KOR 0.00% 0.8¢ korab resources limited

ferrets stock to watch: korab resources ltd

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    Ferret's Stock to Watch: KORAB RESOURCES LTD
    09:11, Monday, 26 March 2007

    A COMPANY ALREADY CASHING IN ON SOME OF ITS URANIUM ASSETS

    Sydney - Monday - March 26: (RWE Aust Business News)
    ****************************************************

    OVERVIEW
    ********

    Korab Resources Ltd (ASX:KOR) is a diversified resources company
    with a portfolio of gold, uranium, magnesium, copper, cobalt and zinc
    assets.

    Investors have been combing through companies with encouraging
    uranium prospects in the light of a change in policy relating to the use
    of uranium power plants in Australia.

    Last week the Labor Party announced a review of its anti-nuclear
    policy and the acceptance of new local uranium mines.

    Korab has been currently restructuring its uranium assets.

    Among Korab's 10 projects on its plate are:

    * Maitland project, which adjoins the Lake Maitland uranium
    deposit in Western Australia, contains several extensions of this deposit
    and has a potential to host commercially viable calcretic style uranium
    mineralisation;

    * Batchelor project in the Northern Territory covers the same
    stratigraphic horizon that hosts a number of nearby uranium, polymetallic
    and gold mines and resources. Korab has already developed a number of
    advanced uranium and gold targets that it expects to drill test in the
    near term. Batchelor project contains the Winchester magnesium deposit
    which as a JORC compliant resource of 16 million tonnes MgO which is
    sufficient for a mine life of 25 years with annual production of 50,000
    tone of magnesium metal; and

    * Green Alligator project near Batchelor covers an area of over
    100 square kilometres of highly prospective ground. It abuts the
    Woodcutters zinc/lead mine and contains several gold anomalies as well as
    radiometric highs.

    Following numerous enquiries from sharebrokers, shareholders and
    prospective investors, Korab Resources has offered the following
    information to the market:

    * Transfer of the uranium rights from Korab Resources to its
    wholly owned subsidiary Uranium Australia Ltd was settled on February 27.

    * The in-specie distribution of Uranium Australia shares to Korab
    Resources shareholders will be put to a vote by Korab shareholders at a
    general meeting yet to be called.

    * The distribution record date for the in-specie distribution of
    Uranium Australia shares to Korab Resources shareholders has not been set
    as yet.

    * At the time of an in-specie distribution of Uranium Australia
    shares to Korab Resources shareholders, any Korab shareholder who holds
    Korab shares on the Distribution Record Date will be entitled to receive
    between 1.61 and two free Uranium Australia shares for every one Korab
    Resources share held.

    * The entitlement record date for priority allocation of the
    shares in Uranium Australia during any initial public offering of Uranium
    Australia shares has not been set as yet.

    * Any Korab shareholder that holds Korab shares on the
    entitlement record date will be entitled to a priority allocation of
    shares during any IPO of Uranium Australia.

    SHARE PRICE MOVEMENTS
    *********************

    Shares of Korab Resources on Friday edged up 0.5c to 80c. Rolling
    high for the year is 98c and low 20c. The company has 30.7 million shares
    on issue with a market cap of $24.5 million.

    Meanwhile the most advanced of Korab's projects is Melrose gold
    project where Korab is focusing on bringing to production an established
    JORC compliant gold resource of 306,000 ounces.

    The resource includes higher grade near-surface supergene zones
    and high grade shoots assaying up to 211 g/tonne (over six ounces of gold
    per tonne of ore).

    Melrose project lies in Wanganoo gold belt in Western Australia
    500 kilometres north of Kalgoorlie and 40 kilometres east of the Yandal
    gold belt which hosts around 18 million ounces of gold in several
    multimillion ounce deposits, including Jundee, Bronzewing, Thunderbox,
    Darlot, Centenary and others.

    Recent review of the $10 million database of geophysical,
    geochemical and drill data acquired as part of the Melrose project
    purchase has produced structural gold targets stretching over 30
    kilometres within the Melrose project and increased the potential of the
    Wanganoo gold belt to host a multi million-ounce gold deposit.

    Close proximity of Melrose to existing processing infrastructure
    at Darlot and Bronzewing provides Korab with an early development
    opportunity.

    Korab has arguably one of the best portfolios of uranium projects
    in Australia.

    In addition, Korab's portfolio of projects includes advanced
    projects in Western Australia and the Northern Territory with potential
    for polymetallic mineralisation including gold, copper, uranium, zinc and
    magnesium.

    Korab is led by an experienced management team with proven
    project acquisition and development skills.

    As at February 28 the company held equity or was earning equity
    in 10 projects in Western Australia and the Northern Territory.

    In December the company opened an office in Beijing, China.

    The operating loss after income tax of the economic entity for
    the half year to December 31 was $482,728 (2005: $188,471).

    The economic entity's basic loss per share for the year was 1.07c
    (2005: 0.49c).

    Since February, the company and its wholly owned subsidiary
    Uranium Australia signed a binding, unconditional agreement to transfer
    to Uranium Australia the rights to 90 per cent of uranium and thorium
    mineralisation within projects where Korab has or is earning an interest.

    Consideration is $2.63 million, which will be satisfied by a cash
    payment of $2 million and an issue of 90,000,000 shares in Uranium
    Australia.

    On February 27 the company and Uranium Australia settled the
    transfer of rights.

    BACKGROUND
    **********

    Korab Resources Ltd was listed on the Australian Stock Exchange
    on August 31, 2005.

    The company was formed in March 1998 to explore projects within
    Western Australia and to seek advanced exploration and resource
    development opportunities within Australia and overseas.

    The company brings together an experienced Board and management
    team with a strong record in the acquisition, exploration and development
    of resource projects.

    To maximise the benefits of this experience and in recognition of
    the risk and speculative nature of the junior resource sector, Korab
    limits its exploration and acquisitions to those projects which have the
    potential to return significant rewards to the company and its
    shareholders.

    Korab's portfolio includes:

    Those projects, whilst having significant merit in their own
    right, also provide Korab with the strong exposure to the exploration
    sector thereby assisting the company in securing other advanced projects,
    both within Australia and globally.

    * The Melrose project in Western Australia which contains an open
    at depth resource of 306,000 ounces of gold plus several targets ready
    for drilling.

    * The Mt Elephant project contains several volcanogenic base
    metal and gold targets. Recent drilling in the main area of outcrop
    produced 3 metres @ 1.32pc Cu from 105 metres. At the same time a number
    of sub-cropping gossan zones have been identified up dip from this
    horizon and will form early targets for further testing.

    * At the Darlot East project our consultants have identified
    exploration targets for structurally controlled deposits that formed
    synchronously with the Darlot deposit. Aeromagnetic surveys and
    geochemical sampling have produced several targets for drilling.

    * Throssell project covers an area of anomalous magnetics and
    gravity adjacent to the interpreted northeast limit of the Yilgarn
    Craton. This project provides potential for the discovery of buried
    greenstone belts in an under-explored locality.

    ENDS

    Copyright © 2007 RWE Australian Business News. All rights reserved.
 
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