 million ounce gold JORC Code Compliant Resource on its 100% owned Batie West Project in Burkina Faso, West Africa.

Konkera has an Indicated Resource of 22.5 Mt at 1.6 grams per tonne gold for 1,182,600 ounces gold and an Inferred Resource of 19.9 Mt at 1.6 g/t gold for 1,041,500 ounces gold.

The latest gold assays stem primarily from extensions to drill-holes targeting projected continuations to gold mineralisation associated with the Konkera Resource at Konkera Main, Konkera East and Konkera North.

From Konkera Main, Ampella received gold assays for an additional 16 drill-holes for a total of 3,384m of drilling. 

Multiple zones of higher grade gold mineralisation were intersected in a number of holes and included:
20m at 4.5 g/t gold and 9m at 3.0 g/t gold from 144m
41m at 3.0 g/t gold and 19m at 2.2 g/t gold from 114m
15m at 3.9 g/t gold and 12m at 3.1 g/t gold from 128m
11m at 2.9 g/t gold and 7m at 3.5 g/t gold from 116m

Ampella is close to completing a further 10 drill-holes at Konkera Main with the aim to extend the Resource to depth.

At Konkera East, assay results were returned for 5 additional infill drill-holes for a total of 884m of drilling. Again, multiple zones of gold mineralisation were intersected in a number of holes and included:
4m at 6.0 g/t gold and 6m at 4.8 g/t gold from 189m (KERD029)
6m at 2.6 g/t gold and 4m at 2.6 g/t gold from 15m (KMRD029)
10m at 2.9 g/t gold from 173m (KNRD073)

At Konkera North, gold assays were received for 5 additional re-entry drill-holes for a total of 282m of drilling.  The best drill-hole extension consisted of:
33m at 1.6 g/t gold from 112m (KNRD118)

Ampella remains confident the deep drilling program currently underway at Konkera North has the potential to add additional resource ounces to the Konkera Gold Resource.

To date, a total of 14 holes have been completed out of 17 planned holes. 

 

Maximus Share Purchase Plan raises $707,500

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The recently closed non-renounceable share purchase plan of South Australian gold play Maximus Resources, which closed on Wednesday 4th May 2011, raised a total of $707,500 before costs.

This represents approximately 41.6 million new shares to be issued to the 112 participating shareholders.

Proceeds from the SPP will be used principally to fund completion of the detailed review of the
Narndee suite of gold and base metals tenements, located in the gold producing, Mount Magnet region of Western Australia.

The funds will enable Maximus to commence field exploration programs on recently identified targets on Narndee, as well as providing the company general working capital.

The SPP offered a maximum take‐up of 90,129,311 shares for a total of $1.5 million.

“Notification to shareholders will commence on Wednesday 11th May and new shares quoted on the
ASX effective Thursday 12th May 2011,” Maximus said in an announcement.

“New shares issued through subscriptions via the SPP are ordinary fully paid shares and will rank equally with existing Maximus ordinary shares.”

The Board of Directors of Maximus said the result was pleasing, given the current turmoil in the investment market and remains enthusiastic about the significant upside potential at Narndee following the recent interrogation of the TEM survey and ground gravity data.

Royalco Resources looks at East African projects

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Melbourne-based Royalco Resources has executed Memoranda of Understanding (MoU) with two, geotechnically qualified Ethiopian entities, over two separate project areas approximately 450 kilometres north of the capital city of Addis Ababa.

The MoUs signal the company’s initial foray into acquiring gold and base metal exploration leases within Ethiopia.

The company has flagged these to potentially be the first of what could be a number of East African transactions.

The first of the MoUs signed is for an Exploration Licence covering what is known as the Sarkaysa project, which the company said is, “highly prospective for gold and base metals”.

Royalco can earn a 60% interest in the tenement for the expenditure of US$1 million.

Initial exploration at Sarkaysa will entail soil sampling and geophysical interpretation to be completed over coming months with a view to drilling identified targets by the last quarter this year.

The second MoU, signed with a separate local Ethiopian entity, encompasses the Kilaj project, located in the same region as Sarkaysa.

Targets include both precious and base metals with Royalco earning an 80 % interest in the project area for an expenditure of US$750,000.

Proposed exploration activities at Kilaj will again encompass soil sampling and geophysics.

“Ethiopia has recently enacted mining legislation, including fiscal obligations, considered to be globally competitive,” Royalco said in an announcement.

