Okay, this company is now in Fat Prophets best picks for 2008 and also in the AFR top 20 for this year. Cockatoo Coal gets the big move from prophets recommendations.....this one goes down. Trust me to own this one...and bucket loads of them......
CRITERION hears faint but distinct rumblings on the resources bush telegraph about offshore interest in the West Australian mineral sands explorer involving some serious moolah.
The ambitious minnow (market cap $118 million) has posted upbeat drilling results at its Coljarloo tenements in WA's North Perth Basin, but aspires to win mineral sands dominance from Iluka Resources (market cap $860 million). Given Iluka's woes, maybe it's not such an unrealistic target.
But firstly, Image needs some serious dough from a deep-pocketed backer. Perhaps, just perhaps, the two Singaporean individuals who hold a collective 7-8 per cent of Image are an ideal source of some spare change.
Image chief George Sakalidis yesterday was keeping mum about the rumours, but was happy to discuss the string of Coljarloo results, which point to a world-class deposit.
Image's turf is only a boot's throw from the existing TiWest and Iluka mines. Not for the first time, Image has uncovered stuff on ground formerly owned by the majors, thanks to its customised aeromagnetic techniques. "We've had amazing results in areas where there are supposed to be no resources," Sakalidis says.
Image is spending a couple of hundred grand on 23,000 metres of aircore drilling across 19 targets at Coljarloo, over a strike length of 40km. What investors are really hanging out for is an imminent resources statement that screams: "We are sitting on a humungous deposit."
With 2100km of tenements, Image is the biggest holder in the mineral sands province. The region already supplies 25 per cent of the world's zircon requirements. Iluka is devoting its attention to its Murray basin and Eucla Basin projects.
Image also holds ground at the Eucla Basin, touted by some (but not all) as the future of the mineral sands industry.
Image's share price has been hovering around the $1.50-a-share ($118 million market cap) level, having peaked at $2.37 last July. Image unbundled its nickel interests into Emu Nickel, raising $10million. There are not many positive nickel vibes around, which explains why the 50c shares have tanked to 33.5c
Image's potential has been spruiked for some time, but we'll rate the company a speculative buy on the prospect of a sugar daddy helping Image to recast the sector in its own likeness.
While prices for zircon and titanium have been soaring on the back of unremitting Chinese demand, sentiment towards the sector has suffered because of Iluka's problems and because mineral sands has all the sex appeal of week-old roadkill.
Iluka has posted a dismal half-year result and warned that the appreciating currency would slash full-year earnings from last year's $51 million to $10-20 million. It's also facing rising costs to get its Murray Basin and Eucla Basin projects up and running and has flagged a $350million rights offer.
Criterion last rated Iluka a speculative buy at $4.50 in mid-December, on the grounds that things couldn't get much worse. Guess what? They did. But we'll stick with the speculative buy.
So let me get this straight, these guys are a mineral sands explorer due to release a JORC at some stage in the short term.
Their market cap is $100mill approx. Do they have any other projects to justify this MC? Or what is the target of the JORC to be defined? Apart from "world class" which surely isnt quantifiable.
This market is so strange. There are current mineral sands producers with MCs less than what their plant cost to build, and being cashflow positive
What a wealth of information you are grace. Have turned off the computer since the credit crunch began for fears of throwing myself off a cliff. Every time i get news from good o'l George i always check it out. George never lets me down, always makes me feel good about the price of the share regardless of its bearish trend.
I love the liquidity of this one, hardly ever over 100,000. Its off the radar for now, a little hidden gem in my portfolio. Sure its down from $2.20 in Nov 2007 to $1.20 in March (this is me not caring) while sellers attempt to fund their other margin positions. Let the markets falter, i see strong support at 1.20 for this baby. Also George's Superfund keeps buying in, supporting the price a bit with relatively small purchases.
If i had more liquidity id be buying bucket loads of this one.
Excited
836 holes for a total of 21,200m have now been drilled at Helene (including historical drilling). Of the 2,806 samples processed so far, 1,297 exceed a cut off of 2% HM (average grade 5.3%) and 126 exceed 10% (average grade 14.5%) with a highest grade of 36.9%. In total, 372 holes have intersections of 2% HM or more.
Resource estimation is being finalised on the Hyperion main strand and the Helene multiple strands at Cooljarloo North together with the 35AHD, 28,000 and Mid Level strands, and the channel mineralisation at Cooljarloo.
Results from 155 holes totalling 3910m of drilling since November 2007 have increased the cumulative strike length of the three main strands at Target 2 (now renamed Helene) to over 11km. Helene is now recognised to consist of multiple strands over a 4km distance with the three main strands averaging between 50m and 200m in width. Three subsidiary parallel strands have also been outlined (refer to map) making the zone of interest over 900m in width on the edge of the Gingin scarp.
Image Resources’ magnetic mapping technique was instrumental in locating the six strands identified to date at Helene. The northern extension of this wide zone is being followed up with a ground magnetic survey covering new tenement E70/3328 with follow up drilling planned upon completion of permitting.
Significantly, the larger heavy mineral (HM) deposits, including Eneabba, Cataby, Gingin and Reagans Ford,
all occur along the Gingin scarp.
Any Idea when the JORC report will be ready? Would love some good news that actually stimulated the price right about now.
And we have the trading halt. That announcement everyone was waiting for on Wednesday hopefully.
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