Ostrava Equities Weekly Newsletter:As a result of the decline...

Ostrava Equities Weekly Newsletter:

As a result of the decline and general mood of the market and commentary turning negative, we see selective value in some stocks and sectors, including certain telecoms, mining services and resources companies.

Queensland Mining (QMN). This company run by Howard Renshaw is developing a number of copper/gold deposits around Cloncurry, near Mt Isa. The main projects are White Range and Cloncurry Goldfields.

White Range is targeting production of 20,000 to 25,000 tpa of copper utilising the cathode treatment of oxide ore. QMN proposes to use third party processing. The JORC resource position of the project is 36.7Mt @0.7% Cu, 0.03% Co and 0.2g.t Au. Total copper equivalent 338,000 t.

The Cloncurry gold project contains 1.6Mt @1.7g/t Au and 0.14Mt @ 4.2g/t being 108,000 oz.

Management are looking to advance production on the White Range, Greenmount Kuridala, Vulcan, McCabe and Young Australian for early cash flow.

The company has very advanced exploration status for 5 other copper projects and two gold projects which require more drilling and advanced exploration.

Independent experts have valued the White Range project at $92Mn on a NPV using 8% discount rate.

We would suggest a conservative IV of 24c for QMN shares vs last trade 8c - BUY.

In a recent interview management expressed extreme frustration with the current lack of understanding of the company by the market.


http://www.ostravaequities.com.au/specialreports/inner/ostrava-weekly-report-15-june-2011