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2001

Sep 2001 - Kingsgate Cons

Kingsgate Consolidated NL (KCN) - On Target for its First Gold Bar in November

  • Kingsgate’s Chatree mine in Thailand is well known and after some time attaining all the regulatory requirements, it is now expected to produce its first gold bar by the end of November 2001, following a construction period of almost one year.
  • KCN shows a very high sensitivity to Chatree’s gold grades. In our opinion, we believe that there are a number of reasons to suggest that gold grades should be at least 10% higher than expected. If such higher grades are achieved, then at current long-term gold prices of US$270/oz and an A$ exchange rate of US$0.50, the 5%real NPV of the project increases from A$0.87 to A$1.43.
  • KCN is in the very fortunate position that it does not pay tax for the first 8 years following its first gold pour, and then has a further 5 years after that at half-tax rates or 15%, under an agreement with the Royal Thai Board of Investment.

Dec 2001 - Elkedra Diamonds

Elkedra Diamonds NL (IPO Raising $3.5m) – Targeting Kimberlite Pipes in the NT using classic diamond formation models – SPECULATIVE BUY at 25c

  • Elkedra Diamonds NL is offering 14m shares at 25c by way of an underwritten IPO. Over-subscriptions of a further 6m shares could increase the total amount raised to $5m.
  • Due to Elkedra’s relationship with its current parent Metex (MEE), MEE shareholders are to receive a preferential offer of the minimum parcel of 10,000 shares each ($2,500). Up to 2m shares are accessible by MEE shareholders.
  • Funds raised through the IPO are to be spent drilling 31 high priority magnetic anomalies that have been identified on Elkedra’s tenements in the Altjawarra Craton in the Northern Territory. Drilling is expected to start by April 2002. These anomalies were identified from a 400m spacing aero-magnetic survey, completed by the NT Dept. of Mines and Energy, and released in March 2000.
  • The recent release of the detailed aero-mag data, (made available free), dramatically altered the economics of undertaking exploration in this potentially very prospective region. Previously, exploration was regarded as extremely difficult for explorers without GPS to know exactly where they were, due to few roads in apparently a virtually featureless landscape. As a result most of the areas have largely been un-tenemented since 1989.
  • Following the release of the aero-mag data and using theoretical models developed over several years by Elkedra’s management, the company pegged some 48,000 km2 of ground focusing on the nucleus of the Altjawarra Craton. Less than 24 hours before Elkedra submitted its applications, De Beers Australia had pegged 4 tenement blocks within the outer boundary of Elkedra’s target area.
  • This region has long been of interest to the diamond “majors,” with RIO and Stockdale (DeBeers) having held exploration licences over the area in the early 1970s to late 1980s. To date, some ten micro-diamonds and 1 macro-diamond have been reported on Elkedra’s leases, as well as numerous diamond indicators such as deep-sourced chromites and several picro-ilmenites. So far, most of the work focused on the fringes of the target area.
  • Recent work by Elkedra has indicated that at least five of the magnetic anomalies have coincident geomorphic crater-like appearances, with one hosting a micro-diamond and others hosting diamond indicator minerals.

Dec 2001 - Independence Gold

Independence Gold NL (IPO Raising $3.5m) – Has significant upside potential from the rights to WMC’s Southstar database – SPECULATIVE BUY at 20c

  • Independence Gold NL (IGO) is offering 17.5m shares at 20c by way of an IPO. Over-subscriptions of a further 2.5m shares could increase the total amount raised to $4m. Within 3 months of successful listing, all shareholders receive 1 option (details to be announced post listing) – for - every 2 shares held.
  • IGO has an associated relationship with Ranger Minerals (RGS) who provided the initial seed capital of just over A$1m for which it received 15m ordinary shares in IGO (which with the 1m contribs is expected to be 28.8% of the total shares issued of 55.6m).
  • IGO has 5 joint ventures covering a suite of metals namely gold, PGE’s and base metals, of which the most advanced are the gold projects. The JVs are Chesterfield, Goldsearch, Randles Find, Southstar, and Dolphin.

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