Western Metals THANKS to last year's boom in uranium exploration stocks, Western Metals (ASX: WMT) pulled in $25 million from a share placement.
Interest in the group's uranium exploration ground in Tanzania has not gone away and, if anything, is about to pick up with the start to a new drilling program.
But as the fizz has come out of the uranium sector, for the time being at least, there should be no surprise that WMT shares have drifted down to 9.9¢.
That would be the end of the story if it were not for the strategy by the mainly ex-WMC Resources management team that came on board at the resurrected WMT in June 2006 to make the new-look WMT more than a one-commodity or one-project play.
Sporting $27 million cash after last year's raising, WMT searched for a new near-term development opportunity to flesh out its profile. It has landed an interesting one, too - Parys Mountain on the Isle of Anglesey, in north Wales.
Parys Mountain, quite possibly the world's biggest copper mine in the 18th century, is also said to have provided the copper for Lord Nelson's flagship, HMS Victory. But it is the modern potential of the copper/lead/zinc and precious metals-bearing volcanic massive sulphides system that could be a game-changer for WMT.
Because the stock exchange has tightened how explorers report on resource estimates, WMT was given approval to report once - and only once - an (indicated and inferred) resource estimate pulled together by previous owners.
Garimpeiro will make it twice by quoting from the once-only stock exchange announcement that put the resource at 7.76 million tonnes grading 2% copper, 2.4% lead, 4.9% zinc, 39 grams of silver a tonne and 0.33 grams of gold a tonne.
That's valuable dirt, and there is exploration upside. WMT can secure it all in a staged payments deal worth $29 million, most of which can be in shares if WMT so decides, and subject to completion of due diligence to its satisfaction.
Completion of a bankable feasibility study into a development inside of two years is the plan.
WMT Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
