"That was the week that was... in Australia"

[drillinto]

July 22, 2007

That Was The Week That Was … In Australia

By Our Man In Oz
www.minesite.com/aus.html
[Note:The Editor of this website says that Our Man In Oz is "the authentic voice of Australia"]

Minews. Good morning Australia, it looks like corporate action dominated your week.

Oz. It was certainly one of the highlights. The other positive news was continued evidence of revival in the gold sector, while on the negative side there was concern about the damage being done to profit margins by the rising value of the Australian dollar, and signs of nervousness in the uranium sector.

Minews. Corporate stuff first, then the gold stocks please?

Oz. Kimberley Diamond (KIM) and Consolidated Minerals (CSM) took up most of the talking time about deals and takeovers, but there was also fresh interest in Oxiana (OXR) and its interest in a merger with Zinifex (ZFX), or plans to buy more left-overs from Rio Tinto (RIO) should it win control of Alcan. Neither Oxiana nor Zinifex did much during the week, Oxiana was down A8 cents (2 per cent) to A$3.83 and Zinifex was down A52 cents (2.5 per cent) to A$20.08.

With Kimberley, as you reported mid-week, Gem Diamonds finally came to the party with a bid pitched at A70 cents, which is comfortably above the low point to which the stock had sunk, but a long way short of last year’s high. On the market, after a two-day self-imposed suspension, Kimberley closed the week up A15 cents (28.5 per cent) at A67.5 cents, which leaves a curious gap between the market and the Gem offer price.

Minews. Is the market hinting at doubts about the Gem bid?

Oz. No. The A70 cents has already been paid for a 14.9 per cent stake in the stock. What the market seems to be saying is that there are Kimberley shareholders keen to quit the stock quickly even if it means taking a small haircut on the way out, and doing something else with their money. Of course, it might also be saying something about what Gem will find when it finally gets control of Kimberley which has been hurt quite badly by the rising dollar.

Minews. Aren’t all Australian miners caught in the same dilemma?

Oz. Most are, which is why you saw a definite slow down in enthusiasm for mining stocks over the past week. It was largely interest in situations such as Kimberley and Consolidated that maintained momentum. At Consolidated, the picture remains very confused with Pallinghurst and Territory Resources slugging it out for control of the manganese and chromite miner. On the market, Consolidated added A20 cents (6.1 per cent) to A$3.46, which is comfortably above Pallinghurst’s latest offer of A$3.30, but below Territory’s cash and share mix.

Minews. Perhaps best to sit on the sidelines and watch how that situation unfolds. Time for some of those gold prices you mentioned?

Oz. This is where we certainly saw a focus of interest as gold started to perform strongly against the U.S. dollar. Apex Minerals (AXM) which is playing a leading role as a consolidator of high-grade, but difficult, orebodies added A11 cents (11.2 per cent) to close the week at A$1.09, down slightly on the 12-month high of A$1.10 reached on Wednesday. Equigold (EQI), one of the often forgotten but very successful goldminers, also hit a 12-month high of A$2.31 on Friday, before closing at A$2.30, up A15 cents (7 per cent). Mundo Minerals (MUN) confirmed its status as a stock to watch with a fresh capital raising and commitment to a second mine in South America, joined in with its own 12-month high of A70 cents on Friday, before easing back sharply to A63 cents at the close, still ahead by A6 cents (10.7 per cent) at A63 cents.

Minews. Presumably this new found interest in gold was across the board?

Oz. Pretty much so. Allied Gold (ALD) which is making brisk progress with its new mine in Papua New Guinea was another to set a fresh high at A59 cents on Thursday, only to slip away at the close to A54 cents, still up A4 cents (8 per cent). Centamin Egypt was another at a 12-month high of A$1.39 on Friday before easing to close at A$1.34, up A10 cents (8 per cent), and Norton Gold Fields (NGF), the company which bought the big Paddington processing plant near Kalgoorlie earlier this year, joined in the record-setting spree with sales up to A34.5 cents on Wednesday, but also slipped at the close to end the week at A33 cents for a very impressive gain of A7 cents (27 per cent). The primary exceptions to the new rule of gold was Troy Resources (TRY), which is looking for a replacement to retired chief executive, Tommy McKeith. It lost A10 cents (3.8 per cent) to A$2.50.

Minews. A very interesting trend there, which should improve again next week after the strong afternoon rise in the gold price in London on Friday, long after you lot had wandered off to the pub.

Oz. Good point. Elsewhere on the market nickel, zinc, and copper stocks were mixed. Jubilee (JBM) added A36 cents (2.2 per cent) to A$16.91 after fresh nickel exploration news. Minara (MRE) lost A56 cents (7.4 per cent) to A$7.04. Kagara Zinc (KZL) was up A39 cents (6.1 per cent) to A$6.74 while CBH (CBH) lost A1 cent to A58.5 cents. Among the uranium stocks Uranex (UNX) slipped A5 cents (2.6 per cent) to A$1.86. Bannerman (BMN) fell A12 cents (4.4 per cent) to A$2.60, and Paladin (PDN) gained a very modest A1 cent to A$8.57 despite speculation of a takeover bid from Canada’s nickel giant, Cameco.

Minews. Thanks Oz.

 

[drillinto]

July 29, 2007

That Was The Week That Was … In Australia

By Our Man In Oz

Minews. Good morning Australia – or is it?

Oz. An interesting question after a roller-coaster week on the market, but on balance the answer is yes. Share price falls certainly outnumbered rises, and the overall metals and mining index was down 6.6 per cent. The indications are that next week will start in the same gloomy mood.

However, the issue really is how much of what we saw last week was caused by events which have nothing whatsoever to do with mining and commodity demand in China, and everything to do with tightening U.S. credit markets and a rapid withdrawal of hot money.

In Australia, the fundamental driving force of meeting the demands of fast-growing Asian markets has not changed, and do not look like changing for years, if not decades – a point highlighted by the fact that during last week’s correction could be a found a surprising number of stocks rising.

Minews. Let’s have the good news first.

Oz. Consolidated Minerals (CSM) was the star of the week thanks to speculation of a third bidder entering the battle for control of the manganese miner. On Friday, while all around were losing their heads, ConsMin added A36 cents (10 per cent) to close at a 12-month high of A$3.96. Over the course of the week ConsMin added A50 cents (14.5 per cent). There’s no identity yet for the possible third bidder but it has been suggested that a Russian metals group might be about to join the tussle between Pallinghurst Resources and Territory Resources which have competing bids on the tables. While ConsMin was rising, Territory was falling, losing A12 cents (11.7 per cent) to A$1.02, presumably because it could either get knocked out of the race, or because any counter bid will involve a promise of issuing more shares.

Minews. Keep an eye on that situation. The price seems to getting very high for a relatively small business.

Oz. Point taken. As was mentioned ConsMin wasn’t alone in the good news department. Other stocks to swim against the tide came from the iron ore, gold and speciality metals sectors.

