Here is an update related to FML by Hartleys. They have visited Treasure Island. Visited a number of prospects, all contained Visible Gold
Hartleys Research - PerthFML.asx Buy
Focus Minerals Ltd Site visit uncovers more ?Treasure? at Lake Cowan We recently had a site visit to Focus Minerals Ltd (?Focus?, ?FML?, ?Company?) Treasure Island Project, Lake Cowan, located ~50km southeast of Kambalda. We visited a number of prospects, all of which contained visible gold within an array of surface quartz veins. Some strike lengths of the vein systems were greater than 200m and remain open as they extend under cover. Multiple zones within the quartz veins have returned surface sample results greater than 20g/t Au from three main prospect areas Northern (45.4g/t Au), Central (58.9g/t, 48.4g/t and 41.3g/t Au) and Southern (33.3g/t Au). We see this project as an exciting early-stage exploration play that has the potential to yield a number of significant-sized gold deposits. Drilling starting soon Focus is about to commence initial diamond and aircore drilling at Treasure Island. The drilling will test targets defined through systematic geological mapping and surface sampling, where high-grade results of up to 58.9g/t gold was recovered from quartz veins. The Company also plans to test geophysical anomalies generated from the interpretation of a detailed airborne magnetic survey flown in late 2010. Approximately 1,800m of diamond and 8,000m of aircore drilling is planned. Good address with minimal previous exploration The Treasure Island Project sits on the southern extension of the Boulder-Lefroy Fault Zone, which hosts numerous high-grade gold and nickel deposits, including the Kalgoorlie Super Pit (+10Moz Au) and St Ives gold camp (~7Moz Au) which is less than 35km along strike. Previous exploration over the project area has been limited, due mostly to the salt lake making access to the island extremely difficult. Quad-bikes were used during the site visit to access the island with Focus planning on using a specialised diamond rig to test targets. Tindals open pits to commence in April 2011 Focus plans to commence open pit mining at Tindals, Coolgardie in April 2011. The Tindals open pit resource currently stands at 8.3Mt @ 2.3g/t Au for 608Koz gold. There are also multiple targets ear-marked for further drilling and development work. Open pit mining at Tindals has the potential to add 30% (+25Kozpa) of the ore requirement to the Three Mile Hill mill. By May 2011, FML will have three independent and growing, producing gold centres. The introduction of low-cost open pits will de-risk the operations by reducing the reliance on underground ore. The addition of the open pits will give Focus the potential to produce close to 12Koz per month, which implies a steady-state production of +130Kozpa. Upgraded our recommendation on FML to a Buy Focus remains hedge and debt free and with increasing production and accelerated near-mine and ?grass-roots? exploration we expect a good flow of news in 2011. We have an updated sum of parts valuation of 11.6c/share for the Company. We have not as yet assigned any value to Treasure Island which we see as a potential company making project. With investment sentiment for gold remaining strong, we have upgraded our recommendation on Focus Minerals Ltd to a Buy. 3 Mar 2011 Share Price $0.080 Valuation $0.116
Brief Business Description: WA gold developer/producer Hartleys Brief Investment Conclusion Three Mile Hill mill operating well. Building production to +100Kozpa in FY11. Reserves and resources expanding.
Chairman & MD Don Taig (Chairman) Campbell Baird (CEO) Top Shareholders- May 2010 ANZ Nominees Limited 13.0% HSBC Custody Nominees Limited6.9% Citicorp Nominees Pty Limited4.4% Company Address Level 10, 68 St Georges Terrace Perth WA 6000 Issued Capital 2,866m - fully diluted 2,960m Market Cap $229.2m - fully diluted $236.8m Cash and Bullion (31 Dec '10)$8.7m Debt (31 Dec '10) $0.0m EV $220.6m EV/Resource Oz $108/oz EV/Reserve Oz $831/oz FY10aFY11eFY12e Prod (koz Au)6288133 Cash Costs (A$/oz)806890746 Op Cash Flw283489 NPAT10.9 22.9 48.5 CF/Share (cps)0.8 1.5 2.4 EPS (cps)0.4 0.8 1.7 P/E21.0 10.1 4.8
Resources (Moz Au) 2.05 Reserves (Moz Au) 0.27
FML Price at posting:
8.1¢ Sentiment: Hold Disclosure: Held
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