the australian newspaperEuro Gas blasts off with 713pc gainRobin...

the australian newspaper

Euro Gas blasts off with 713pc gain
Robin Bromby, Investment
July 11, 2006
IT barely gets a mention in the financial press - after all, coal-bed methane gas in France's Lorraine basin is a little exotic - but European Gas was the junior resource star of the year.

Broker Intersuisse tracks 158 juniors, and in the year to June 30, European Gas was the winner, its 38.5c share price on that date representing a 713 per cent gain for the year.

It still holds territory in Western Australia, picked up when it went under the name Kimberley Oil. But it's the European deal that has propelled the price.

The company has a resource at its main French project of nearly a trillion cubic feet of gas, along with other projects in that country along with ones in Tuscany and Sardinia.

The main resources are close to large industrial populations. There are established pipeline networks and gas prices are three to five times what they are here.

The other European gas play listed here - Po Valley Energy - was well down on the Intersuisse list, but its price still managed a respectable 57.7 per cent price increase last year.

In second place, its 82c close on June 30 representing a 556 per cent share price rise, was Platinum Australia. Investors clearly liked its new platinum project in South Africa.

Chinese backing for its iron ore project in the midwest region of Western Australia gave Gindalbie Metals a 537 per cent boost for the year, its shares ending at 49c.

The company plans to begin mining hematite ore, and then will go on to develop a magnetite deposit with the ore being sent to the coast through a slurry pipeline.

Precious Metals Australia shares were up 465 per cent - a real turnaround from its desperate days after Xstrata closed down the Windamurra vanadium mine, on which it was depending for revenue.

But PMA is back, planning to be in vanadium production before any of its potential competitors that are trying to develop projects in the West.

A few years ago, having your main project in the Philippines would have been the kiss of death - WMC Resources had quit the country, and subsequent projects tended to get mired.

But Climax Mining's 421 per cent gain for the year clearly signals a change in investor sentiment.

The resources boom did not lift all boats. In all, 110 companies saw their shares higher at the end of the financial year than at the beginning (with Andrew Forrest's Moly Mines just scra ping in with a 0.8 per cent gain).

Forty-eight were down on the 12 months.

The wooden spoon went to Bluestone Tin - its 20.5c close representing a 69.2 per cent loss.

Put that down to its closure of the Renison tin mine in Tasmania, the core around which the company floated. Bluestone has recently announced a merger with Metals Exploration.

The other biggest losers: Tawana Resources (diamonds) was down 68 per cent; Legend Mining (even with legendary prospector Mark Creasy in control) dropped 63 per cent as investors worried about lack of progress on the Gidgee gold project; Innaminka Petroleum's dry holes knocked 61 per cent off its value; while slow project process sent Gravity Diamonds south by 60 per cent.

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