sha will be a major gold and nickel success in 200, page-5

re: shannon on the up in stealth mode macrae An insight into what we may possibly be looking at in the future with Shannon, and indeed the midas touch of CEO Frank Carr. Very good article, and I'm glad to be on board. As follows:

Dinkum explorer or amateur treasure hunter?
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Thursday, 7 December 2006

IT'S awfully hard to be sitting on a resource of 2.25 million ounces of gold and maintain a profile so low that hardly anyone in the gold industry knows who, or what, you are. Report by Tim Treadgold

It's even harder when the gold in question is at a location called Lindsays, just 60km northeast of Kalgoorlie, and within site of the Kanowna Belle and Carosue gold mines.

But whether by carefully planning or by being a complete novice in the mining world, Carrick Gold has managed to achieve the near-impossible: found lots of gold and been completely ignored at the same time.

For long-time observers of the mining world, a profile so low is both an attraction and a worry.

It attracts because Carrick has the whiff of "hidden gem" about it.

It repels because it has an equally strong whiff of "amateur treasure hunter" about it.

Next year will be the test for Carrick as it starts to lift its profile by talking to financial markets and the financial media, and by moving with a pre-feasibility study aimed at proving that a mine can be established – or that the company and its gold can be sold for a fat profit.

It is this second layer of uncertainty about Carrick – is it a dinkum explorer/miner or a bold financial punt – that adds to the ambiguity.

Frank Carr, the man who created Carrick (and effectively gave the company his Irish name: carrick is Gaelic for stone) says he is confident that early scoping studies will lead to the creation of mine at Lindsays, one of many historic mining centres along the Yarri Road that passes Kanowna Belle and other mines.

"The plan is to drill as quickly as we can to boost the resource to 5Moz and convert as much as we can to reserves," Carr said during a site visit.

"The fact that we've got 2.25Moz already is highly encouraging but we want to lift that to 5 million over the next year, or so."

With so much gold in his back pocket and with more certain to come given the easily-understood nature of the geology at Lindsays and other nearby targets, it is surprising that so few people in Kalgoorlie have heard of Carrick or Lindsays.

Old-timers might remember a trial pit opened at the site by the AUR group in the mid-1980s, only to see it closed when troubles hit. But apart from that modest attempt at mining, the only other evidence of activity on the site is the hole left by the original diggers from 100 years ago who worked what was then called Lindsays Find.

To understand why there are doubts over whether Carr is a serious miner or a canny corporate player, a little more history is important.

Carr's entry into the mining world came late and started with his purchase in 1994 of the claims covering Lindsays from, in his words, a couple of guys he met at the Windsor Hotel in South Perth.

At the time, the gold price was low, assets were cheap and Carr was looking for a new business interest after a high-flying career in the 1980s as one of the men behind the float (and sale) of the Miniskips rubbish collection system, and the latter years of the Ariadne investment group.

Gold, to Carr, was an optional extra; perhaps something to round out the career of a man who grew up in Dublin and operated a shipyard specialising in fishing trawlers as his first exposure to business.

With a pile of cash from his Miniskips and Ariadne days, Carr personally funded work at Lindsays for the best part of 10 years, going public early last year with the float of Carrick, in which he kept a 56% interest for himself.

The float, one of the most successful of 2005, was another stage in the process of keeping Carrick's profile low. Carr refused to have an underwriter or broker to the issue. He just did it himself, like the Lindsay's drilling.

The result of "doing it his way" ensured that no brokers followed or recommended the stock – a marvellous example of how brokers invariably follow stocks that will generate as much money for them as their clients.

Times, however, are changing. Last month, for the first time, Carr took Carrick on a mini-roadshow to a handful of Sydney and Melbourne brokers – waving 2.25Moz of gold under their noses, and pointing to the 5Moz target.

He says they liked the story, though the company's share price has barely moved since.

What the brokers want to see is how Carrick "joins the dots" from its drilling at targets along three broad lines of mineralisation with the primary target being the Parrot Feathers discovery, which appears to be extending to the north, with grades increasing.

Getting higher grades is important to Lindsays. The current resource is based on 28.4 million tonnes of material averaging 2.5 grams a tonne.

In that form, Lindsays might make ideal feed for a big mill like Paddington, with early studies pointing to the possibility of constructing haul road linking the ore body and the mill – but rejected by Carr as a "deal too early" in the discovery process.

It was the rejection of a fast profit that perhaps says more about Carr's plan than anything else. Having funded work at Lindsays for 12 years and with the gold price up substantially on where he started, and with demand for mill-feed rising, he is sitting pretty.

In time, especially as the Lindsays resource grows, Carr can expect many more calls from mill operators wanting feed, or gold project consolidators, such as Michael Kiernan's Monarch Gold, wanting a project into which they can sink their teeth as operators.

As for Carr being the long-term operator of a processing plant, well that scenario would fit very neatly into a story straight from someone who has kissed the Blarney Stone – which is almost certainly something every true Irish lad has done at some stage.