Thought you might be interested in a bit of revision while we wait for another upward surge (hopefully) when the market opens. Hard to find a lot of research on this company but this should inspire confidence. It was commissioned by MKY but nevertheless gives a good summary. Found on: - http://www.miningnews.net/default.asp - you can sign up for a free trial.
Cheers JD
Friday, August 17, 2007
THE acquisition of Queensland Uranium, completed late April, finally laid to rest the past life of Perth-based MKY Corporation, which is now restructured, recapitalised and focused 100% on uranium exploration. By Charles Amery - RESOURCESTOCKS*
The company has two highly regarded and successful industry heavyweights brought in as chairman and managing director, a new shareholder base and a new board, which has "absolutely no interest" in the corporate operations that previously took place with a vastly different mindset, in a vastly different industry.
Those operations were in fact in "alternative media" when MKY listed on the ASX in September 2004 – more precisely tabletop advertising.
Last year MKY went into voluntary administration, undertook a complete restructuring, issued a fully subscribed prospectus in August raising $1.9 million, and was re-listed in September. The past was buried but the future was very much alive.
Debt free and with an additional $450,000 cash injection from a fully subscribed share issue, what emerged has been a revelation for shareholders – a completely new corporate operation in the buoyant mining and resource sector.
MKY has a new focus, high-profile personnel with big company international experience in management, development and technical administration, and is a uranium player with credentials, some highly prospective tenements, high hopes and a "think big" philosophy.
Shareholders will soon be asked to change the name to Queensland Uranium Ltd, now already having the wholly-owned subsidiary Queensland Uranium Pty Ltd, and will move its administration to Melbourne where managing director Alan Fitzpatrick is already based.
With its uranium exploration focused solely in north Queensland, at least for the present, the company's technical headquarters will be beefed up and based in Cairns.
Later as exploration goals are achieved, a dual listing on an Asian-based exchange is also part of the considered future mix of the revitalised company, providing a further potential lift to the new shareholder base.
"MKY had a past life in which frankly we have no further interest. The entire shareholder base is now interested in resources and primarily uranium where the company is focused," chairman Allan Blood told .
The move to acquire Queensland Uranium came last November and simultaneously saw Blood and Fitzpatrick, both men used to being at the sharp end of multi-billion dollar big business operations, join the MKY board.
After the MKY restructuring and recapitalisation, it was literally looking for a project and the people who could kick-start the company in a new direction. Enter Blood, founder and former chairman of Australian Power and Energy (APEL), a subsidiary of the massive Anglo American Group formed to develop the $5 billion Victorian Power and Liquids Project – coal to gas to liquids.
After the takeover of APEL by Anglo American, Blood formed Australian Energy, which is currently undertaking a billion-dollar power/ammonia urea project based on coal gasification.
Enter Fitzpatrick, engineering and construction global operations director for Newmont Mining, responsible for implementing multi-billion dollar projects around the world including the current $1.6 billion expansion of Western Australia's Boddington gold mine.
"We had some very good uranium assets in Queensland, and the existing MKY board was looking for a project and management team. That's when I became involved. I have a background of doing very large things although mainly in the private sector," Blood said.
He said the two men had a "think big mentality" and were "not interested in tiddlywinks stuff".
"The company had no resource-based assets but was looking for some to give shareholders some value. It recapitalised and there were share issues at one and two cents. The market is now 5-6c. On that basis it has been quite successful and we tend to make it a lot more successful than that.
"The $450,000 share issue was because the bank balance needed to be topped up. We had a plan in mind, albeit a pretty frugal one, designed to get maximum results – which will start to be seen quite shortly – so we did not want to do any more dilution at that share price than we had cause to for the existing shareholder base.
"We are endeavouring to create an asset base for a small company which will represent our thought processes. We are hopeful that within some of the tenements which we first put into the company and secondly have been acquiring since, that there is certainly, from an exploration standpoint, the potential for that to happen.
"We have very high hopes, albeit early days, on some of the things we have done already and that some of the exploration results still to come out will give reality to the sort of aspirations we have, i.e. very good grades in a very good geological setting, widely spaced over a common geological target with the same characteristics from one side to another.
"We are keenly awaiting some assay test results at the moment.
"There is a strong geological team based in north Queensland with a high track record in ascertaining very meaningful geological targets. We are glad we have been able to attract a few very wise geos, one with a wealth of prior uranium experience. Together they form a significant partnership."
The company has flown airborne surveys over the Palmer River, Georgetown and Cape areas of its tenements and is interested in three distinct geographical areas.
Now it is a matter of sorting the radiometric results and higher readings that interest them and zeroing in on the areas where they hope is some uranium geology and the source may be the tenement, as opposed to thorium which can show up as a radiometric hotspot and accumulations in creek beds transported from elsewhere.
"We have dropped off some tenements, picked up others and added to some, looking at what's coming up. We now have two areas we are zeroing in on and are subject to assay results," Blood explained.
"One of lessons you learn very quickly in the uranium business is that uranium can transport itself a very long way and you can have some incredible grades, depositions of various kinds which have nothing to do with what is underneath your tenement.
"We are only interested if we can find something big. That is the nature of the management of MKY. We all have other investments and directorships.
"Historically Palmer River is renowned for gold. I think some of our tenements will have the potential for base metal but we like the area for uranium and our focus of course is on uranium."
For Blood, size does not matter.
MKY has tenements covering about 800 square kilometres but its main zone of interest is probably 16sq.km where it believes there will be "some exciting grades".
"These tenements will definitely be drill targets. We have isolated a couple of very interesting, very prospective tenements and will be drilling through the current dry season subject to rig availability," he said.
"We have both a short-term focus which will deliver medium and long-term results. That focus is to identify the geological targets and get some drillholes into them, initially fairly wide spaced to indicate potential size and grade and then talk about some form of resource calculation.
"The long term of course involves political considerations of government so from a shareholder/value perspective, how far do you take it?
"Today you are only allowed to explore, so the question is how far you explore once you have strong reason to believe you have a reasonably large and high-grade asset. There is no point drilling like a Swiss cheese because it is only going to add 10 percent to what you know in terms of size and so on.
"So our focus is short term, pure exploration, identifying significant resource potential and getting that resource to a certain size where it can be reasonably quantified.
"The world is going to get all the uranium it wants from somewhere. A lot will no doubt come from Australia. Why should it be South Australia and not Queensland or Western Australia? Why should one region of Australia get economic and jobs benefit over another when it can be shared?
"Let's assume the resource boom diminishes in some way futuristically. What will not diminish is the requirement for energy and clean energy.
"I am not advocating nuclear power plants in Australia or enrichment. I believe Federal Labor policy is, at this point in time, quite sound but if we are serious about greenhouse emissions, then nuclear must be part of the mix."
* This report, first published in the July 2007 edition of RESOURCESTOCKS magazine, was commissioned by MKY Corporation
MKY Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