At least three of the small iron ore stocks performed strongly. Grange (GRR) fought its way to a 12-month high of A$2.75 on Thursday, before easing to close the week at A$2.60, which was still up A22 cents (9.3 per cent). Sundance (SDL) announced a big capital raising for its iron ore project in Africa and still managed to replicate Grange by also hitting a 12-month high on Thursday of A57.5 cents, and then running out of puff on Friday to close the week at A51 cents, for a gain of A6 cents (13.3 per cent). The third iron ore record setter was a new player in the game, Ferraus (FRS) which announced good drilling results from a project in Western Australia, and promptly rushed up to A$1.17 on Thursday, before easing to end the week at A$1.06, for a rise of A12 cents (12.7 per cent).

Minews. Take us through the rest of the good news, and then a snapshot of the bad news.

Oz. Among the gold stocks, the biggest of the local producers, Newcrest (NCM) added a modest A16 cents (0.6 per cent) to A$24.75, though at one stage early in the week traded up to A$26.55. Dominion Mining (DOM) surprised the market with excellent results from its Challenger mine in South Australia, and gained A36 cents (14.2 per cent) to A$2.90, down a fraction on its 12-month high of A$2.96 reached on Thursday.

Among the speciality metal miners the emerging tungsten producer, Vital Metals (VML) moved up an impressive A13 cents (18 per cent) to A85 cents, and the vanadium producer, Precious Metals Australia (PMA) added A9c cents (4 per cent) to A$2.29. Significantly, both metals, vanadium and tungsten, are used by the steel industry which is the same power behind the iron ore miners. It was also an Asian steel mill which produced a winner in the coal sector with Cockatoo Coal (COK) stitching up a deal with Koreas Posco group and adding A10 cents (27 per cent) to A47 cents.

Minews. But it seems the steel industry couldn’t produce any winners among the nickel stocks.

Oz. No. Nickel remained under pressure. Losers included Jubilee (JBM) down A$1.66 (9.8 per cent) to A$15.25. Western Areas (WSA), down A25 cents (4.9 per cent) to A$4.80, and Mincor (MCR), down a very painful A72 cents (16.9 per cent) to A$3.53. There were also some iron ore stocks which paid a hefty price for getting a bit too far ahead. The biggest loser there was Fortescue Metals (FMG) which dropped A$6.95 (17.7 per cent) to A$32.15. Atlas Iron (AGO) was another to hit by sellers, sliding A11 cents (5.9 per cent) to A$1.76.

Elsewhere, it was largely one way, downhill, traffic. Among the zinc stocks, Kagara (KZL) fell A29 cents (4.4 per cent) to A$6.37, Zinifex (ZFX) lost A98 cents (4.8 per cent) to A$19.10, and CBH (CBH) managed to virtually defy the trend by holding steady at A58 cents. Uranium stocks were uniformly down. Marathon (MTN) lost A54 cents (9 per cent) to A$5.43, Toro (TOE) lost A5 cents (5.5 per cent) to A85 cents, and Uranex (UNX), which we might take a closer look at next week, fell A19 cents (10.2 per cent) to A$1.67.

Minews. Thanks Oz.

 

[acooper]

I have invested in a small Company in Outback Queensland that are Using Clean Coal technology to supply Clean Diesel.
i invested in the Company in 13-12-2006 at 18c per share and now is 79c per share which is a profit of 338.89% I haven't found any uranium shares that are doing the same if so please let me know which ones are growing because i love making profits instead of losses.
acooper

 

[BIG BWACULL]

I have invested in a small Company in Outback Queensland that are Using Clean Coal technology to supply Clean Diesel.
i invested in the Company in 13-12-2006 at 18c per share and now is 79c per share which is a profit of 338.89% I haven't found any uranium shares that are doing the same if so please let me know which ones are growing because i love making profits instead of losses.
acooper

Not Bad for one week Who uses "Clean Coal" technology to make Diesel
Can I/we have a ticker code, Should be intereting to research CHEERS

 

[drillinto]

August 05, 2007

That Was The Week That Was … In Australia
www.minesite.com/aus.html
[Free Registration]

By Our Man In Oz

Minews. Good morning Australia, another tough week?

Oz. A bit rocky, but that’s the nature of these corrections. Next week looks like we’ll get more of the same after New York’s last minute slide on Friday. The really interesting aspect for the mining sector is how the 1800 souls gathering in Kalgoorlie for the annual Diggers and Dealers gabfest will react to the tricky times we’re passing through.

Minews. An interesting thought. Perhaps you’ll see more people on Blackberries checking share prices than listening to the speakers.

Oz. Precisely. It’s become the way of all of these over-sized conferences with too many speakers. No-one actually listens to the presentations, it’s all about being seen while trying to run a business on the side.

Minews. Enough of that, how about some prices?

Oz. Thought you’d never ask. Or, more accurately, hoped you’d never ask because it’s been very hard to find much good news in a week of red ink. However, to bring a little cheer before reciting the list of the fallen let’s start with the few glimmers of good news, starting with a handful of gold stocks.

Troy Resources (TRY) which you reported on mid-week rewarded its shareholders with a solid A32 cent (13.3 per cent) increase to A$2.73, with A13 cents of that increase coming on Friday alone and taking the stock back to its mid-June levels. Troy boss, John Jones, isn’t listed as one of the speakers at Diggers but he is planning to drive back from Perth to his hometown of Kalgoorlie on Sunday and will be permanent feature somewhere around the conference.

A couple of other gold stocks performed well, and certainly better than the somewhat shell-shocked base metal and uranium sectors. Kingsgate (KCN) shrugged off the gloom to post a A10c (2.1 per cent) gain over the week to close at A$4.80, though at one stage the stock was trading as high as A$5.15. Dominion (DOM) was off A2 cents (0.5 per cent) at A$2.88, but did set a 12-month high of A$2.98 on Monday thanks to excellent results from its Challenger goldmine. Gold-sector leader Newcrest (NCM) was up A25 cents (1 per cent) to close at exactly A$25, with Friday trade particularly strong as the stock added A63 cents to more than make up a mid-week slump.

Minews. Other than gold stocks what else performed well?

Oz. Some of the small iron ore stocks managed to post gains. Mt Gibson (MGX) welcomed a positive environmental decision over its mine plans and added A10 cents (7 per cent) to A$1.53. Sphere Investments (SPH) rose A14 cents (4 per cent) to A$3.64 after announcing a deal with a group of Saudi investors. Giralia (GIR), announced good assay results and added A3 cents (4.3 per cent) to A72 cents, and Atlas Iron, despite the generally downbeat mood in the market appears to have successfully raised A$85 million to expand its operations. The shares went into a trading halt at A$1.68 on Monday and start trading again on Monday.

Minews. That’s enough cheering up with the good news. Time for the bad.

Oz. Well, there’s plenty of that, including a slide in the price of the local sector’s most interesting stock, Consolidated Minerals (CSM). Despite the intervention of a mystery Ukrainian investor the stock slipped A17 cents (4.2 per cent) to A$3.79. However, you would have to say the market on ConsMin is very confused because Friday trade actually saw the stock post a gain of A14 cents. Monday might see some light thrown on the situation as ConsMin is listed as the third speaker on the opening morning of Diggers.