“Other mining groups active in the country include BHP Billiton (potash), AngloGold (precious metals), Nyota (precious metals), as well as a handful of Canadian and UK junior exploration groups focussing on either potash or precious metals.”
Royalco’s expects it exploration to involve a blend of advanced and grass roots prospects where access is straight forward with selected targets offering a higher risk-higher reward outcome in a short time frame.

Both the Sarkaysa and Kilaj projects fall into the grass roots category.

Royalco is currently in negotiations regarding additional projects in Ethiopia as well as in countries nearby.

 

Toro and Deep Yellow drill Namibia

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Nova Energy Namibia, which is owned by a consortium including Deep Yellow, Toro Energy and Sixzone Investments, is to commence a drilling program of approximately 10,000m RC drilling on its tenements in Namibia.

 Deep Yellow, operating through Reptile Uranium Namibia, will manage the program, which has been designed, subject to strict environmental and rehabilitation conditions, to test the “Alaskite-style” uranium potential of EPL 3669.

According to a Toro Energy release, “The drilling will evaluate the western strike extension of uranium mineralisation recently reported by Extract Resources at the Pizarro prospect (8m metres @ 638 ppm U3O) along with other targets related to low magnetic responses contained within a stratigraphic and structural corridor.”

“Holes will be drilled to a nominal 150m depth. All holes will be gamma probed and anomalous zones will be assayed.”

 

RIU Sydney Resources Round-up – Day One

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The 2011 RIU Sydney Resources Round-up kicked off this morning to news that Wayne Swan had left the mining industry out of the Federal Budget.

That came as a bit of an anti-climax, especially for us journalistic types who enjoy a good government versus mining industry stoush.

It would appear the Gillard government has done its utmost to avoid any confrontation with the miners leaving that particular battle to be picked up by the Greens.

Greens leader Bob Brown was fairly succinct in his description of the budget saying it was “lacklustre”, giving a clear indication his party will be expecting a few changes to be made to the budget make-up.

“It’s got some high notes and low notes, but the music’s not there,” he told ABC TV.

“This is a wealthy country, we have the best resources base in the world, there is a mining boom and all we’re hearing from the big parties is cuts.”

Brown however, didn’t go into any great detail about any of the changes the greens may want to make, saying he wanted to take the time to see how the budget was configured and set in legislation.

“We have always said we’re going to ensure supply,” he said.

“On the other hand it is our job to improve and if we can improve this budget for a better outcome for Australians we’ll certainly be looking at that.”

Meanwhile at the Resources Round-up delegates were treated to a key note address on what the immediate future may hold for the base metals market by BNP Paribus senior metals strategist, commodity markets strategy Stephen Briggs.

“Increasingly metal prices, base metal prices in particular, will have to flourish on their own fundamentals more than on wider economic conditions,” Briggs said.

Briggs said base metals have become almost a mainstream asset class in the last couple of years.

Not only as an avenue to buy into futures markets, but there has been any number of other paths for investors that have been supportive of this trend.

“These metal markets also become ever more forward looking,” Briggs said.

“But I would warn you that this forward looking aspect of the market is not symmetric.

“All financial markets, but particularly base metal markets, are very good at pricing in future bullish developments.

“They are truly lousy at anticipating bearish developments.”

On the company front junior Pilbara iron ore producer BC Iron announced that it had terminated its proposed Scheme of Arrangement with Regent Pacific Group.

The company said in an announcement to the market that it “wishes to advise that its independent expert, KPMG, has concluded that Regent Pacific Group Limited’s (Regent Pacific) proposed Scheme of Arrangement (Scheme) is not fair and not reasonable and therefore, is not in the best interests of shareholders.”

The termination brings to an end the protracted take-over bid from Regent.

 “After careful consideration and taking into account the conclusions of the Independent Expert and Senior Counsel, the BC Iron Board has determined that the withdrawal of its recommendation for, and termination of, the Scheme of Arrangement is in the best interests of our shareholders,” BC Iron chairman Tony Kiernan said.

“This decision largely reflects the positive changes in your company’s value since announcing the Scheme.

“Looking forward, the Board and management are excited at the opportunities to grow BC Iron for the benefit of all shareholders.
 
“Our status as Australia’s latest iron ore producer at a time of very strong iron ore prices makes the Company extremely well placed to consider future strategic opportunities.”

 

Quarterly figures reflect WA’s push to improve approvals system

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The use of new technology has been identified by the Western Australian state government as a major contributor to the significant turnaround in approvals for the first quarter of 2011.

The WA government has been eager to improve its mining approvals processes to meet the growth of applications, especially those in the on-line category.

On-line applications have jumped from 10 per cent to 26 per cent in the month following the recent launch of a new electronic lodgement system.

