coppertunities...

Excerpt from 'The Australian' article: (Better-Than-Expected)!

Source: www.theaustralian.news.com.au
Coppertunities

WITH the copper price rebounding modestly, perhaps it's time to become re-exposed to the industrial world's most useful base metal.

We're not talking about smelting those hoarded coins or stealing railway signalling wires, nor are we talking about Xstrata's vaunted takeover target, Cloncurry hopeful CuDeco (CDU, $3.74).

Instead we'll focus on Hillgrove Resources (HGO, 24.5c) and Universal Resources (URL, 14.5c), two putative producers valued at far less than CuDeco's market cap of $300 million. In December, Hillgrove (market cap $60 million) commissioned a definitive feasibility study on its Kanmantoo mine in the Adelaide Hills, vaunted as a 263,000 tonne resource at a grade of 0.94 per cent.

The project gained further momentum with this month's placement of 22 million shares at 23c a pop (raising $5 million).

Universal's main wheeze is its Roseby project near Cloncurry. As of November last year, the company had confirmed proved and probable reserves of 312,750 tonnes of copper and 66,690 ounces of gold.

Universal last year completed a definitive feasibility study and is negotiating project finance. It has also finalised native title agreements with the Kalkadoon.

Intriguingly, CopperCo (CUO, 50.5c) and Xstrata feature on Universal's register, with the latter holding an option to buy 51 per cent of the Roseby project.

"When you consider the size of Universal's copper inventory, its cash on hand, the prospectivity of its tenement holding and its paltry market capitalisation, you would have to think it could become a takeover target," raves a reader with a wad of Universal scrip.

In our view both stocks are a SPECULATIVE BUY. Hillgrove's stake in coal seam methane producer Eastern Star Gas alone is worth $22 million.

Of course, those who crave an instant copper fix should just buy into BHP Billiton or Rio Tinto.

While copper remains 30 per cent below its mid-2006 high point, sentiment has improved.


End.

Cheers, Pie