Going through the sectors we saw most nickel stocks lose ground. Jubilee (JBM) slipped by A75 cents (5 per cent) to A$14.50 despite an encouraging uptick of A30 cents on Friday. Mincor (MCR) performed in a similar fashion, losing A9 cents (2.5 per cent) to A$3.44 over the week, but actually gaining A24 cents on Friday, with that last minute rise giving you an idea of how far the stock fell midweek, down to A$3.04 on Thursday. Western Areas (WSA) was all over the shop, losing a modest A7 cents (1.5 per cent) to A$4.73, but oscillating during the week between a high of A$5 on Tuesday, and a low of A$4.30 on Thursday.

Most uranium stocks lost ground. Uranex (UNX) was off A7 cents (4 per cent) to A$1.60 despite continued interest in its Bahi exploration project in Tanzania. Marathon (MTN) lost A32 cents (5.9 per cent) to A$5.11, though it was another stock to suffer extreme mid-week movement, dipping as low as A$4.76 on Wednesday before recovering on Thursday and Friday. Uran (URA), which we might take a closer look at soon, was off A6 cents (16 per cent) to A31.5 cents.

Copper and zinc stocks were generally down, with a few exceptions. Kagara (KZL) reported encouraging assays from its highly ambitious Admiral Bay zinc project, but lost A42 cents (6.6 per cent) to A$5.95. Zinifex (ZFX) slipped a modest A11 cents (0.5 per cent) to A18.99, while CBH (CBH) went against the trend with a gain of A2.5 cents (4.2 per cent) to A61 cents. Equinox (EQN) was another to swim against the tide with a rise of A15 cents (3.5 per cent) to A4.46.

Minews. Thanks Oz. We’ll watch out for news from Diggers and Dealers conference in Kalgoorlie.

 

[drillinto]

August 06, 2007

A Private Investor’s First Impressions Of Diggers ‘n’ Dealers
By Susie Boeckmann
[www.minesite.com/aus.html]

Little did I think that when planning to attend the Diggers ‘n’ Dealers Conference in Kalgoorlie as a private investor, I would be invited by a well respected contributor to Minesite to prune his roses in Perth before taking the short flight onwards. Not my strongest point but maybe an appropriate metaphor relating to the resource sector at this time.

Friday
Sunny warm day after a couple of weeks of much needed rain which has replenished dams and reservoirs. New water desalination/treatment plant coming on stream at Kwinana, 40 kms south of Perth, providing drinking water for Perth residents. Lots of press about this but no mention of Suez, who built it and will maintain it. A good feeling of hustle and bustle and everyone talking about Diggers ‘n’ Dealers.

Met with a top broker - Sandy Wylie of Pattersons - at the top of a splendid skyscraper, 2 The Esplanade. He was very cautious and basically advised taking profits, especially in small companies for the time being until the banking/subprime position becomes clearer. Still fairly convinced of resource strength in the long term. No surprises there. Big fan of Andrew Forrest, Fortescue Metals.

Accosted George Jones, walking at a fast pace on his way to chair a charity committee, very chipper and upbeat about plans for Gindalbie Metals. (I am a happy shareholder.) I didn’t mention that Wylie had advised selling Gindalbie.

Passed ‘Black Toms’ the miner’s pub, a couple of times, overflowing with mainly men talking mining; wished I knew who all the main players were. Had dinner with a couple of young guys who floated an exploration company called Jutt Holdings raising A$4million in April 2007. I wish them luck but there’s a dotcom/top of the market situation if ever there was one!

Several mining directors have expressed their dissatisfaction with the AIM market and seem to favour Canada as having more liquidity and a much better mindset for raising funds.

Saturday
Picked up by Tim at 12.00 from Duxton and drove to his home in Cottesloe for lunch and rose pruning with Ann. Lots of tips/guidance and names to watch out for – a veritable mine of information! Walked past Andrew Forrest’s house – not popular with the neighbours as he cut down wonderful old pines. Also barbed wire and lots of security in a laid back residential spot.

Sunday
Gorgeous weather. Morning flight from Perth to ‘Kal’. Couldn’t believe how many holes there are in the ground all over the terrain. Met by Read Corporate who had kindly let me share in a house which turned out to be brand new and pretty swish. On to the media centre to claim a good corner and then a quick tour round the booths to see who was presenting. Friendly but tight security called me a taxi to go to the Kalgoorlie Races sponsored by Southern Cross Equities.

The main host was Richard Granger who described the current market as ‘a drop in cabin pressure’. Talked at length with Gerard Farley of Finlay and Co and director of Central Rand Gold. My race card read a bit like my investment list; the Metex Maiden, Reed Resources Handicap – Chris Reed told me that he came from four generations of miners and horse breeders, His father and brother had horses racing today. Not sure about the company and the horses didn’t win!

Next the Apex Maiden Stakes. I am a shareholder and had sent an email to the managing director, Michael Ashley, to ask if Apex were doing any other additional presentations. He replied by sending me a ticket for the races. Considers his shareholders! They seem to be in a good position and have just successfully completed a large fundraising so are motoring away with their recent gold acquisitions. Most of their personnel are ex Lionore – it felt like a well focussed and confident team.

Next race was the Gindalbie Metals Handicap; followed by the Metals X Nickel Tin Cup Handicap. Peter Cook (managing director) and Warren Hallam (executive director) talked at length and will soon be making some announcements. I asked why tin was now important again. Use of tin has risen from 250 tons 3 years ago to 360 tons today and they expect the metal price to rise to US$20,000 per ton by end of year. Big growth in soldering for mobile phones, computers, other electrical equipment and fire retardant brake pads, as many countries become lead free. Also increased use for cans especially in Europe. Growth in mixture with other metals to avoid corrosion.

The CBH Resources Dig Handicap came next – Bob Besley and Jim Wall on good form. This was followed by the Jubilee Nickel Handicap where I met Kingsgate Consolidated Ross Smyth Kirk and Gavin Thomas. Pure gold play. They had flown from Sydney, spent the night at Broken Hill, arriving at Kal in a Constellation – sounds like the only way to fly!

Joined by Avoca Resources managing director Rohan Williams, we all walked to Hannon Street as no taxis and they dropped me off at the Hannon Club for the Consolidated Minerals dinner. About 100 people attended. Sat next to David Brooks who has just joined as investor relations manager. Completely new company with many changes of management. Rod Baxter gave a witty speech referring to the takeover activity – good for shareholders and board.

Also said that he thought Belize was in South America until he discovered that this one was in Ukraine. Privat now has 13.5 per cent of Cons Min and has not revealed its hand – could even be a third party in the bidding as they have a blocking stake. Baxter stressed that although both Pallinghurst and Territory had tabled bids, the board is open at this point to any other offer. Refrained from standing up and pointing out that it had not been exactly helpful to Territory.

Also met Julian McCormack of Credit Suisse (Australia) Ltd – showed obvious concerns of market and ‘fear of contagion factor’. Andrew Richard of Merrill Lynch Sydney, a gold and resource analyst, was also there. Generally analysts and brokers seem cautious but see good opportunities in a couple of months.

