54 World Mining Stocks February 2008 Tanzania Australia US Christopher Greig Chairman Dr Christopher Greig was appointed non-executive chairman of Western Metals in September 2007. Dr Greig is a chemical engineer. During a career spanning 20 years, he has held senior corporate and project roles in privatelyowned and -listed companies with exposure to the engineering and construction sectors in Australia, Asia, Africa, Latin America and Europe. GEORGE BAUK Managing director Mr Bauk was appointed managing director of Western Metals in June 2006. He has accountability for the company’s operations, governance and management. Mr Bauk has over 15 years’ experience in financial and commercial management in Australia’s resources development industry. He brings to Western Metals leadership commercial, strategic planning and negotiating skills complemented by a technical finance and accounting background. GEO FF CH APMAN Executive director Mr Chapman was appointed an executive director of Western Metals in June 2006. He is a qualified geologist with over 20 years’ experience in the mining industry, primarily in Western Australia’s goldfields region. During his career, he has undertaken a broad range of roles including as an exploration and mining geologist, mine planning, project evaluation and senior management. His experience has covered both large and small scale open-pit and underground operations with major and junior companies. PETER SMITH Executive director Mr Smith was appointed executive director of Western Metals in September 2007. Before, Mr Smith was the company’s non-executive chairman. Mr Smith is a senior executive with nearly 30 years’ experience in the minerals sector, with expertise in building, operating and achieving the turnaround of large complex businesses at corporate and operational levels. Marc Ca rdaci Non-executive director Mr Cardaci has over 15 years’ experience in running private businesses across Australia focused on the highly competitive transport and distribution industry. Mr Cardaci has an economics degree, coupled with hands-on business experience. Mr Cardaci is currently group CEO for the CFC Group of companies including Centurion Transport Ltd. Aggressive exploration with an eye for fresh opportunities THE new broom at the revived Western Metals Ltd has been doing plenty of sweeping and is looking at 2008 as a year for new opportunities. The company was born out of the funeral pyre of the old Western Metals that mined lead-zinc-silver in Western Australia and went a bridge too far in terms of project financing and was also hit by currency, commodity price and financial difficulties. The new Western Metals evolved late in 2005 when the old company’s receiver-manager assigned the company shell with A$3 million in cash, to make a fresh start. Now leading the company is George Bauk, who told WMS that unlike many companies today whose professional and skills base have been stretched, Western Metals has a management and senior executive group that has been attracting well qualified people to join. With fresh capital and an experienced exploration team, Western Metals will be an aggressive spender on exploration – for uranium in Tanzania and in the US, THE TE AM WESTERN MET ALS Drilling at Mtonya Project in Tanzania Tenure map of the southwestern Tanzania property February 2008 World Mining Stocks 55 U Ag-Pb-Zn Ni Cu for copper-gold in Peru and for Broken Hill-style lead-zinc-silver in the West Georgetown area, inland from Townsville in north Queensland. With over A$30 million in cash reserves, WMT has flagged an aggressive approach to project acquisition opportunities. That approach has already paid early dividends, with the company acquiring the highly prospective Snowbird nickel-base metals project in Canada’s Northwest Territories from BHP Billiton in December. The property covers over 260km2 and comes with an extensive geological database gleaned from programmes dating back as far as the 1950s, including the results of an intensive programme comprising versatile time-domain electromagnetic surveying, mapping and sampling completed by BHP in 2005. The company’s 60% stake in a tin project in Zeehan, Tasmania, does not fit Western Metals’ project criteria and has been placed on the market. Perth-based resource finance and advisory group Azure Capital has been engaged to look for a new project for the company and also to assist in structuring the company’s growth strategy. Mr Bauk says that with the ability to both explore and development, the company is looking for a project that might provide a “defining moment” – like Oxiana Ltd’s adventurous move into Laos to prove up and develop major copper and gold deposits. He is satisfied with the progress being made in Tanzania on uranium, the US acquisition and the fact that native title clearances have been given to allow the West Georgetown search programme to begin – where this year’s search budget may be about A$2 million. More results are expected from the Mtonya uranium properties in Tanzania, following the October programme that produced high-grade intercepts at the Moysten prospect (3m grading 863ppm U308 from 46m depth, 3m grading 750ppm U308 from 47m and 2m grading 355ppm U308 from 32m). Trenching at the Grandfather prospect raised eyebrows in that same campaign, with high grades from a strike line of 1.4km, including 1.2m at 7,723ppm U308, 1.2m at 2,393ppm U308 and 1.2m at 4,773ppm U308. Western Metals is moving to 60% equity in the Mtonya joint venture with Uranium Resources plc and is project manager. It is also 42.5% equity holder and search manager in other Tanzanian uranium properties – the Makwebe and Kapinga joint ventures. The quest is for sandstone-hosted roll-front style uranium deposits, similar to Paladin Resources’ Kayelekera project in Malawi. The Glade uranium project in southwest Colorado is near the Four Corners area that takes in border country for Utah, Colorado, New Mexico and Arizona – a highly active region for uranium exploration, taking in areas mined for uranium in the past. Western Metals holds 60% equity in joint venture with Lynx1 LLC and is earning an additional 2% participating interest for every US$100,000 search expenditure – up to a maximum 85% stake. With permitting cleared, a drilling contractor was engaged late in 2007 to drill up to 6,000m to evaluate the northwest portion of the licences within the Salt Wash Member of the Jurassic Morrison Formation, a geological sequence that contains historic mines. The Lukkacha copper-gold project in southern Peru is seen as a target for large tonnage copper-molybdenum- gold porphyry deposits similar to those being mined in the region – including Cerro Verde. Western Metals holds an exclusive right to a 51% stake and the right to increase to 70% after reaching financial commitments and then consolidating to 100% with further undertakings. There are nine contiguous licences covering 60km2. The company was awaiting Peruvian government approvals to operate as a foreign company within the 50km buffer zone that forms the Peruvian-Chilean border. After entering into a joint venture with BHP Billiton on the West Georgetown permits an airborne magnetic and radiometric survey using BHP Billiton’s Falcon system identified four priority lead-zinc-silver targets on the northern of the two West Georgetown blocks. One anomaly has dimensions of 2km x 1km. The truth serum to be applied to these in 2008 is a lot of drilling. Western Metals can achieve 100% ownership but, as with so many BHP Billiton deals, the world’s biggest mining house has a claw-back provision. Western Metals will also be able to access BHP Billiton’s proprietary geophysical technology. Mr Bauk says these licences also have gold and uranium potential. VIT AL STATI STIC S Name: Western Metals Ltd Address: Unit 7, 100 Railway Road, Subiaco WA 6008, Australia Tel: +61 (0)8 6380 3600 Fax: +61 (0)8 9382 8022 Website: www.westernmetals.com.au CONT ACT Managing Director: George Bauk SHARE IN FOR MATION Listed: ASX Ticker: WMT Market cap: US$52 million Net cash: A$30 million ASSOCI ATE S Legal counsel: Freehills Share registry: Security Transfer Registrars Auditor: BDO Audit and Assurance Corporate advisor: Azure Capital 0.00 0.10 0.20 0.30 0.40 0.50 Jan 2007 Jan 2008 Share price (A$) Trading volume 0 30000000 60000000 90000000 120000000 150000000 PRO FILE Western Metals acquires option for 100% of Canadian nickel/base-metals project “With over A$30 million in cash reserves, WMT has flagged an aggressive approach to project acquisition opportunities”
WMT Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
