matrix update

Matrix maintain a price target of 17p (30c)

RESOURCE, METALLURGY, RAIL LINK WHAT IS THE NEXT PIECE?

Forte has today released positive metallurgical results from its Firawa Uranium resource in Guinea V this is now a real project. In addition, yesterday, Belzone Mining announced funding to construct a major rail system in Guinea to service the burgeoning iron ore market in that country V a rail line that will run close to Firawa, thus opening up logistical access to this remote region.

The pieces are falling into place; what comes next?
-Forte has today released preliminary metallurgical testing results of ore from its Firawa uranium project in Guinea. The leach testing has demonstrated recoveries of 67.2% in the first pass. These results are from the first phase of testing only, without any fine tuning or optimisation of the process and should therefore be viewed as the minimum recovery that should be achievable. We would expect ultimate recoveries to exceed 75% with further work. We view this as extremely significant.
-The Firawa resource currently stands at a JORC compliant 11.7Mlbs, but the company has publicly stated that it sees an ultimate potential of at least 3x that size V a view that we share as the structure remains open at depth and along strike in both directions. This resource was defined in late 2009, but the company chose not to carry out further drilling until the extraction process had been confirmed as the clay content of the ore cast some doubt as to its amenability to simple heap leaching. This is now confirmed
- Firawa is amenable to simple and cheap heap leaching, opening the possibility that not only is it a very real, low-cost mining proposition, but also one that can now be expanded.

We see two major catalysts flowing from this announcement:
1. Drilling at Firawa will recommence, as soon as the weather allows, to expand this resource significantly.
2. Firawa should now become a target of interest for the large nuclear utilities. The current deal with Areva is about to expire and in any event does not cover Firawa. We would expect they and others will be keen to recommence discussions.

h In addition, yesterday there was an announcement by Bellzone Mining BZM.LN) confirming a large Chinese funding package to develop rail infrastructure in Guinea. The proposed rail would run very close to Firawa.
h We have a resource, it is amenable to cheap extraction, it should grow in size, transport is being put in place and other resources in Mauritania are due any day. Good news has been slow coming, but is arriving at last.