Left the party with Jim Reagan of Reuters Sydney who is staying in same house and called it a night. Everyone else went off to the Palace Hotel where Kingsgate gave out flashing buttons which apparently ended up on the ‘skimpies’ without much else. One pub is apparently advertising outside on a board that they have ten skimpies– last year they only had six. Sign of the times.

 

[drillinto]

August 08, 2007

A Private Investor Works Her Way Round Booths, Talks And Entertainment At D’n’D

By Susie Boeckmann
www.minesite.com/aus.html

Tuesday

Very full day today with eight companies having 15 minutes only and fifteen presenting in all. 8.30am kick off with Barrick.Gold. Usual question – what is the hedge book position – US$400 million. Followed by confident presentation by Vulcan Resources managing director Alistair Cowden and chairman Barry Eldridge which has just additionally listed in Norway. They have just completed a fundraising to raise A$52 million so are ‘happy and unconstrained by money’. He described Finland as being like Kalgoorlie but with snow. All the base metals plus platinum. No political risk in Finland and very business friendly – reckons his company should be ‘at a premium against other business environments’.

Monarch had its first gold pour at Davyhurst yesterday and had some great photos. Michael Kiernan started the presentation with a film of past gold mining clips and the song ‘Those were the days’. Very atmospheric. ‘Hopes the tail wags the dog’ and his project at Minjar goes into production next month. Obvious questions about Cons Min situation. He has written a very strong letter to Cons Min shareholders from Territory Resources attacking Pallinghurst’s previous bid as ‘ complex and inadequate’ and restating his superior offer backed by an independent valuation by BDO Consultants and reinforced by the A$225 million equity commitments from Noble Group, DCM, DECOmetal and Lehman Brothers at A$1 per Territory share…… .

General talk afterwards regarding Monarch was described by a senior analyst as an ‘impissibility’. (spelling correct).

Jabiru’s Scott Donaldson emphasised that he had taken the company from A$60million two years ago to a market cap of A$600million today. Went to Ausdrill’s stand and talked with Ron Sayers (All big strong men!). They had an offer last May but there has been no news since. Hopefully in a month to six weeks: but they have a full order book and doing well.

Bendigo’s booth.was well attended but from a market cap a year ago of A$1.3 billion they are now capitalised at A$150million with A$10million in the bank. Share price of 30c is backed by 14c cash. Since their downgrade on 8th January they now have a new plant ready to go and have completely changed their exploration strategy. They are confident that they will find the ‘veins’ again as Bendigo is the second largest historic gold area after Kalgoorlie and produced gold from 1841 – 1954. Described as a good option play.

Sally Malay Mining had a good reception and were strongly recommended by KPMG in Perth (along with Zinifex).Interesting presentation from Gareth Dixon of Gindalbie but there still seems to be scepticism about the new rail link which would not be finished for many years and has been talked about for fifteen. But share price has been excellent over the past few months.

Another gold company that has not been talked of much in London, apart from an article on Minesite, although has US following is Citigold (ASX: CTO) First gold company to list on Dubai exchange. They are producing from Charters Tower which was discovered in 1871 and traditionally produced gold from 1898 -1916. (During Charters Tower Goldfield’s first 40 years, 130 mines produced a historic 200 tons of gold at a depth of not more than 700 metres). Bad years after as first world war took all their fuel (trees): the workers’ compensation act and wages greatly increased costs. People also sold their gold shares which had paid good dividends and patriotically bought Government bonds which plunged and paid no dividends.

Managing director Chris Towsey now has a 30 year plan in place and Citigold’s corporate goals include developing several mines and an annual production of 250,000 ounces. The cost is budgeted at below US$320 per ounce. Warrior is the first mine which started producing in November 2006 and will eventually reach 100,000 ozs.

Independence Group also had a full turnout. Analysts and successful institutional broker from Sydney seem keen on this company and saw the recent share price retraction to A$6 from A$9 as a strong buying opportunity. (Good dividend stream).Said to be one of the cheapest nickel sulphide producers in Australia, producing 9,000 tonnes/year. Are in a JV with Anglo America Ashanti at Tropicana, south of Perth. Also have a greenstone belt described as under ‘a farmers paddock’ at Pithara. Mentioned that it is a very civilised area as lots of pubs!

Could mention lots of other companies but decided to call it a day as have been invited along with other press to go up in the ‘Connie’ (Constellation aircraft) by the sponsors who are Kingsgate, Nautilus Minerals and CBH Resources. Great roomy aircraft lovingly cared for by a group out at Albion Park at Woolagong, who are mostly ex Qantas pilots and engineers.

Takes half an hour to get engines going and flames come out on the wing. Quite quiet and we could walk around with drinks and snacks but the most amazing experience was flying over the Super Pit gold mine which has been producing for over 100 years and still an enormous undertaking. Seeing it at night with all the lights on it and dozens of trucks moving earth was extraordinary. Truly magnificent. Also flying over Kalgoorlie lit up – all at just 1600 feet -was amazing.

We had a party on the plane on landing and then headed for the Palace Hotel which was throbbing and packed. Girls are very expensive and running around with glass vases, accepting large amounts of money to do kind of strip tease but actually quite tame (Maybe it was too early).

Continued on to the Exchange which was also heaving with happy revellers. Downstairs there was a covered white sheeted tent in one corner – leave the rest to your imagination. Charming Kingsgate guys poured me into a taxi….

 

[Boyou]

Great reading ,drillinto.

The author must be a pretty substantial shareholder to get her legs in the door at these amazing events! Or maybe it is her Legs that are substantial??

Perhaps she is Minesites "Man in OZ"
She writes very well and has some savvy .I think

 

[drillinto]

Great reading ,drillinto.

The author must be a pretty substantial shareholder to get her legs in the door at these amazing events! Or maybe it is her Legs that are substantial??

Perhaps she is Minesites "Man in OZ"
She writes very well and has some savvy .I think

Boyou: Yes, Susie Boeckmann writes very well. On her piece of August 6, she gives a hint(paragraphs 1 and 7) about the name behind "Our Man In OZ". It is most probably Tim Treadgold.

 

[drillinto]

August 10, 2007

A Private Investor Makes It To The End Of Diggers ‘n’ Dealers 2007
By Susie Boeckmann
[ www.minesite.com/aus.html][/url ] ...ards joined long and cold line for taxi home.

 

[drillinto]

August 12, 2007

That Was The Week That Was … In Australia
[ www.minesite.com/aus.html ]

By Our Man In Oz

Minews. Good morning Australia, another interesting week?

Oz. You could say that, though it really should be seen as a series of five separate daily events rather than a coherent and consistent week of trading. Business among the miners was undoubtedly affected by the fear and greed flowing through the financial sector but the overall result was perhaps better than most casual observers would expect.

Minews. You’re saying it wasn’t a correction?

Oz. It was that, but not a major correction. Overall, the Australian mining market, as measured by the Metals and Mining index on the ASX, was down 4.8 per cent over the week, but all of that occurred on Friday when the index plunged by 241 points, or 5.2 per cent. Wednesday and Thursday were actually “up” days, and you would have to say that next week looks like it might get off to a reasonable start after New York calmed a little on Friday.

