In the 2009/2010 year 20,000mt will be drilled. SDL said they would be drilling shallower then in the past. Even if they go to 100mts on each hole,that would be 2000 holes to drill. At Nabeba one hole was shown to go from surface to 143mts and still in DSO.This is way deeper then at Mbarga where the average is 40 to 50 mts. SDL are looking to use a lower cut off grade which will increase the high grade Resource.
The Itabirite infrastructure was quoted to cost USD$500 million for stage one to produce 15 million tonnes per annum,with a further USD$500 million to produce 35 million tonnes per annum.
Another couple of things that could generate more cash are gold and Light Rear Earth Elements.Light Rear Earth Elements have been found at Metzimevin. There is going to be a shortage of Rare Earth Elements as Chine who are the largest holders of these elements is looking to cut back on exports to conserve their resources. Even with out China cutting back there is likely to be a shortage in a couple of years anyway.
West Africa gold achieving increasing global significance. A Report from Ambrian,West African Gold Sector.
Ambrian notes that globally,+ 1 Moz gold discoveries have been declining,"Gold production from West Africa has increased by 53% over the last 10 years and the region is generating a number of + 1 Moz gold discoveries.The region produced some 175 t of gold in 2008,which would place it seventh if rated as a single entity against the top producing countries.On this basis,we suggest the region will rank second behind China in the next few years.
Addressing the first day in Perth of the Paydirt 2010 Australian Gold Conference,Convener of the Conference's West African Frontier session,Rick Yeates,said there had been a "massive turnaround "in investor sentiment to what had been more commonly known globally as the African Gold Coast.He said West Africa's resources potential has emerged after a long hiatus among global investors as "the new Africa for Australian fund managers looking to increase their exposure to gold.
The sector has had to go to extraordinary lengths to convince the Australian market that West Africa is a great place to invest - now it is almost Flavour of the Month.
The area around SDL tenements is known to be a big area for artisanal miners for gold.Nabeba has a lot of these miners.This area is largely unexplored for gold as far as bigger miners. Nabeba,Yangadou area was being explored by an Italian Company for gold but pulled out because of some problem to do with water.
Regards Westcott.
SDL Price at posting:
15.0¢ Sentiment: None Disclosure: Held
