the trip

As most who are watching the ARU story unfold will be aware, a few of us ventured north in late August to visit Nolan’s and Jervois.
This is a summary of the trip rather than an analysis of Nolans. For info regarding Nolans the ARU website is probably the best place to start… www.arafuraresources.com.au
All of this is my reading, I am no expert; just a shareholder.
As such all is offered in good faith but no guarantee.

What started out as a bit of a joke turned into a comprehensive tour of the two tenements and a great opportunity for us to meet and have a bit of fun.
Below is a bit of a run down for those that are interested.
I have held off so that Lenni could inform the people in Germany that had put in money to get Lenni to this trip and others to the presentation in Hong Kong (Friday). I must congratulate them on an outstanding job of working together and have no doubt that a new benchmark has been set. How do you beat that?

I had been to all the Australian states and ACT but had never been to NT, as such I decided a quick drive from Melbourne would be the way to go; as it turned out I reckon a pretty good decision… I was comfortable..
As I had things to bowl over in Adelaide and Whyalla it was a five day trip via Uluru (Ayers Rock) to Alice Springs to meet our small group at Lasseter’s. The first beer was a sweet one.

The next morning most were ready to head to Aileron, there were a few bleary eyes and I have a sneaky suspicion that some would have slept on the way.. 
Thinking I would be pretty smart and utilise the NT speed limit (130kph) I headed off a bit quicker to catch up with Pirra at Aileron… of course when asked at the road house he was not there!! Ah well a couple of cups of coffee later the rest catch up… then in walks Pirra…. “… been here 2 days…”
After a bit we head off to Nolans which is a stone throw from the highway…

When driving to Nolans you drive over the main gas line and it seems closer than I expected, even though it appears to of less importance it is nice to know it is nearby.
Upon entering the lease you quickly come across an outcropping that is quite obvious and agitates the ‘Geiger Counter’ a fair bit (see pic in earlier post). Principal Geologist Kelvin Hussey explained that this is not the rock for the kids to be playing with… (Can someone change his pic on the website… it’s a shocker). A quick drive around and looking at the core samples was good fun and highly educational. You quickly learn the importance of the Geos and that we have very good ones.
It is apparent that Nolans is quickly moving out of the exploration stage and into the final stages before development.
A few more stops highlighted the respect that Arafura pays the native fauna and the local indigenous peoples. We visited the nearby building where local paintings are available for sale. They were impressive and it was great to get an understanding of what these pictures are about.
That night was a camp at Aileron campgrounds (under the stars) and some more chatting, a highlight was a presentation of a cheque to the local Aboriginals that had been started off by the German investors; it is a real pleasure to see investors do something other than carry on about share price and they deserve real recognition for the efforts.. well done. A few local kids will now be able to go to Perth to play basketball and do things that they may well never have been able to do.. see the sea, a city etc..
It was really different and refreshing (made the more powerful by the location) to see the commitment to the local people, like most I have become pretty cynical of the talk fests and we should all be proud for our company and its people doing something positive.
The next day was off to Jervois.
Geez, this place just keeps getting bigger…
A pic for those of us still holding NUP..

It was a long drive along the Plenty Highway to Jervois, as Pirra mentioned we did see the Thor vehicles go past whilst we had luch.
The Plenty Highway is bitumen for about 70-80k and then varies between gravel and clay for the next couple of hundred km of our trip, this is quite important as most of the explorers out here will need to find something quite large to make building the essentials economical. This point is relevant for just about all companies exploring rural NT. Arafura acknowledge that Jervois will need to be big (they are quietly confident), size is obviously one of the major strengths of Nolans.
Everyone is a lot more relaxed at Jervois, we are straight into looking at the magnetite out-crops , it is quite amazing as some are just there looking at you.
Here the reasons for the delay in announcing Jervois results were explained, it is reasonably complex to try and explain here (and I am not the most qualified) but, in laymans terms, the results back from the labs were stating recovery of 150-180% which is patently not achievable; the ARU team (in conjunction with labs) developed a far more accurate method of measuring results and hence they were able to report the outstanding results that were achieved. It is interesting to note that several companies have not gone through this level of verification prior to announcements and have been burnt by having to post correct details later; well done ARU for doing it right first time.
When you realise that originally ARU was hoping to strike something in 8 of the 15 holes and yet got good results in 14 you realise the strength of the Geo team. Kelvin was suitably proud of the achievements here and my congratulations go to him.
When the loo was being dug (yep more stars) more magnetite was hit… this will be an interesting project.

Next day was more around Jervois and then back to Alice after dropping Pirra and Numbat off at Gemtree.
It was a great night and we had the opportunity of watching the eclipse of the moon in the NT skies.. spectacular but hard to get photos of at 130kph.
I was back in Melbourne 3 days later.

All in all it was a great trip, the thing that strikes you is the sheer size of South Australia and Northern Territory.
On the way there and back you drive past the turn offs to Olympic Dam and Prominent Hill, these joints are in the middle of absolutely nowhere but size has got them through, I am much more circumspect about some of the other explorers playing with small resources in the outback when you get an understanding of just how big this place is.
So what come out of the trip?
- The country is huge
- Nolans is huge
- Jervois is very interesting
- We have an outstanding crew that needs to grow (and is) to accomplish the tasks ahead but also to continue to grow our extensive portfolio of projects.
- Arafura is now an employer of choice.
- Kurinelli soil sampling is finished and in for analysis, a huge project that is for the medium to longer term.
- Now that Nolan’s is moving towards development stage, our established (and proven) team of Geo’s will now move into hunting mode at Jervois, Kurinelli and other potential projects.
- There are 3 sites earmarked for processing Nolans material, one will be chosen to meet our needs (acknowledging that consultation and approvals will be required).
- The company is committed to the projects and also to shareholders.
- There is am extremely strong and loyal group of shareholders that it was a pleasure to spend time with.
The key milestones ahead are PFS and trial plant, I feel comfortable that major players are waiting in the wings although no secrets were provided. Each of these milestones will demand a significant re-rating imho.
Should our expectations be met in the PFS and the trial plant I feel that people on this trip will become wealthy beyond their expectations.

There are a couple of caveats such as global market stuff ups we are watching and the increasing costs of building plants (Olympic Dam expansion will drive a lot of this), the flip side is that the increasing costs are going to make some marginal plays sub economic; this is a benefit for strong projects like Nolans.

Now if only those NUP guys would get out and do some digging..

All info imho and my interpretation.
Cheers.