Minews. The market certainly gave delegates at your annual Diggers and Dealers forum plenty to talk about?

Oz. True. But, rather than go back over the ground which was so excellently covered by your roving correspondent and active investor, Susie Boeckmann, let’s go through some prices to demonstrate how the week really evolved starting with a surprise – a selection of stocks which actually rose. There weren’t a lot, but the fact that there were any is news in itself.

Leading the pack of contrarian stocks was the unstoppable Andrew Forrest and his Fortescue Metals Group (FMG). It started the week on a seriously weak note, dropping to A$28 on Monday, which was the first time the stock has been below A$30 since early May, and is a country mile short of the A$40 FMG was fetching as recently as July 20, just 15 trading days ago. However, as the week rolled on FMG shrugged off the gloom, peaking on Thursday at A$33.50, being hit by the Friday sell-off to close at A$31.29, which was still up, only just A39 cents (1.3 per cent), but up nevertheless.

Some of the smaller iron ore stocks shared in Fortescue’s positive light. Atlas (AGO) was a bit of a star, rising A7 cents (4.6 per cent) to A$1.58, but that modest move should be seen alongside where the stock was mid-week, trading as high as A$1.81 which means you might also read the Atlas share price as falling A23 cents (12.7 per cent) from that Thursday high. Cape Lambert (CFE) also had a strong Thursday, reaching A57 cents before giving it all up on Friday to end the week at A52 cents, down A1.5 cents (2.8 per cent).

Minews. Take us through any other stocks to defy the trend, and then the bad news, please?

Oz. The sector to hold up better than most, as might be expected in a crisis, was gold, and that’s the area with the greatest concentration of stocks which rose, albeit modestly in most cases. Kingsgate (KCN) led the way with a rise of A15 cents (3.1 per cent) to A$5.05. Like most stocks it was hammered in the Friday sell-off, but not hard enough to undo all of the mid-week good work which followed an upbeat presentation at the Diggers forum. On Thursday, Kingsgate traded as high as A$5.51. Resolute (RSG) was another gold stock to defy the downward trend, adding A2 cents (1.3 per cent) to close the week at A$1.53, down on the Thursday peak of A$1.58. Tanami (TAM) was a third gold to creep higher, albeit by a lowly A1 cent to A14 cents.

Other stocks to post modest price increases included the specialist vanadium producer, Precious Metals Australia (PMA) which added A5 cents (2.5 per cent) to A$2.05, and the Scandinavian-focused base metals miner, Vulcan (VCN), which rose A3 cents (7.7 per cent) to A42 cents, but was as high as A46.5 cents midweek.

Minews. Time now for the bad news.

Oz. OK. Perhaps an interesting way to look at that week is to conduct a partial roll call of Minesite subscriber companies, starting with the gold stocks which did not do as well as the three mentioned earlier. Adamus (ADU) eased A1 cents (1.8 per cent) to A53 cents, in very thin trade. Apex (AXM) lost A9 cents (8.9 per cent) to A92 cents. Centamin (CNT) fell A7 cents (5.3 per cent) to A$1.26, but did get as high as A$1.33 midweek. Monarch (MON) lost half-a-cent to A29.5 cents. Perseus (PRU) was off A19 cents (16 per cent) to A$1. and Troy (TRY) slipped A6 cents (2 per cent) to A$2.63, but did get as high as A$2.69 on Friday, and actually gained A2 cents in Friday trade, which was a solid effort when everyone else was losing their heads.

Among the base metal stocks it was pretty grim news. Sticking to Minesite subscribers the call of the card looks like this: Aim Resources(AIM) was down A2 cents (6.9 per cent) to A27 cents. CBH (CBH) lost A7 cents (11 per cent) to A54 cents, but did trade around A60 cents for most of the week. Consolidated Minerals (CSM) lost its takeover shine, shedding A38 cents (10 per cent) to A$3.41 after Territory Resources (TTY) failed to launch a revised bid, and Territory itself was hit hard, losing A18 cents (18 per cent) to A80 cents. Mincor (MCR) was caught by the falling nickel price, dropping A30 cents (8.7 per cent) to A$3.14, Vital Metals (VML) lost A11 cents (12.5 per cent) to A77 cents, and Oxiana (OXR) fell A18 cents (4.9 per cent) to A$3.48.

Uranium stocks, as you would expect, were weaker thanks to the general market sell-off and the US$10 a pound fall in the uranium price. Uranex (UNX) dropped A22 cents (13.7 per cent) to A$1.38. Marathon (MTN) was hit hard with a drop of A$1.06 (20.7 per cent) to A$4.05, and Equinox (EQN) which is emerging as both a copper and uranium play fell A66 cents (14.7 per cent) to A$3.80.

Minews. Thanks Oz. Talk to you next week.

 

[drillinto]

August 13, 2007

A Private Investor Looks Back On Diggers ‘n’ Dealers With Affection

By Susie Boeckmann
[ www.minesite.com/aus.html ]

Wanted to see a little more of the area of Kalgoorlie so drove out to the Super Pit with Lynne Persall, whose ancestor (Findlater) had been one of the three pegging the original claim on finding gold in Kalgoorlie in 1897. Paddy Hannan is the one remembered by a statue that is now in the Town Hall as he actually registered and signed the ‘claim’.
The size of the Super Pit has to be seen to be believed with terraces and snaking dirt tracks as far as the eye can see with heavy earthmovers and diggers winding around in every direction in a cloud of greyish/green dusty activity. Now operated by Barrick and Newmont. They will soon be going deeper than the 700 metres to date but there is always a danger as in the past as there were over 100 small prospectors working at any one time and the area is riddled with tunnels and old workings which can cause cave-ins and rock falls. If one prospector hit a good patch the next door miner would often try to tunnel into his area to profit too!

On to the Mining Hall of Fame which demonstrates the History of Kalgoorlie, with a good array of old mining equipment and the way miners existed in the past. Also shows how gold is poured (but only a replica). Must find a local mine to show you the real stuff! Good collection of nuggets and rocks. You can also go down a working pit. Back into town via Williamstown – bit of an eyesore as full of battered corrugated iron houses. Residents can only rent and not buy there. Astonishing to see a herd of alpaca. Apparently there are lots of alpaca and llama being bred in WA.

On to the Boulder/Kalgoorlie Mine Museum at the top of Hannan Street which is fascinating and shows a full aspect of the history of the evolvement of Kal’s mining. Just time for a coffee at the Dome which is the most frequented coffee venue. Now very subdued and mainly occupied by locals dissecting the impact of 1,700 strangers in their town. They seemed to enjoy it and the party atmosphere it brings.

As there is a shortage of accommodation many of them had moved in with friends and let their houses. Even top mining executives had rented ‘winnibagos’ (motor caravans) and stayed in caravan parks which were really basic. There was not a hotel room to be found at any price. As for booking next year most hotels will not commit on price and only take an ‘expression of interest’.

Time for the airport. A long line of very tired looking people carrying ‘Diggers and Dealers’ wheelie bags (me included and very proud of my trophy). One man passed out completely at the Quantas counter. Another tripped outside and hit his head on concrete and was carried off in an ambulance.

