world's best undeveloped ni sulphide project, page-2

I can’t believe I missed this nickel play for so long.

I have been watching recent movement in Drake Resources (DRK) and Rox Resources (RXL), however compared to IMX Resources they are much riskier plays and far less advanced.

IMX already has a substantial JORC nickel resource of 289,700t (to be upgraded during Q1 2013):
MEASURED - 1.66Mt at 1.71% Ni and 0.29% Cu (28,400t of contained nickel)
INDICATED - 11.12Mt at 1.14% Ni and 0.25% Cu (126,300t of contained nickel)
INFERRED – 45.04Mt at 0.3% Ni and 0.07% Cu (135,000t of contained nickel)

26 holes for a total of 7891m of drilling were reported on 20/12/12, all containing nickel:
- 1314m of drilling reported >0.3% Ni (that is a total of 17% of metres drilled)
- 178m of reported intercepts were >1% Ni.
- 12m of reported intercepts were >3% Ni.
- 1.25m is a massive sulphide at 16.3% nickel. Now that is HIGH GRADE.

These results are quite incredible and should be getting similar or better recognition than Drake and Rox. IMX’s share price has only climbed 41% since this significant announcement. In fact, it appears to have been missed due to other discoveries by Rox Resources and Drake Resources.

Also on 20/12/12, Drake (DRK) reported an intercept of 200m of disseminated nickel, however its grade is unknown (likely to be less than 1%). Its share price is over a 3 bagger since discovery. IMX has recently reported 1314m of nickel and copper sulphides across 26 holes, averaging 50m of intercepts containing nickel per hole. Hole NAD12302 contained 101m of disseminated nickel (0.40%) and copper (0.09%) sulphides.

Rox (RXL) has reported 19m of higher grade nickel (6m semi-massive, 13 metres strongly disseminated). Its share price is around a 4 bagger since discovery. As can be seen from above, 178m of intercepts from IMX’s latest release contained grades of >1% Ni, 12m being >3% Ni. IMX also has reported copper, unlike Rox.

Contrary to Drake and Rox, IMX is unlikely to require a capital raising in the foreseeable future mainly due to:
- Cash of $19.2m at 30 Sep 12. IMX is well funded for drilling its Ntaka Hill Nickel prospect in Tanzania, however it has spent around $20m since June 2012 on exploration and project evaluation in Tanzania and Australia.
- IMX has received $3.7m following a recent capital raising (21/11/12) and will receive a further $5m from its divestment of the Mt Woods Copper Gold JV to Oz Minerals.
- IMX owns 51% of the Cairn Hill Mining Operation (based in Coober Pedy) that is cash flow positive (at least $4m this period), producing premium coarse grade magnetite-copper-gold DSO product at a rate of 1.8Mt p.a. Operating costs are declining resulting in improved cash flow. It is producing in excess of $200m revenue p.a.
- IMX also owns 25.65% of Uranex (UNX). With its market capitalisation at around $15m, IMX has an investment worth around $4m

With many other prospects not listed and with rising volumes today, I believe IMX has great immediate potential. Remember its market capitalisation is only at $61.4m with around 396m shares on issue. IMX has found substantial nickel resources (further drilling results are pending) and is generating cash flow from its iron ore operation.

GLTA holders. Please DYOR.