No. Shares: 205.0m Avg. Monthly t/o: m Mkt Cap: $60.5m Last Reviewed SCG 282 52 Week High: $0.425 Low: $0.058 Waugh goes into bat for Sipa.
SRI's share price has retreated from its recent highs following the release of the initial resource estimate for the Waugh prospect. A figure of 704,000 tonnes grading 5.91 g/t for a contained 134,000 ounces is a good start. Waugh is still open to the east going into the Limerick Hill joint venture ground, held with Newcrest Mining. Newcrest is able to earn 70% of the Limerick Hill JV, which contains 23,000 ounces of the initial Waugh resource.
Of potentially greater significance is the 11 kilometres of strike and 12 priority targets along strike from Waugh. These targets have highly encouraging geochemical anomalies and the same ironstone outcrops and veining as at Waugh. Diligence is the next most easterly target from Waugh. Scout drilling has already returned 4 metres grading 20.7 g/t from a depth of 5 metres. All 36 holes drilled on the prospect encountered the lode and most reported mineralisation.
SRI has also identified several exciting targets near Mt Olympus on its 100%-owned ground.
We believe there is excellent potential for more Waugh-style orebodies. Coupled with this exploration appeal, the mine life at Mount Olympus appears likely to be extended beyond earlier expectations due to better than expected grades in some of the lower grade stockpiles. These now appear to be economic propositions.
Investors have naturally wanted to take some profits after SRI's solid share price gains since late 2001. This pause may not last long and we continue to recommend the stock as a speculative buy (we have done so since the stock was 7.2 cents). We believe the stock is capable of reaching 50 cents on its next leg.
SRI Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