Again extraordinary sight flying over the reddish/brown mining area, covered with pits working or not. No trees for over a 30 mile radius as had long ago been used for fuel or building – the environmentalists would stand no chance here of re-instituting forest and foliage.

Arrived in Perth and checked into the tax office (now the Duxton Hotel). Many told me that they still had nightmares staying there thinking of their tax returns. Visited the ‘club floor’ hospitality area to have a glass to be greeted ‘hey you’ve come from Diggers’ and the party began again!

One man told me that he had worked 10 years on the same mine but it had changed names 8 times – not an unusual event if the Kalgoorlie area. Ended up talking ‘Shortie’ of Aggreko who has been involved with building plants all over the world. They have just signed a huge contract in China. I had met him on the Ausdrill stand and he filled me in on all sorts of local lore. To quote – ‘It’s more incestuous than any sheep station re deals and holes in the ground’.

To summarise I would say that D’n’D was a unique venue where open networking and all over friendliness shone through. For me it was Australians at their best – open to ideas. Pragmatic about success and failures but always willing to get up and go. The current stars of the success stories were approachable to all. All thanks go to the organisation for what appeared to be a smooth, efficient, secure and very well run forum. The media room was excellent (and a haven of peace) with instant press releases given out and space to spread and work with the latest technology.

Presentations shown live from the auditorium and press interviews available immediately after each company’s pitch. As a newcomer everyone was helpful and welcoming. Certainly Minesite opened many doors and I am grateful for the tips and pointers given in London and Australia beforehand.

A few other points are that many companies are now concentrating on paying dividends to shareholders and even some of the mid tier companies are planning buy backs. Some are well funded so will continue in spite of the current volatility.

There seemed a greater emphasis and better understanding of Asian markets than in Europe. It is certainly boom time in WA and any current drop in share prices in my humble investor’s opinion will create good buying opportunities. Australia has the benefit of a stable political structure unlike other areas in the world with the possible exception of Canada, Finland and perhaps Brazil.

There are also more women joining at executive and management level. Costs and skill shortages are testing company’s efficiency of management and this will obviously become clear in their quarterlies. Some of the smaller companies need to up the management grade of executive skills even if they have become producers (Any companies with problems in this regard might like to visit www.Jobs4Mining.com. Ed)

It is also clear that following the ‘stars’ in the industry is as important as reading the balance sheet. There is much talk of consolidation and it will be interesting to see who will win through, maybe even competing with the Rios and BHP Billitons of this world.

As a private investor it was an immensely rewarding experience and I sincerely hope to attend next year. A huge thanks to everyone and to Minesite for giving me the opportunity to experience this event first-hand.

 

[drillinto]

August 19, 2007

That Was The Week That Was … In Australia

By Our Man In Oz
[ www.minesite.com/aus.html ]

Minews. Good morning Australia, trust you survived the stock market blitz?

Oz. It has been a bit like that, with shares falling all over the place. Next week, however, promises some respite because we’re all taking our lead from Wall Street, no matter how illogical that might be in the modern resources world where China dictates the terms.

Minews. That would seem to be especially true for iron ore, one of your hottest exports?

Oz. Correct. And unless we’re both missing something, or the market has already priced in the next price rise, there is some good news on the horizon with iron ore said to be heading for a 25 per cent increase at the next meeting of the miners and the steel mills.

Minews. That’s for later in the year, time for prices now, and any crumbs of good news would be appreciated before your long list of gloom.

Oz. Believe it, or not, and only after sifting through mountains of information, we found a stock that did rise last week, and it was an old Minesite favourite. Troy Resources (TRY). Perhaps it’s a case of quality shining through, or the fact that Troy is one of the few regular dividend payers among the smaller miners, but it managed to post a gain of A2 cents during a week when everybody else was losing their heads. The move from A$2.63 to A$2.65 is less than 1 per cent, but a rise is a rise.

Minews. I reckon the dividend policy has something to do with it, and of course there is the buy-back but not much stock was bought back last week. And that’s it?

Oz. For the full week that’s the best we could do down this way. However, if it’s good news you’re after there were a few stocks to rise on Friday in what was, overall, another down day. Atlas Iron (AGO), one of the likely beneficiaries from the expected iron ore price hike, managed to post a A1 cent rise on Friday, though its closing price of A$1.17 still reflected a fall of A38 cents (24.5 per cent) over the full week. Sundance (SDL) was another of the small irons to end the week in the green with a rise of A3 cents (8.2 per cent) on Friday, though the full week’s trade reflected a drop of A4 cents (9 per cent) to A39.5 cents.

Elsewhere, it was a tough job finding anybody with green ink alongside their name. Vulcan Resources (VCN), the emerging Finnish base metal miner, put on A2 cents on Friday, but was down A7 cents (16.6 per cent) at A35 cents for the week. Apex (AXM) and Kingsgate (KCN) were Friday winners in the gold sector with gains of A6.5 cents and A3 cents respectively. But, both were down over the week. Apex lost A6 cents (6.5 per cent) to close at A86 cents, and Kingsgate lost A34 cents (6.7 per cent).

Minesite. Well done in finding some good news. Time now for a run through the sectors with the bad news.

Oz. Before doing that a couple of big picture items. The Australian dollar, which has been hurting miner by rising sharply over recent months, fell out of bed with a thump last week, dropping US6 cents (7 per cent) to US78 cents. That is, apparently, the sharpest correction in the dollar ever, and believed to be a direct result of hot money exiting both the Australian and New Zealand currencies in the so-called “carry trade” which chases high interest rates around the world. Miners will welcome that bit of good news. Also, it is worth pointing out that while a lot of small stocks have been hammered in the correction the overall metals and mining sector, as measured by the XMM index on the Australian Stock Exchange was down by “only” 7.5 per cent last week, a nasty fall, but not a catastrophe.

Minesite. Thanks for that, now the prices, please?

Oz. The gold sector appears to have held up best, as illustrated by the Friday gains by Apex and Kingsgate and Troy’s sterling effort for the week. St Barbara (SBM), however, was in the red all week, ending down A8 cents (16.3 per cent) at A41 cents. Adamus (ADU) also lost A8 cents (15 per cent) at A45 cents, and Allied Gold (ALD), which you took a close look at during the week, was down A11 cents (23.4 per cent) at A36 cents.

Uranium stocks, apart from Toro (TOE) had a horrid week. Toro, which is closely associated with Oxiana (OXR) and is merging with Nova Energy (NEL), was one of those rare Friday risers with a very modest, but noteworthy, addition of half-a-cent, closing the week at A68.5 cents, still down A9.5 cents (12.2 per cent) for the full week. Other uranium plays were hit hard. Uranex (UNX) lost A53 cents (36 per cent) to A94 cents, but was steady at that price on Friday. Uran (URA), which is pushing ahead manfully with its plans to get control of advanced uranium projects in Eastern Europe, lost A10 cents (34.5 per cent) to A19 cents.

