AAR - Astral Resources

[resourcesman]

Correct me if I am wrong, but i didnt see anything good in the report that was previously unknown? Having said that, this is the first piece of news in a long while so im guessing the SP is going to move up a little tomorrow, probably to 11.5c-12c.

 

[Ang]

Correct me if I am wrong, but i didnt see anything good in the report that was previously unknown? Having said that, this is the first piece of news in a long while so im guessing the SP is going to move up a little tomorrow, probably to 11.5c-12c.

Guys don't be fooled, read the announcment carefully as it is in line with what I know about what was not said.

The only results they have is from their west and part of their East Mandilla mine and not the entire East Mandilla mine. Their mine East of Mandilla runs for KM's and the further East you go the closer you get to the RMS mine.

Extracts from the announcement:

"• Mining at West Mandilla completed. A stockpile of approximately 51,000 tonnes,
expected to contain more than 12,000 ounces of gold, awaits processing.
• High grade bedrock intersections achieved at East Mandilla including
1m @ 14.58g/t Au
1m @ 9.23g/t Au
1m @ 13.98g/t Au
• Structures extending for two kilometres south-east from the East Mandilla bedrock
mineralised zone define large, untested, compelling exploration targets."

Do your own reasearch and reading as any sign of weakness tommorow I will be topping up.
Kind reg

 

[TheAbyss]

I think the bottom line of the report is that their producing mines are equal to or better than what we knew, they are producing enough cash to fund exploration in all projects plus we have an unknown quantity in East Mandilla. East Mandilla is a potential resource that they haven't had time to do enough work on to ascertain exactly what they have.

They have stated in two separate areas of the report that they have a potentially large resource.

1. " Structures extending for two kilometres south-east from the East Mandilla bedrock mineralised zone define large, untested, compelling exploration targets."

and from further within the report,

2. Importantly, a prominent linear structure can be seen on the magnetic image (Figure 2) extending south-easterly for
two kilometres from the known mineralised zones. Broadly, the known palaeochannel and
bedrock mineralisation occurs where this structure intersects the sheared western edge of the
Mandilla Granite, suggesting it may possibly be a key controlling structure. Areas of
demagnetisation along and adjacent to this structure to the southeast of the East Mandilla
mineralised zone are currently untested and represent compelling targets for exploration

Bottom line is that prior to RMS reporting their finds AAR were a great long term prospect, throw in the company making potential of East Mandilla my view is you cant go wrong as they do have a resource in East Mandilla it is just a matter of how much they have which may take a while to identify.

Is there a geologist in the house who would care to offer some unbiased thoughts on the statements within the report?

 

[jtb]

Good day to be sleeping today by the look of it
Exited this morning due to the apparent break in the upward trend.
Will re-enter when 9c is proven again as support.

 

[aaronphetamine]

Well yes Anglo was gang raped today, and that puts it nicely. There are some good bargains around now and AAR is one of em.. Im too scared to re enter any of them atm though, maybe in a few days.

seeing AAR below 11c makes me cry.

angelo how are you feeling champ ?

 

[Ang]

Well yes Anglo was gang raped today, and that puts it nicely. There are some good bargains around now and AAR is one of em.. Im too scared to re enter any of them atm though, maybe in a few days.

seeing AAR below 11c makes me cry.

angelo how are you feeling champ ?

I am feeling fine, just have to wait longer for the move up. Should see some volitility until the interest rate interst rate announcement next week. however will be ok in a couple of weeks.
kind reg
ang

 

[Bluesky]

I am feeling fine, just have to wait longer for the move up. Should see some volitility until the interest rate interst rate announcement next week. however will be ok in a couple of weeks.
kind reg
ang

You topped up at these bargains today Ang?
Or just waiting for lower prices?
A months time i think will start moving again up over 12c+.
Man did it take a beating today

 

[TheAbyss]

AAR showed some nice moves today (up 12% mid afternoon then closed at + 4%) before the friday afternoon sell off. Was it purely the science of nearology (RMS announcement today that additional resources had been identified) that brought about this increase today?

AAR went up nicely yesterday (14%) which was prior to RMS announcement today but then again the news could have leaked early.

Thoughts?

 

[cuttlefish]

RMS went into trading halt yesterday (thurs) - so knowledge that some news would be coming out of RMS was there on thurs. AAR Mandilla lease is about 2km due east of RMS Wattle Dam.

