FROM THE AGE TODAY:BARRY FITZGERALDNovember 25, 2009 - 10:15AM...

FROM THE AGE TODAY:
BARRY FITZGERALD
November 25, 2009 - 10:15AM
The exploration effort of Top End uranium explorer Rum Jungle Uranium (ASX:RUM) is moving south for the wet season, leading it to the Tennant Creek mineral field, one better known for is high-grade pods of gold and copper mineralisation.

The work program at the company's Windgap uranium prospect at Tennant Creek has just kicked off and could be worth watching. Just ask the cattle that have run into trouble over the years after picking at what little feed can be found at Windgap.

It turns out that the groundwater at Windgap is what you might call highly uraniferous, up to 16 parts per million if you don't mind. Too much of that concoction from the water bore and the cattle fell over, prompting the cattle men to move the cattle on to greener and less poisonous pasture.

Bad news for the cattle all right. But it also makes for a very interesting uranium prospect, one that Rum Jungle boss Dave Muller says just has to be drilled to find out what it is at depth causing the uraniferous groundwater.

That was exactly the same reasoning behind some drilling at Windgap by one of the major mining houses a long time ago. But a vertical drill hole that came close to clipping what modern-day remote sensing suggests could be the source of the uranium was pulled up too short and was off to the side of where Rum Jungle reckons the real action could be.

So it is now punching in a 500 metre angled hole designed to cut across the postulated uranium target. It won't take long to know if Rum Jungle is on to something, with the drill hole expected to progress at something like 60 metres a day.

Rum Jungle last traded at 10.5 cents a share, giving it a market capitalisation of $13 million. At the end of the September quarter it was holding cash of $7.2 million. So there is plenty of leverage for some exploration excitement.

Mind you, if Windgap was all Rum Jungle had on the go, you wouldn't touch it. But there is more in cupboard. Apart from its extensive uranium exploration ground in the Top End, the company has recently added potash and geothermal interests to the portfolio.

But none of it is advanced enough yet for Muller. In a tip to shareholders at the group's annual meeting in Melbourne earlier in the week, he let slip that there were a lot of opportunities to pick up an advanced project. And more to the point, there were opportunities to raise funds for the right sort of acquisition.

Muller wouldn't say anything more. But the chatter among investors after the meeting was that a move in to Namibia, and the acquisition of an advanced uranium project in the Northern Territory, could be on the cards. Watching with interest – and with some ideas – is Rum Jungle's 36 per cent shareholder, ASX-listed Wasabi.

Raisama Limited

Uranium prices have been a bit sluggish of late, with the global push towards nuclear power to reduce carbon emissions yet to be translated in to a shortage of the radioactive material.

But no one doubts that in the longer term, the world is going to need new mine supplies of uranium.

It is against that background that we are in for a test of the market's appetite for junior uranium explorers with the pending sharemarket debut of Perth-based Raisama. It pulled in $12.25 million from its float which was at the upper end of expectations. So investor demand is there all right.

Raisama is due to list on December 3, with subscribers to the float joined in the exploration hunt by China's state-owned Hebei Mining, Raisama's biggest shareholder. The Hebei provincial government, which owns Hebei Mining, plans to build at least three nuclear reactors.

Although it is Perth-based, Raisama's uranium hunt goes far and wide.

It holds exploration leases adjacent to Cameco's Kintyre uranium deposit in Western Australia, as well as projects in the Gascoyne region. More recently it added the Kashkasu project in the Kyrgyz Republic to its portfolio.

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The Age