AEX - Acclaim Exploration

[nizar]

When would you expect drilling results ann?

By the end of May IMO

But hard to tell, could be delays, etc...

But similar follow up drilling by AGS took around 4 weeks....

Remember AEX started beginning of April, so end of May should be enough time...

 

[pharaoh]

Thanks Nizar

Oh, pls check out my question post in the Beginners Lounge if you get a moment, would be interested in your thoughts.

 

[nizar]

From my understanding, the drilling by AEX now is to convert the Inferred JORC resource into Indicated categories... is that right?

From your experience (any1), what are the risks involved?

Is there a high/low chance that the resource can be converted to the other category?

 

[rederob]

From my understanding, the drilling by AEX now is to convert the Inferred JORC resource into Indicated categories... is that right?

From your experience (any1), what are the risks involved?

Is there a high/low chance that the resource can be converted to the other category?

nizar
AEX need to establish "reserves" so they can develop a viable mine.
Reserves are defined as proven or probable categories, and are usually expressed with a "cut-off" grade.
The cut-off is usually set at what is financially viable to mine (and as prices rise for the mineral, the cut off grade can reduce).
The next step is look at what costs are attached to mining what is confidently discovered.
Lending institutions need the highest degree of confidence that what will be mined will give a return on the investment, thus we call this next step a Bankable Feasibility Study.
At this stage we will know how much more money is to be poured into the company, and the extent of inevitable share dilution.

 

[dingo37]

nizar
AEX need to establish "reserves" so they can develop a viable mine.
Reserves are defined as proven or probable categories, and are usually expressed with a "cut-off" grade.
The cut-off is usually set at what is financially viable to mine (and as prices rise for the mineral, the cut off grade can reduce).
The next step is look at what costs are attached to mining what is confidently discovered.
Lending institutions need the highest degree of confidence that what will be mined will give a return on the investment, thus we call this next step a Bankable Feasibility Study.
At this stage we will know how much more money is to be poured into the company, and the extent of inevitable share dilution.

hi rederob,

and the chart is showing it could be up for a bit of a trade as well.

regards dingo37

 

[kariba]

Hi guys:

From a mining guide:

Mineral Resources are subdivided, in order of increasing confidence in respect of geoscientific evidence, into Inferred, Indicated and Measured & Reserve categories.

1] Inferred Resource is a Resource which can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity.
2] Indicated Resource is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration and drill holes. That are spaced closely enough for continuity to be assumed.
3] Measured Resource is a Resource which can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity.
4] Probable & Proved Reserves is the economically mineable material derived from a Measured and/or Indicated Mineral Resource. It is inclusive of diluting materials and allows for losses that may occur when the material is mined. Appropriate assessments, which may include feasibility studies, have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction is reasonably justified.

AEX's immediate goal as stated on page 3 of the last announcement is to move to "indicated" and "measured" categories

The next step is to begin a scoping study & Pre-feasability study & then Bankable Feasability Study - As mentioned in description 4, it is during this process that the Probable & Proved Reserves are arrived at.

A "measured" resource will see AEX's shares rocket!!! They will at this time announce commencement of feasability studies that will put AEX on some serious radars!!

So lets get to that next step

cheers

 

[123enen]

Does this mean that AEX paid $6Million for a guess, inferred Resource having substantial uncertainty.

 

[nizar]

Does this mean that AEX paid $6Million for a guess, inferred Resource having substantial uncertainty.

I see where u are coming from, but $6million was a substantial % of their market cap at time of purchase, and they sold off their nickel projects to pursue DD, so Id say management is pretty confidence that DD will be a winner

 

[rederob]

Does this mean that AEX paid $6Million for a guess, inferred Resource having substantial uncertainty.

kariba
Thanks for the infill post - I tried to keep mine simple.

123enen
No.
The resource can be reasonably inferred to exist, but the certainty of its probable quantum and quality cannot be determined without significant additional drilling.
Infill drilling to known depth will give greater certainty, ie more holes in the same area but between the holes already drilled.
Sometimes such drilling indicates an extension of the target geology might be worth following as sophisticated computer graphics/3Dmapping is used and will give them a good idea of what they have.
AEX is, I believe, using the original geologist so they probably have a very good idea that they have something viable: The drilling results could be worth a fortune - or not!

 

[123enen]

Thanks for the answers.
BUT this is the one that really confuses me.
2.5M oz * US$450/oz (at the time of sale)
Why did the previous owners sell a US$1Billion gold resource for $6 million

I understand lack of interest in the U resource at the time - but that much gold. It doesn't make sense. This is my missing link even though I hold stock.