 

[aaronphetamine]

I did sell out of AAR on Friday for a bit of a loss, I set the sell at 9c and i was at work and really didnt expect it to reach that, but surprisingly it did, so im glad that it closed lower. Its seems like monday will be an up day for the all ords, and i dont have to work so it seems like a good day to do some day trades

Now that AAR dropped back to 8.5c it seems like it could be a good opportunity to buy some back and then sell again when it goes higher, as a newer trader, i started to realise at some point you just gotta sell a stock even if its a loss, just so you can use those funds to start making profits again.

So with RMS in a trading halt and an up day most likely tomorrow, i wonder where we could see AAR going ? maybe to the high 9s ?

Its been a bit quiet around here recently, i spose most of us got a bit disheartened by the big slide, but all the speccies were hit hard.

 

[cuttlefish]

So with RMS in a trading halt and an up day most likely tomorrow, i wonder where we could see AAR going ? maybe to the high 9s ?

RMS came out of trading halt on Friday (with news).

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[Ang]

Interesting technical analysis, it seems that a head and shoulder has formed and heading towards the 13.5 cents again. It is also intersting that it is following a head and shoulder patern like the AXO. The other lines that have crossed are the 8,21 moving average line.
Kind reg
ang

 

[Ang]

With the price of gold up on Friday night this should be good considering the Dow was down 280 points on Friday night. Has any one got news regarding what is happening in WA. a friend of mine said there is something big in WA happening with AAR. What resourses do they have in WA??
The chart looks good as a technical analysis, the 8,21 moving average has crossed and if you draw a line from the top to the low now, it seems it clossed above that line in Friday.
kind reg
ang01

 

[BUY&SELL]

News is due from all 3 of AAR's WA projects from any time now going forward to November.

Dalgaranga - 60km's northwest of Mt Magnet. Native title issues should all be put to bed by now and the follow-up program to investigate the amounts of uranium it has. Followup program was to be done during June quarter.

Feysville - Exploration on gold potential has been going on since oct/Dec 2006, updates on results even notices of mining must be on the way.

Koongie - updates on pfs, a work in progress up until production. This is AAR's baby. Due for further metallurgical results last Q. of 07.

Madilla - the one that got the markets eye (maybe due to RMS) Drilling & test work due on new areas of the project and all that gold going through processing.

So all in all it looks good for AAR over the next Quarter, and I think we may get a new web site(updated anyway)

 

[YOUNG_TRADER]

Hi guys,

Well with the Fed cut the other night, I think the Bulls will return in force, so Iam more and more willing to wade out into the investment waters again,

I was looking for a good gold stock in production and remembered AAR,

Its toll treating some good grade gold from its operation in W.A. called Mandilla, it should net $10m from this qtr's treatment of high grade stock piles,

It has about $5m in the bank and so will be well funded for further exploration and production work,

While Mandillia seems like a small cash cow, next door RMS (Ramelius) was running a similar Toll Treat operation at its Burbanks deposit, well they struck some very very high grade gold and it looks like what was once just a small cash cow for RMS has truned out to be the Jewel in its crown, so much so that RMS purchased the Mine that was Toll treating its ore and has now become an owner operator.


Given the fact that Mandilla is at most 2-5kms DIRECTLY East of RMS's Burbanks, it could be said that a "nearology" may be possible.


In any event, AAR's jewel in its crown is Koongie an open pittable Zinc Copper Lead Silver base metal VMS style project and while the Zn Eq grades are say only have that of the amazing Jaguar deposit owned bby JML, IT IS OPEN PITTABLE and about 4x AS LARGE, so when you consider this and the fact that JML has a mkt cap of $500m+ makes you realise the value of these VMS Base Metal deposits if they can be brought into production, its being undergoing Feasibility Studies and Metallurgical testing for the last few qtrs,


Bottom Line, with a record high (almost) Gold Price and good cash flows/profits form its Mandilla project, the possibility to find deeper high grade resources as RMS did and the ongoing development efforts at Koongie, AAR looks to be a very interesting story so I have been buying yesterday and today 8.5c - 9.5c

Cheers

p.s. proper analysis to follow tonight

 

[hangseng]

AAR have broken away from the recent tight trade channel.