“The ability to lodge programs of work (POW) and mining proposals online was made available in August 2010,” Western Australian minister for Mines and Petroleum Norman Moore said.

“By March 2011 there were more POW’s lodged online than paper lodgements. Although industry exploration activity increased in the first quarter of 2011, reforms were implemented and consequently, flexibility and timeliness improved.

“Online submissions require a defined quality standard and higher quality submissions result in significantly less approval timelines.

“WA resources industry activity occurs mostly in regional and remote areas – so making lodgement processes more accessible to those areas has obviously made a big difference to mining companies.”

The latest government data shows tenement applications jumped from seven per cent to 26 per cent using online lodgement.

In the first quarter of 2011, 92 per cent of the 570 exploration licences lodged were finalised within the timeline target and 96 per cent of programs of work were finalised within 30 business days.

Of the 72 petroleum environmental plans, 96 per cent were finalised within the timeline target while 75 per cent of petroleum wells were finalised within 40 business days.

“Information can now be streamed to computers and hand-held devices such as phones and it is interesting to note that 22 per cent of all electronic lodgements were outside core business times,” Moore said.

Wolf Minerals provides market with tungsten update

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Australian specialist minerals exploration and development company Wolf Minerals released some interesting information to the market.

The company released an update on the tungsten market, which highlights a strong outlook for future price and demand and, unsurprisingly paints a rosy picture for its flagship project.

Wolf’s core project is the Hemerdon Tungsten and Tin project in Devon, in the UK, where Wolf is close to finalising its Definitive Feasibility Study.

The Hemerdon Project is 100% owned by Wolf Minerals and is claimed by the company to be one of the largest undeveloped tungsten and tin resources in the western world.

It lies 10 kilometres north east of the port of Plymouth in the south west of the UK with a history of mining and established infrastructure.

Wolf is proposing to develop Hemerdon by low cost open pit mining.

Tungsten Market highlights
• Outside of China, the tungsten price is represented by the price of Ammonium Para Tungstate (APT). The APT price is published in Metal pages and Metals Bulletin.

• APT is rising with increasing global demand and limited supply from China.

• Tungsten product prices are quoted in metric tonne units (mtu), where 1 mtu = 10kg (so $400/mtu equates to $40,000/tone).

• Price
    o APT prices are currently trading between US$420 and US$430 (Metal pages Ltd. 3 May 2011).
    o Prices for APT are forecast to increase to an average of US$475 per mtu in 2012.

• Demand
    o Tungsten demand correlates closely with economic output – tungsten demand in one year reflects growth in GDP the previous year.
    o Global tungsten demand forecast to increase at an annual growth rate of 6-7% – from 70,051tonnes of tungstic oxide (W03) in 2010 to 111,602 tonnes of W03 in 2015.

• China Impact
    o China is largest user of tungsten and accounted for 62% of world consumption in 2009
    o Chinese demand expected to grow by 7% per year

• Tungsten Use
    o Largest end-use is in manufacture of hardmetals (cemented carbides) which accounted for approx 54% of global consumption in 2009
    o This is followed by steels/alloying sector – approx 27% of global consumption
    o Mill products (13%) and other applications (6%) make up remainder of end-use

 

RIU Sydney Resources Round-up

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The eighth annual RIU Sydney Resources Round-up kicks off at in the salubrious surroundings of the Sofitel Sydney Wentworth this week with the three day conference promising to provide investors with the opportunity to meet the people behind some of Australia’s leading exploration and mid-tier mining companies.

The Resources Roadhouse has driven the company ute across the Nullarbor to be at this event in order to press some serious mining industry flesh as well as providing its readers with up-to-date daily commentary from the conference.

The RIU Sydney Resources Round-up has earned a reputation as the principal East-Coast Australian forum for the small to mid-cap resources sector.
This year more than 65 companies will be represented at the convention running from Wednesday 11 to Friday -13 May.

As well as being in the best place to hear the latest commodity market updates, visitors to this year’s round-up will also gain a close-up look at some of the external factors currently affecting Australia’s exploration and mining sectors.

These include such facets as the state of the global economy, the impact the economic meltdown has had on the different countries around the world as well as the expected introduction of a national mineral resources rent tax.

“Savvy investors are picking up some real bargains in buying companies with a solid business strategy, experienced management team, and near term production – particularly in the iron ore, coal and uranium sectors.” Stewart McDonald, managing director of event organisers, Vertical Events said.

Some of the key presentations at this year’s conference include: Chris Reed of Reed Resources, Chris Bonwick of Independence Group, Steve Parsons of Gryphon Minerals, and Mike Young of BC Iron.