Nickel stocks have been hit hard by the sharp fall in the price of their metal. Jubilee (JBM) lost another A$1.80 (13.6 per cent) to A$11.40. The stock has now fallen A7.04 (38.2 per cent) since peaking at A$18.44 on June 5, little more 10 weeks ago. Minara (MRE) fell by A99 cents (17.7 per cent) to A$4.60. It is now down A$5.07 (52.4 per cent) from its peak price of A$9.67 reached on May 22. Western Areas (WSA) slipped by A76 cents (16.2 per cent) last week to A3.94, and Mincor (MCR) was off by A48 cents (15.3 per cent) to A$2.66.

Iron ore stocks held up better than most, as shown by the modest Friday rises posted by Atlas and Sundance. Other iron ore plays did less well. Grange (GRR), despite reporting a deal with Rio Tinto over the eastern extension of its Southdown magnetite deposit, fell A70 cents (25 per cent) to A$2.10. Gindalbie, another of the iron ore specialists wanting to launch an expensive magnetite mine, dropped A39 cents (28.8 per cent) to A96 cents, and Cape Lambert (CFE) fell A12 cents (23 per cent) to A40 cents. Fortescue (FMG), the most ambitious of all, lost A$4.79 (15.3 per cent) to A$26.50, which is A$15.25 (36.5 per cent) below the stock’s peak price of A$41.75 reached as recently as June 4.

Minews. I think that’s all we can take this week. Thanks Oz.

 

[drillinto]

August 26, 2007

That Was The Week That Was … In Australia
By Our Man In Oz
==> www.minesite.com/aus.html <==

Minews. Good morning Oz, trust you enjoyed last week’s share market recovery?

Oz. It was certainly more fun than the previous month of sliding prices. The biggest factor down this way, apart from central banks pumping cash into the system, was the flow of excellent profit results. For investors in mining stocks last week was the pay off they had been waiting for since the boom started in 2003. Not only did BHP Billiton weigh in with the biggest profit ever posted by an Australian-based company, but a whole series of smaller fry chimed in with what were, arguably, even more exciting results. Stock like Mincor (MCR), Jubilee (JBM), Minara (MRE), Kagara (KZL), and Independence (IGO) produced record profits, and paid out record amounts in dividends.

Minews. The dividend flow is an interesting point which we might look more closely at next week. Time now for prices, please?

Oz. First a point about prices. The last time we looked at the Australian market we joked about finding a stock which rose in price. This week we flip over. Try as you might, it’s impossible to find a stock which fell last week. Much of the movement was recovery from the August sell-off, but we also started to see excitement from discovery news, and profit flow.

Hottest stock of the week was Ramelius Resources (RMS) which operates the Wattle Dam gold project near Kambalda in Western Australia. On Friday, the stock rocketed up on news of a fabulous drill result which included one metre assaying 6770 grams a tonne, or 217 ounces to the metre. The region around Kambalda is famous for its occasional “jewellery shop”, or bonanza grades, and this might be one of those one-hit wonders, but it pushed Ramelius up from a close on Thursday of A$1.32 to an intra-day high on Friday of A$2.10, a gain of A78 cents (59 per cent). It eased back to close at A$1.90, but the rise, and the heavy turnover of 4.7 million shares was the best sign that traders are still keen for mining news.

Minews. Take us through the sectors, starting with gold.

Oz. The flat price of gold during the week didn’t help, but we saw a number of upward moves on drilling results. Centamin (CNT) came out with a fresh set of numbers on its Sukari project in Egypt and shot up A36 cents (37.5 per cent) to A$1.32. But, and this is important, that rise was also an example of the affect of the overall recovery because, on August 9, just 12 trading days earlier, Centamin had been trading at Friday’s closing prices, A$1.32.

Minews. The point being that we’ve simply returned to where we were?

Oz. Precisely. The pattern can be seen across the market, perhaps less so in gold, but certainly evident among the nickel, zinc and iron ore stocks. But, to finish your request about the golds here are a few more prices. St Barbara (SBM) was up A6c (14.6 per cent) to A47 cents, roughly back to where it was. Avoca (AVO) added A16 cents 12 per cent) to A$1.48, which is still well down on the A$1.80 of early August, and Norton Gold Fields, which has wrapped up the purchase of the Paddington project near Kalgoorlie, rose A4.5 cents (19.5 per cent) to A27.5 cents. Non-movers included Kingsgate (KCN) and Bendigo (BDG), which were steady at A$4.71 and A28 cents respectively.

Nickel, thanks to the flow of profit news, and a steadier price for the metal, produced a number of winners, though mainly in the recovery sense of returning to where they were. Jubilee (JBM) shot up a very sharp A$2.06 (18.5 per cent) to A$13.20, but is still down on the A$15 price of a month ago. It impressed everyone with its record profit and high dividend payout. Independence (IGO) also rode the nickel express, adding A82 cents (17.7 per cent) to A$5.45. Mincor (MCR) rose A59 cents (22 per cent) to A$3.25, and Western Areas (WSA) gained A25 cents (6.3 per cent) to A4.19. Cougar Metals (CGM), which is a new player in the nickel game, reported good drilling results from its Pyke Hill project, and added A5.5 cents (34.3 per cent) to A21.5 cents.

Minews. Was there a similar pattern among the iron ore stocks?

Oz. Very much so, aided by the surprise news that a Russian oligarch, Victor Rashnikov, has snapped up a 5.37 per cent stake in Fortescue Metals Group (FMG). The Russian buying helped FMG added A$4.25 (16 per cent) to A$30.75, though the stock was weak again on Friday, losing A$1.65 (5.1 per cent) on the day. Other iron plays did well. Cape Lambert (CFE) rose back over the A50 cent mark with a gain of A14 cents (35 per cent) to A54 cents, the same price as August 13. Grange (GRR) added A25 cents (12 per cent) to A$2.35. Atlas (AGO) was up A14 cents (11.9 per cent) to A$1.31, and Golden West (GWR), which has its foot on a high-grade haematite discovery near Wiluna, rose A32 cents (21.3 per cent) to A$1.82.

Minews. How did the uranium sector perform with the latest fall in its price?

Oz. No real damage. The trend in stock prices was in line with other sectors. Most were up, or back to where they were. That latest uranium price fall to US$90 a pound does mean that the stuff has now fallen 30 per cent from its recent peak, though another way of looking at it is to say that the price is 650 per cent above where it was a couple of years ago. Share prices moves included Paladin (PDN) adding A66 cents (12 per cent) to A$6.16. Uranex (UNX) gaining A10 cents (10.6 per cent) to A$1.04. Extract (EXT) rising A4 cents (7.7 per cent) to A56 cents, and Bannerman (BMN) outperforming them all with a gain of A45 cents (31.3 per cent) to A$1.89, perhaps in the hope that it will get good media reports from a site tour which started last week.

Minews. Time left for a look at any special situations?

Oz. Only one, really. The Consolidated Minerals (CSM) saga dragged on with mystery buyers, takeover offer extensions, and more rude words at 10-paces from the opposing sides, but no real change. On the market, ConsMin added A46 cents (14 per cent) to A$3.75, which is back where it was two weeks ago. One of its suitors, Territory Resources (TTY), did better, adding A20.5 cents (32 per cent) to A84.5 cents on news that production from its Frances Creek iron ore mine is growing.