Two solid candles upward with positive divergance on the MACD, DMI and on high volume. Chart looking excellent now.

Announcements will be due soon for the gold production which has been waiting in line for some time now. With the POG and high grades that have been achieved the cash to be generated can safely be expected to be very high. This added to the already flush bank account of AAR and Koongie Park nearing completion of the PFS.

Great to see AAR come back again. This time I would not be surprised if it simply doesn't just keep going up strongly and consistently. AAR exposure to Gold at present will surely have a positive impact with the POG rising so strongly and forecast to go a lot higher yet. Will provide very strong cash backing for the Koongie Park development.

 

[mick2006]

I certainly agree with YT in terms of the potential upside for AAR, management has been quietly going about business and improving the short,medium, and long term fundamentals of the company.

Short Term - the upcoming $10 million gold production profit from Mandilla, and would be expecting to hear some more news on the very exciting Koongie Copper/Zinc/Lead/Silver prospect (as YT points out several times larger than JML's flagship mine)

Medium Term - exploration results from around the Mandilla area (remember only a few kilometres from the massively high grade gold exploration results from RMS's Wattle Dam) also results of the feasibility study for the Koongie Project and if all goes to plan some extra cashflow from some more open pit, high margin, toll treated gold production from around Mandilla.

Longer Term - the real company maker first production from Koongie, and hopefully some deep high grade gold results from Mandilla.


also from a trader point of view AAR is in the sweet spot at the moment just below 10c, where a break above 10c would result in some nice % gains.

 

[tech/a]

Hmm I know a techie who also has been accumulating some.If there is anything interesting I'll post up a chart.
Might when I have time post technical chart and reason for taking trade.

 

[tech/a]

Bought this on the obvious breakout after a month of tight consolidation on low volume.
Breakout was strong with increased volume and the bar finishing near its highs.
In the short term this is at an interesting point.
Very high volume today with buyers seemingly filling all supply.
Will be looking for tight range days if it comes off a little.
Wide range down on volume will indicate plenty of supply.
Wide range down light volume will indicate no demand.
Once and if all supply has been absorbed then this could test recient highs.

Unlike some of you fundies if this looks weak I'll be out real quick and intraday.
I'm trading it on a 15 min tick chart.

 

[YOUNG_TRADER]

AAR​

Mkt Structure

Shares
500m



Mkt Cap @9c = $45m Current



Cash
$5m + $10m from upcoming treatment of stockpilled Ore


Projects


Mandilla Gold, 100%, W.A.

The first thing to be said about this project is that it is a cash cow type project, ie when it was put into production it was never meant to be a company maker, so far it has netted about $5m in profit and this qtr should see another $10m be netted from the treatment of high grade stockpiles.

The operation is a Toll Treatment agreement and appears to be quite profitable and the company has been able to use these funds to conduct further exploration at Mandilla, Mandilla East and Manidilla West and has been able to find more open pittable Gold,


"High grade bedrock intersections achieved at East Mandilla including
1m @ 14.58g/t Au
1m @ 9.23g/t Au
1m @ 13.98g/t Au
• Structures extending for two kilometres south-east from the East Mandilla bedrockmineralised zone define large, untested, compelling exploration targets.

The central core of the East Mandilla mineralisation contains high
grade mineralisation which may be mineable by open pit methods. Drilling to date is currently based on 50m spaced sections, which are considered to be too widely spaced to estimate mineable reserves. Geological consultancy BMGS will review the new drilling data andundertake a pit optimisation to determine if infill resource drilling is justified."


So the gold mining at Mandilla is by no means over, in fact in my opinion the best may be yet to come.

As I mention earlier on, Mandilla is actually 2-5kms East of RMS's Wattle Dam gold operation, a quick histroy lesson on RMS, shows that it too was developing its Wattle Dam gold mine as a simple cash cow project, ie it was never meant to be a company maker, however some deep holes below the base of the open pit operation intersected some amazing hits of gold

48m's@154g/t Au from 148m's down with 1m@1783g/t Au
Another hole intersected 13m's@31.6g/t Au from 150m's down

RMS's share price went from 40c to $2+ so the fully dilluted mkt cap went from $70m to $350m+, all in the space of a week or so and the companies once "cash cow" project, all of a sudden became its Jewel in its Crown.

