dreaming of fortes potential (ref: extract)

As many posters on this thread will be aware, Extract Resources is one of the companys all Junior U308 prospectors would love to emulate.

I attach a link below to an excellent audio presentation by Richard Hemming (Extracts Business Development Manager) to the AMEC 2009 National Mining Congress on 27th May 2009. He outlines how it all began as well scoping plans for the future.

Its about 25 minutes long so as Bonobo(iii) would say grab yourself a gingernut (or two) and a cuppa, sit back and enjoy:

http://www.brr.com.au/event/57862/partner/theaustralian

What is interesting (for me anyway) is that all exploration companies have to start somewhere.

Extract spent 18 months undertaking 45,000m of drilling at Ida Dome in Namibia before posting their maiden jorc resource, a relatively modest 25m lbs@ 213ppm. Remember FTE have posted a maiden resource at Firwana of 11.6m lbs after scoping the resource for a similar time period time but after much less drilling. Firwana is likely to upgraded to around 15-25mlb in the months ahead once further drilling/density ugrading has been completed (imho). Matrix think 20mlb is a 'near certainity'

Extract then stuck it big (very big) at Rossing South in Feb 2008 with 'Zone 1' and 'Zone 2' now inferred U308 resources of a whooping 100m lbs+ each (ps its the depth of the grades which makes Rossing so massive)
Zone 2 looks like it will be upgraded significantly as time progresses.

Could one of FTEs future prospects be a 'company maker' just like Rossing was?

Given the range of prospects to be investigated particularly at Bir Mogehin, Beso, Leg Behja and Anomaly 068 and taking into account the very promising initial assays of upto 9300 ppm at some holes, there is certainly much potential to dream about. Leg Behji is particularly exciting and the imminent results from Bir En Nar (Jorc of 8-12mlb?) could turnout to be a bit of a sideshow in comparison.

If Matrix & Hanson Westhouses conservative valuations are even half accurate (see my post a few weeks back: Valuation of Forte - far too cheap?), at the current share price of 9.5 to 10p most of this 'potential' (ie potentail resource in addition to Firwana/Bir En Nar) comes almost for free!

What is also interesting from the presenation is that 108 mlb Rossing South 'Zone 1' is only 2.2km long (so far) and is mostly of medium grades (430ppm) and of similar geology to FTEs prospects (mainly granite hosted Calcrete deposits). It was 'entirely under sand' hence why it wasent discovered sooner. Ring any bells?

Note from the FTEs recent updates that Leg Behja is a potential 10km long by 0.5km wide calcrete deposit where initial assays at adjoining sites have returned results of up to 9300ppm (at Anomaly 068). If we seen some nice depth figures to go with the grades we can really start dreaming.

In conclusion, FTE is a very early stage exploration company with some very interesting tennants to explore particualrly in Mauritania. As we really dont know what the future holds, it is a high risk play. Howver the interest of Aveva, initial jorc at Firwana and the currrent valuation does de-risk this investment a little with a floor at 5-6p (unless they declare Firwana uneconomic) and upside of ??? Matrix (kiv - they are FTEs broker) believe 24p per share can be justified if a 40m lb resource is confirmed.

The management or more specifically the current lab delays are a little frustrating to say the least. I say the management as FTE seems to have a history of 'lab delays'. Having said that hopefully we wont have too much longer to wait. In the meantime we can all continue to dream about what may lie ahead.

D