Short Term Trading Weekend Lounge: 5 - 7th August, page-105

STTCOMP WFE, FA Long
SP: $0.004
SOI: 823m
Market capitalisation: $3.2m
Cash: $623k

Recently announced in their ASX price query that it is in negotiations to acquire a majority interest in an advanced exploration Gold-Silver-Copper-Zinc project. It also listed the terms of the proposed transaction although they have not been finalised as yet.

Also, thanks to posters on the WFE thread, it seems that the project they are looking at is in fact the Lomero-Poyatos Gold-Copper-Zinc project in Spain, which is held by Kimberley Diamonds Ltd (ASX: KDL).

Lomero is a 1km-long tabular volcanogenic massive sulphide (VMS) deposit with elevated gold content. Previous mining operations extracted at least 2.6 million tonnes of massive sulphide ore containing an average grade of 5g/t gold and 1.2% copper. KDL in their last quarterly mentioned that it was evaluating the potential for a profitable re-development of Lomero through its wholly owned Spanish subsidiary, Alto Minerals S.L.

The project is surrounded by majors, including Rio Tinto, Glencore, Lundin Mining and Trafigura Mining Group. See figure below:


However, the above is still speculation but there are distinct hints pointing to the above project. Firstly, as stated in the price query, in order to acquire an initial 10%, WFE is required to spend 400,000Euros in the first year. This is the exact amount that KDL is required to spend in the first year. As mentioned in their quarterly, “The granting triggers the commencement of the Year 1 expenditure commitment of 400,000Euros…” Noting KDL’s cash position, I believe that they will be desperate to get a farm in partner who can cover these expenses.

Quarterly (KDL):


ASX price query (WFE):


In addition to that, it is noted that both company share similar board of directors with Alexandre Alexander (Non-executive chairman of KDL) and Noel Halgreen (Managing Director of KDL) are also directors of WFE.


If the above is accurate, with a market cap of only $3.2m, it is in my opinion that WFE has the capacity to multi-bag. This is an advanced project with great potential due to historical mining and nearology.

According to the recent ASX price query announcement, it seems that negotiations are already very advanced for them to even have the terms disclosed. If there was much uncertainty, I don't think the company would have detailed this to the public.

DYOR as always.

PS: Sorry for re-post - pictures did not upload last time.

Charterrierist