So given the proximity of Manidilla to Wattle Dam (ie 2-5kms) and given the fact that in the past AAR has had the following drill intersections at Mandillia

a spectacular result of 3m @ 250.07g/t Au (inc. 1m @ 739.76g/t Au).
This exceptional intersection is accompanied by other significant intersections
such as 1m @ 13.2g/t Au, 1m @ 11.2g/t Au, 1m @ 10.17g/t Au and 1m @
6.7g/t Au at depths of only 16 to 19 metres below surface. 3m @ 71.82g/t Au (inc. 1m @191.75g/t Au),
2m @ 38.95g/t Au, 2m @ 9.15g/t Au and 1m @ 11.8g/t Au



And these were all shallow holes, I firmly believe the potential exists for deep drilling at Mandilla to uncover a possible high grade gold section that would transform Madilla into the Jewel of AAR's projects, as it did with Wattle Dam to RMS.

In any event, the cashflows generated for this project should ensure that for the foreseable exploration future no fund raisings (ie Dillution) will be required.



Koongie VMS style Base Metals, 100%, W.A.

JORC 4.7Mt's@ 5.2%Zn + 1.2%Cu + 0.8%Pb + 30g/tAg

This project is made up of 2 parts, 1 appears to be shallow enough to be open pittable, the other which appears to be the bulk would best be accessed via underground mining.

The company has been undertaking metallurgical testing as well as Pre-Feasibilty Studies on the project.

To highlight the value of these VMS style deposits, its worthwhile considering JML as an example,

JML has a mkt cap of over $500m and its principal asset is the Very High grade underground Jaguar VMS deposit, which has a JORC 1.7Mt's@ 11.3%Zn +3%Cu + 0.7%Pb +115g/tAg

To compare we can use Zinc Eq grades,
JML $500m+ 1.7Mt's@ 20%+ Zn Eq
AAR $45m 4.7Mt's@10% Zn Eq

Now obviously JML's project is in production now and thus there is very low development risk as opposed to AAR's etc etc, but the point I'm trying to make is not to compare the mkt cap's of the companies, but rather to show how valuable these VMS deposits can be if and when they are brought into production.

The company has been undergoing PFS studies for awhile now, so I would expect an update which if positive should lead to a full feasibilty study.


Victoria Downs Zinc/Lead Base Metals, 100%, W.A.

The project area contains several historical lead and zinc prospects. Previous dating indicates the Victoria-Birrindudu Basin rocks are the same age as all the Proterozoic basins which host Australia’s largest base metal resources. Previous exploration in the area primarily focused on diamond exploration located large areas where stream sediments are strongly anomalous in zinc and lead (up to 9% Pb and 0.75% Zn). The Company considers Victoria Downs represents an exciting early stage base metals exploration project.

Two Exploration Licences have now been granted. A reconnaissance program following up geological and stream sediment anomalies is planned for the September quarter.


Feysville Gold/Nickel, 100%, W.A.
The Feysville Project consists of all mineral rights attached to two mining leases located 16km SSE of Kalgoorlie. The project is situated in the geological / structural corridor, bounded by the Boulder Lefroy Fault that hosts the world class deposits of Kalgoorlie and St Ives as well as other substantial deposits in the New Celebration, Kambalda and Hannans
South areas. The project also contains an extensive strike length of an ultramafic unit which may correlate with the ultramafic horizon that hosts nickel sulphide deposits at Kambalda 30km to the south.



Pinnacles Gold, 40%, W.A.
The wholly owned exploration licence of 4 sub-blocks is located immediately east of the Pinnacle workings 20km east of Cue. The area is interpreted to contain portion of the felsic unit that hosts most of the mineralisation at the Tuckabianna mine. Alloy Resources Limited may earn a 60% interest by expenditure of $150,000 over a three year period.


Summary

- Chart wise 8c seems to a strong level of support
- It looks to be on a breakout, once 10c is cleared I expect a run to re-test the all time highs of 13c, if broken lookout!
- Mandilla should continue to generate cash, however also has the potential to turn into a Bonaza gold mine given what occured next door for RMS
- Koongie offers alot of upside if it can be brought into production, also VMS deposits rarely occur alone hence, good potential would exist to find more satelite deposits, however until development options ar eput forward on Koongie it must be classified as speculative
- Gold is at record highs