Stand alone mine? Joint venture? Takeover? Nice to have several options!
IMO,Ambrian again highlight the possibility of a takeover in their report today............
Extract quarterlies - drilling gears up 30 October 2009
Extract Resources, in which Kalahari Minerals* owns a 40.88% stake, have released their quarterly report.
In addition, 5.2m shares from the recent Canadian placing will be admitted to trading on November 3 (we estimate ownership of 39.8%).
There are currently 11 drill rigs on site (more being sourced), with several rigs dedicated to infill drilling for reserve definition to support a bankable feasibility study (BFS). Drilling over the quarter has indicated that Zone 1 and Zone 2 join at depth, while initial pit optimisation suggests scope for a larger pit to include additional resources that extend deeper than the current drilling (ie scope for reserve increases at depth as well as along strike).
The key take-away from today’s quarterly is that investors should expect the Rossing South resource not only to rapidly grow in size given the large number of drill-rigs on site, but to progress toward a bankable feasibility study with the close-spaced drilling for a reserve and geotechnical work underway.
While construction may be some time off, the point about rapidly completing a BFS is that it enables application for a mining licence, which adds significant value to any project in a bid situation.
The arbitrage continues between Kalahari and Extract, as Kalahari trades at an 18% discount to its value in Extract.
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