THE BOURSE WHISPERER: The frustration being caused by delays on assay results felt by companies exploring in West African nations has reached breaking point for Middle Island Resources.
After doing a bit of shopping around for the best equipment available Middle Island has ordered a dedicated, fully equipped, containerised sample preparation laboratory from South Africa.
The company was motivated to purchase its own equipment due to backlog it, and other companies, has been suffering.
Middle island currently has an assay backlog in the SGS laboratory in Ouagadougou totalling 16,596 samples (6,125 drill holes).
The company did say that it was reasonable to anticipate this backlog could be progressively resolved prior to commencement of the 2012-13 field season, providing it with a flow of exploration results from July through to October 2012.
However, despite repeated laboratory assurances and guarantees, Middle Island expressed its frustration at the delays caused by this ongoing issue and the affects it was having on the progression of its exploration efforts during the 2010-11 and 2011-12 field seasons.
Unlike commodity prices and market sentiment, the company identified the issue does lie within its control and that it wasn’t worth taking the risk of the situation recurring in the 2012-13 field season.
“While I am philosophically opposed to investing shareholders funds in acquiring analytical or drilling equipment, this decision represents a compelling and cost-effective solution to a frustrating problem that, if not addressed, risks costing shareholders considerably more in the longer term,” Middle Island Resources managing director Rick Yeates said in the company’s announcement to the Australian Securities Exchange.
The containerised sample preparation laboratory facility will be initially located in Ouagadougou, the capital of Burkina Faso, in order to process samples generated from the company’s Reo project, as well as its Nassilé and Dogona projects, located in neighbouring Niger.
Diagrammatic representation of the containerised sample preparation
laboratory recently ordered by Middle Island Resources. Source: Company
The unit is completely enclosed within a conventional shipping container, which means it can be relocated to the centre of exploration/development activity in any country at any time.
Middle Island is in the process of appointing a recognised independent analytical company to manage the sample preparation facility in order to ensure independence and to avoid distracting exploration personnel.
The facility will provide the flexibility to rapidly process samples to produce 200 gram sample pulps that can then be cost-effectively flown to any internationally accredited laboratory in the world for analysis, significantly reducing current turnaround times.
Any excess capacity in the sample preparation facility will be made available to peer-group companies in order to optimise operating costs, and several companies have already expressed strong interest in participating.