re: speculator david haselhurst heheheh u were right :) Well...

re: speculator david haselhurst heheheh u were right :) Well done $$$$$$$$

Golden retriever
09/05/2006




Business Lead: Investing in international property
The Speculator: David Haselhurst
The Innovators: Just Cuts


Finance>Personal finance
Finance>Shares


Where there's smoke there's fire, so The Speculator, David Haselhurst, is taking a trip on the Gateway express.

Shares in Gateway Mining (ASX code: GML) ran to a 12-month high of 24¢ early this year after the middle-rank gold prospector announced a potential joint venture with Placer Dome Australia (now a subsidiary of the world’s largest gold miner, Barrick Gold of America).
Since then, Gateway shares have drifted back to current prices of around 17¢ to 18¢, despite the solid surge in the world gold price and confirmation a couple of weeks ago that the Placer deal will go ahead. Gateway has two advanced prospecting ventures:

The Gidgee gold project contained within 400sq km of exploration tenements (see map) located in the Gum Tree greenstone belt some 400km north of Kalgoorlie, Western Australia.

The Cowra gold-copper prospect on the Lachlan Fold Belt in the Central West of NSW.

Gidgee is the prime focus. After three months of due diligence, Placer has now confirmed it will spend $4m to earn 70% of selective tenements totalling 80sq km within the Montague project area. Placer must spend a minimum $400,000 in the first year before it may exit, and both companies agreed that any further acquisitions adjoining the area will be shared Placer 70%, Gateway 30%.

I understand Placer will hit the ground running with a drilling program, involving diamond core to depths of up to 600m, due to start in June.


Gateway chairman Brian Gomez (an earth science graduate and sometime resources writer) claims that Julia’s Fault and Victory Creek within the joint--venture area are multi-million-ounce gold targets, “making them among Australia’s most attractive gold exploration prospects to be tested this year”.

Placer has farmed into the area following Gateway’s completion of a 3D gravity and magnetics study together with multi--element analysis to delineate an exploration model that confirms the potential of the area to host a large gold deposit.

Gateway itself will now focus on the remaining areas at Gidgee in which it retains 100%. A 4000m rotary airblast (RAB) drilling program was due to begin last week.

At the Cowra gold-copper prospect in NSW, Gateway’s joint-venture partner, the Canadian-listed Goldminco Corp, announced plans in mid-March for three reverse-circulation holes on three gold skarn magnetic targets. Goldminco must spend $2m to earn a 70% interest. Results are awaited.

Gateway now has 101.1 million shares on issue, which at 17¢ gives the company a market capitalisation of $17.2m. At December 31, the company had $252,000 in net current assets but topped that up in February by $1.32m through a placement of 8.8 million shares at 15¢ each. In March, one of our portfolio stocks, the Queensland gold developer Citigold, announced it had acquired off-market 16.3 million Gateway shares at 16¢ as a “strategic investment in a progressive and focused company”. So we’ve lined up, too.

Meanwhile, readers who followed The Speculator into Giralia Resources, bought on April 5, should have news next week of a free issue of shares in U308, Giralia’s uranium prospecting spin-off. Two weeks ago, we reminded readers that investors registered by April 26 could vote in a meeting scheduled for last Friday to distribute 32 million U308 shares held by Giralia free to its shareholders. The free issue should be completed late this week on an expected basis of one spin-off share for every 4.6 Giralia shares held. Since The Speculator holds 10,000 Giralia shares, we should pick up 2150 free U308 shares, presuming there will be some rounding to avoid messy odd lots. U308 shares were yet to list at last week’s close, but its initial prospectus offering 25 million shares at 20¢ closed heavily over-subscribed on April 13.

Apart from that, Amadeus Energy, one of our star oil and gas investments, released a magnificent quarterly report last week confirming record gross revenue from oil and gas sales in the latest March quarter of $US11.5m ($15.24m), almost treble the sales recorded in the previous March quarter of $US3.6m. The booming revenue was due to rising production from successful exploration plus high West Texas spot oil and gas prices.

Amadeus derives all of its production from joint-venture oil and gas projects in the US states of Texas, Kansas and Oklahoma. Oil and gas production for the full 2004-05 year has been exceeded already in the first nine months to March 31. Net oil production for the nine months to March 31 totalled 351,419 barrels, compared with full-year production for 2004-05 of 282,570 barrels. If the March quarterly rate of production is sustained for a full 12-month period, it will equate to a production rate exceeding half-a--million barrels a year (Amadeus’ share; net of royalties). At the same time, net gas production for the nine months to March 31 at 718,818mcf far exceeds full-year production in 2004-05 of 298,670mcf.

Of 20 exploration wells drilled in the nine months, 12 were successful: a success rate of 60%. Exploration expenditure for the nine months was up sevenfold to $US4.09m.

Last week, Amadeus and its joint venturers drilled their first well in a 243ha Texas block covering the Grapeland field, discovered in 1947 but abandoned prematurely due to poor production practices, lawsuits between partners and poor hydrocarbon prices. The well, Pennington 1, discovered seven feet (2.13m) of net pay and was cased for flow testing. The well gives confidence to engineering studies that concluded the field originally had 12m barrels of oil in place and, with a 30% recovery factor, another 1.4m barrels should be recoverable. Amadeus’ share will be 53.5%.