Fox Davies Capital Update featuring ATH Resources, Aurum Mining, Minera IRL, Lamprell, San Leon Energy
Mining News
ATH Resources (LON:ATH) PLC (ATH LN, 33.50p, ▲ 3.08%) announced that it has renegotiated the terms of a second legacy contract. Under the new terms of the contract which are effective from 2 January 2012, there will be an increase in the selling price per tonne in consideration for additional options being granted over future coal supply beyond the end of the current contract. The third and final legacy contract will be fulfilled at the end of March 2012.
Aurum Mining (LON:AUR) PLC (AUR LN, 3.25p, ▲ 4.00%) provided an update on the ongoing drilling campaign on the "El Facho" structure of its Zamora gold project through its Spanish joint venture with Ormonde Mining plc. Best results include 23 m at 1.1 g/t Au, 12 m at 3.4 g/t Au, 3 m at 3.6 g/t Au, and 6 m at 3.7 g/t Au.
Minera IRL (LON:MIRL) Limited (MIRL LN, 71.50p, ► 0.0%) announced the results of a Feasibility Study for the Don Nicolas Project located in Santa Cruz Province, Argentina. The Don Nicolas Project will become Minera IRL's second producing mine with commercial production targeted to commence in Q4 2013. Ore treatment will be at a rate of 350,000 tonnes per annum to produce a steady-state average of 52,400 ounces of gold and 56,000 ounces of silver per year over an initial mine life of 3.6 years. The life-of-mine cash operating cost, after silver credit, is expected to be US$528 per ounce gold. Recoveries of 92.1% of gold and 47.4% of silver are expected. Capital cost is expected to be $55.5 M. Based on a gold price of US$1,250 per ounce, an NPV @ 5% of US$44.7 million (pre-tax) and an IRR of 34.6% (pre-tax) is expected.
Tri-Star Resources PLC (TSTR LN, 0.78p, ▲ 4.70%) provided an update to its drilling programme on its Goynuk Project, Turkey, which has recently been completed. Best results include an intercept of 7.10% Sb over 4.70m and 2.7 m at 2.3% Sb.
Oil and Gas News
San Leon Energy (LON:SLE) (BUY 60p), (SLE LN, 12.25p, ▼ 2.00%). Four potential zones for gas production. The Company is analysing the final technical results of the Siciny-2 well located in the SW Carboniferous Basin of Poland. The Siciny-2 well, 100% held by San Leon and comprising of 880,000 acres was recently completed. The initial goal of collecting core and down hole geophysical data focused on understanding the unconventional gas potential of the Carboniferous section has been achieved. The Carboniferous is known to be the source rock for the significant gas production in the overlying Permian Rotliegendes formation in Poland. Penetrating more than 1,000 metres of Carboniferous section, the stratigraphic test well reached target depth of 3,520 metres, and more than 265 meters of continuous core were collected across three prospective intervals identified in the Siciny-1 well. A previously unseen fourth potential Carboniferous shale section and a fractured tight gas sandstone was also encountered below 3,200 meters in the well. Tight rock analysis will be performed on the core to evaluate the potential for commercial shale gas and tight gas sand production. Valuable drilling data was also obtained in drilling the complex structure of the Carboniferous section, allowing the Company to reduce the time and cost of drilling future wells. Analysis and interpretation of the core and logs is expected to take about three to four months in preparation for future production testing operations. With the flurry of drillbit success, the next six to twelve months should be exciting for San Leon Energy.
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Aurelian (AUL LN, 16.50p, ▼ 1.49%). Will the company bask in the glow of San Leons sunshine? On the 1st of February this year, management have effectively put the company up for sale. At that time Aurelians update pointed towards a significant amount of frustration and disillusionment with the market, with the market valuing their gas portfolio at £30mm. Todays news from San Leon will focus attention on just what the company has in its portfolio, and whether fresh eyes can unlock more value. With cash accounting for a significant proportion of Aurelians share price, and todays announcement from San Leon that there are ways of making Polish shale gas work, Aurelians for sale tag may now start to attract some interest.
Oilfield Services News
Lamprell (LON:LAM) (HOLD), (LAM LN, 329p, ▲ 0.70%) announced yesterday the award by Leighton Offshore Pte Ltd, a Singapore based company, of a contract for the fabrication of two topsides and jackets in connection with the Iraq crude oil export facility reconstruction. The contract value is $62m. The works will be performed at Lamprells Sharjah facility and are due for delivery in Q4 2012.
Saipem (Monitored Coverage): Saipems 2011 results were broadly in line with market expectations with revenues at 12.6Bn, EBITDA at 2.13Bn and adjusted net profit at 921m. The groups outlook statement reads positively for both the industry and the company itself. The groups backlog at 20.4bln is close to record levels.
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Disclaimer:
ATH Resources plc is a holding company. The Company is engaged in the operation of surface coal mines and the subsequent sale of coal to the United Kingdom electricity generators, industrial and domestic customers. The Company operates under the title of ATH Resources. The Company operates in one segment Surface Mining. Throughout the development and operation of its projects, the Company focuses on the restoration and rehabilitation of the sites and land is returned to a range of uses, including agriculture, forestry, nature conservation and other forms of development. In addition to its operating mines, it also has a range of other coal mining projects in Scotland and two through its subsidiary, Societe des Ressources Minieres du Massif Central (SRMMC), including a series of six existing coal concessions in south-central France. The Company’s wholly owned subsidiaries include Aardvark TMC Limited, ATH Garleffan Limited, ATH Regeneration Limited and Northumbrian Power Limited. more »
Aurum Mining Plc is an investment company. The Company has two segments: Corporate and Mining. Corporate segment include the heads office activities of the Company and all non-current assets allocated to corporate activities in the United Kingdom. Mining segment is engaged in the mining, production and exploration of gold and other precious metals and all noncurrent assets allocated to mining activities in the Kyrgyz Republic. As of March 31, 2010, the subsidiaries of the Company included Aurum Mining Kazakhstan LLP, Tryden International Limited and Aurum Mining KG. On December 22, 2009, the Company completed the disposal of Kaldora Company Limited and the Andash Mining Company, which operated in the Kyrgyz Republic. more »
Minera IRL Limited (Minera IRL) together with its subsidiaries is a precious metals mining, development and exploration company. The Company’s 100% owned Corihuarmi Gold Mine (Corihuarmi) is located approximately 160kilometers southeast of Lima, Peru, in the Central Andes at an altitude of almost 5,000 meters. During the financial year ended December 31, 2011, Corihuarmi produced 33,255 ounces of gold. The Ollachea Gold Project is located in southern Peru, approximately 250 kilometers north of Lake Titicaca, on the eastern escarpment of the Andes Mountains. During 2011, it completed over 73,934 meters of diamond drilling in 193 holes. The Don Nicolas Project is based upon an NI43-101 compliant indicated resource of 201,000 ounces plus an Inferred resource of 158,400 ounces of gold. The Project’s most of the resource is located in two deposits, the La Paloma and Martinetas. Its Chapi-Chapi property hosts copper-gold-molybdenum skarn system within Cretaceous limestone. more »
