tempted by fertiliser (news article)

http://www.theland.com.au/blogs/the-punter/tempted-by-fertiliser/2686810.aspx

Tempted by fertiliser

Minemakers has a measured and indicated resource of some 300 million tonnes of phosphate at 18.2 per cent phosphorus pentoxide at Wonarah in the Northern Territory.

It is also in the happy position of having some $25m in cash and no debt.

It expects to have a feasibility study for Wonarah completed before the end of the year.

But you have to be a contrarian to buy into this business, when the price of rock phosphate has fallen from $US185 a tonne in December 2012 to $US101/t at the end of 2013.

Whether the shares really take off or not probably depends on the Improved Hard Process (IHP) technology being developed by JDC Phosphate in the US.

Minemakers has a small stake in JDC and exclusive rights to use the technology.

A small trial run of IHP in Florida in October was encouraging, but the demonstration plant had to be taken down for modifications afterwards.

It has still to be tested on a commercial scale.

Given the Punter has already sunk almost $6000 into MAK, he has decided not to buy any more.

Instead he has placed an order for an old favourite, the silver explorer Investigator Resources (IVR).

Investigator reported last week that assays from shallow drilling around its major Paris discovery show that “Paris has large prospective extensions open to aggressive exploration in 2014”.

Three things appear to have hammered IVR shares from 35c early in 2012 to around 5c now.

The silver price has slumped from around US33c to US19c an ounce; the geology around the Paris discovery is more complex than first thought, and drilling of some nearby targets late last year was somewhat disappointing.

But it does have an estimated 20m ounces of silver at shallow depth, and at the end of September had $4.6m cash reserves.

The Punter has placed an order for 30,000 IVR at 5.2c, just below the market.

Meanwhile, he is dumping energy and resource explorer and developer Baraka (BKP) which is having a fight with its farm-in partner, the Norwegian giant Statoil. Not good.

The Punter has no financial qualifications and no links to the financial services industry. He owns shares in a number of companies featured in this column.