 

[kariba]

kariba
Thanks for the infill post - I tried to keep mine simple

No worries Rederob

It was just but your mention of "reserves" as the next step, is in fact way down the line - reserves are determined at FS & BFS stage.

So what Nizar had asked: From my understanding, the drilling by AEX now is to convert the Inferred JORC resource into Indicated categories... is that right? .... is correctly the next step.

I was not trying to be pedantic or anything, its just that upgrading the resource to "Indicated" wil be HUGE! It will be the step that grabs the attention of serious players, indicationf that DD is the "real deal."

Everything set in place for a very exciting next 12 months

regards

 

[kariba]

...this is the one that really confuses me.
2.5M oz * US$450/oz (at the time of sale)
Why did the previous owners sell a US$1Billion gold resource for $6 million

I understand lack of interest in the U resource at the time - but that much gold. It doesn't make sense. This is my missing link even though I hold stock.

Hi 123enen

We could ask many similar questions of other situations ie:

Why did Aztec sell LH to Paladin for the cost of a cut lunch?
Why did Rio hand over Sepon to OXR - for a wee bit more? :
Why did .....?

Then consider, $6 milion is a fair bit of money, even when dealing with big resource deposits. Then there is the royalty on the gold, and shares alloted etc.

Then think too, how much did Savanna pay for it - I reckon they got it for next to nothing. They did enough to get it to JORC inferred status & then did what they probably always intended to - sell it for a big profit.

I am realistic too! I am positive there will be a "disclaimer" to DD! It wont be a cakewalk to mine the resource! For example, a quote from one geo on the challenges associated this South African gold mining:

"Problems with the placer model for genesis of the Witwatersrand-style gold include the lack of Fe oxides but abundance of pyrite, unusual sulfides in the reefs, detrital transport of uraninite grains, the inference of hydraulic equivalence of reef minerals, and the source of the gold itself. Other features not predicted by the current placer model are mineralization in the immediate footwall of the reefs, apparent structural control of payshoot orientations, and basinwide chemical associations."

Lets face it - If it was easy to take 31.5m tonnes of U3O8 & 2.5moz of gold out of DD, they would have done it already!!! So what's changed? Why has the gold suddenly come into the equation? IMO, simply put: increased commodity prices! When AEX purchased DD, U3O8 was about US$25p/lb - Now: $41p/lb - Gold then:$420 p/oz - now: $600+! .....And both rising. What might have been marginally economical in early 2005, is now VERY much so, especially when one is mined as a by-product.

Caution is always warranted - but the picture looks very good IMO.

cheers

 

[123enen]

Hi Kariba,
Excellent. Thank you very much

 

[Fab]

Should I translate the above comments as AEX is a stock with a lot of possible prospect but really nothing to deliver at the moment. Which makes me think this is like having a punt on a company that can not deliver anything at this stage. A bit risky isn’t it ?

 

[Sean K]

Anything with 'Exploration' in the title is probably a little bit risky. Don't bet the house on it, but a little punt on this could have a big return.

I've been trading this stock for a while (since 1996!) and am excitied about the DD prospect.

The stock has recovered very well from historic lows of around 2.3c and has had some consistent volume pushing it up over the past 4 months. Recovered well from hic up in April and looks to be climbing again.

It's worth doing some reseach on this. Any good news out of DD could be great for the SP as there's a lot of people looking for the next viable PDN.

 

[Fab]

Thanks for your feedback. Then why do you believe AEX will be the next PDN ? I have to say at around 6 c it is quiet attractive to have a punt on it.
I am just a bit worry that I might have to sit on it for a long long time . Like you did I believe

 

[Sean K]

I'm not saying it could be the next PDN but that's what the market is chasing at the moment. Anyone who has a potentially massive resource of U3O8 in a country that actually lets you dig it up will draw huge interest.

If the inferred resource is proven, then I HOPE it could be something like PDN. Then, I will be able to pay off my credit card. And buy a yacht and sail around the world.

 

[Fab]

That’s my aim too
How long does it take to go throught the inferred resource process ? Any date when this should be done by ?

 

[Sean K]

They are drilling this quarter. So, news should come through any time in the next 3 months. Hopefully May!

Have a read of their last Quarterly Report dated 31 March for more info.

 

[MoMoney]

oppies cheap tommorow morning! excellent buy/hold, expire june08 @ 5c!!!!
if aex appoint experienced GEO, and confirms and upgrades known reserves at DD....Kk Boom!!!!!!!!