Minews. Thanks Oz.

 

[drillinto]

August 31, 2007

FT Lex Column Promulgates Some Odd Views On Australia And Gold
Source: www.minesite.com

It is not the job of a newspaper to be popular, but it is its job, particularly of an upmarket pink sheet such as the Financial Times, to give an informed and rational comment on events around the world. On 8 august the Lex column got right up the noses of the Aussie investing public according to broking firm Southern Cross Equities when it said “Aussie punters are as ignorant of bear markets as the first explorers were of monotremes. All equities do is go up. This has created an investment environment as unique as the platypus, the country’s famous egg laying mammal.”
Just to prove Lex wrong the ASX fell quite sharply in the following days as hedge funds shorted financial and resource stocks. In fact two weeks ago our Man in Oz reported that he could find only one stock in Australia’s mining sector that had recorded a gain. But as the brokers pointed out this did not detract from the fact that Australian corporate earnings growth is the strongest in the developed world and mining is part of the whole, not the whole.

On the subject of mining poor old Lex missed the point completely that Australia is shipping metals and minerals on a massive scale every day to China, India and other countries in the Far East. If Lex had listened to the outlook commentary from BHP Billiton it would have heard that the world’s largest mining house reckoned that the “Chinindian story” remained stronger than ever and there had been no impact on demand from US credit volatility. In support of that came the news that iron ore is expected to benefit from a 25 per cent increase at the next meeting of the miners and the steel mills.

Southern Cross Equities suggested that the Lex writer had not managed to get his head round the fact that China and India were now the drivers of commodity demand, and not the US. This is excusable as the Financial Times has long had a love affair with the US; its editor is an ex US correspondent; and it reckons that it is fighting toe to toe against the Wall Street Journal. As a result the Saturday paper – the only one read by Minews – has as many stories about the US by US journos as it does about the UK and Europe. A sad predicament to have got into.

As if to emphasise that it was willing to shoot itself in the foot more than once the Lex column also took a swing at gold last week-end entitled Stolid Gold. The price of gold had not rocketed earlier that week as investors scrambled for quality and the yields on three month Treasury bills fell by almost 200 basis points and Lex felt it had failed in its duty to demonstrate safe haven status.

Maybe these young men, who have probably never invested in their lives, overlooked the fact that the price of gold has risen by an annual compound rate of 19 per cent since their friend George Brown sold off most of the UK’s reserves. They were more interested in the economic comment by Goldman Sachs that there has been little correlation over the past 20 years between inflation and the gold price.

Lex then focussed on the booming demand for gold from India and China and wondered if the rising wealth in these regions was really bullish for gold. As if that question needed answering, the last sentence said it all. “As banking infrastructure develops, wearing one’s savings may lose its bing.” How trite!

 

[drillinto]

September 02, 2007

That Was The Week That Was … In Australia
By Our Man In Oz
Source: www.minesite.com/aus.html

Minews. Good morning Australia, it looks like a little normality returned to your market last week?

Oz. In a way, though it continues to surprise hardened observers, well let’s be honest and call them what they really are, older observers, that small Aussie miners are doing what they’ve never done before; make profits, pay dividends and re-invest. The latest example is Troy Resources (TRY) which reported a 26 per cent profit increase on Friday to a record A$20.1 million, lifted its normal dividend to A7.5 cents a share, and announced a one-for-25 bonus share issue. The market loved it, lifting Troy by A15 cents (5.6 per cent) on Friday to close at A$2.80.

Minews. The profit flows, and dividends, are really setting this period in your market apart from anything we’ve seen before.

Oz. Absolutely. And that’s what some outsiders, such as your friends who write the Lex column at the Financial Times, just don’t seem to realise.

Minews. Teenage scribblers they used to be called. Never invested in their lives nor given mining any serious thought.

Oz.So they don’t realise that times really have changed. China is driving everything that’s happening in this part of the world, and while the U.S. catching a cold might cause the rest of the world to snuffle a bit, it no longer means a bout of pneumonia. To put Australia’s position into perspective there once was a time when Britain was our major export market. Today, Britain barely scrapes into the top 10 with China, Japan, Korea, India, and the Middle East dominating exports. Business with Britain, in fact, is now roughly equal to trade with Thailand.

Minews. And no doubt the trend to focussing on Asia is accelerating?

Oz. That’s the point. The changes underway in global business are quite remarkable and commodity exporting countries such as Australia and Canada are the big winners. Enough of the geopolitical stuff, let’s look at prices and action, with the big game in town last week being another old favourite, Consolidated Minerals (CSM). After months of “phoney war” we got down to the real action on Friday when the Ukrainians, operating under the name Palmary Enterprises, lobbed in a cash bid of A$3.95 a share. Traders instantly took ConsMin up to A$4.09, before closing the week at A$4.07, a gain of A32 cents (8.5 per cent).

Minews. Is that likely to be the killer bid?

Oz. It would be brave man to tip that, though it is interesting that Territory Resources (TTY), one of the other bidders, has effectively sidelined itself, saying it will not be raising its offer, but adopting a wait and see position. Significantly, Territory’s boss, Michael Kiernan, has offered to run the Woodie Woodie manganese mine for the Ukrainians, and suggested a few other deals with them. If that relationship blossoms it will freeze out the original bidder, the Pallinghurst group led by Brian Gilbertson, which has spent the best part of a year trying to get a very complex merger across the line.

Minews. We’ll keep an eye on that situation. Time now for a call of the prices card, please?

Oz. After ConsMin that most interesting situation was the one-time iron ore hopeful Cazaly Resources (CAZ) which, you might remember tried to snatch control of the Shovelanna project from Rio Tinto. Cazaly had what might be its final day in court during the week, lost, and the stock was smartly chopped in half, falling from a pre-legal decision of A56.5 cents to A28 cents. It limped up to end the week at A34 cents, down A22 cents (39.3 per cent). Ouch!

Elsewhere, the mood was solid. The overall market, as measured by the mining and metals index on the exchange, was up 4.1 per cent over the week to close at 4694.8 points. The reason that’s mentioned is that the market has now risen by 653.3 points, or 16.1 per cent, since it bottomed in the August sell off.

In the sectors, nickel regained favour with investors as the price of the metal appeared to steady at around US$13 a pound, and rose beyond that in trade on the London Metal Exchange after we closed down this way. Sally Malay (SMY) joined in the nickel-mining profit stampede with a record A$88.1 million, plus a maiden dividend of A12 cents a share, and rose A58 cents (16.8 per cent) to end the week at A4.03. Jubilee (JBM) stormed back with a rise of A$2.22 (16.8 per cent) to A$15.42, and Western Areas (WSA) added A20 cents (4.8 per cent) to A$4.39.

Iron ore stocks were also in demand, again. Fortescue Metals (FMG) bathed in the limelight of extensive media coverage in the local press after a site tour, adding A$3.25 (10.6 per cent) to A$34. Mt Gibson (MGX) announced plans to expand its an annual exports to six million tonnes of ore a year and rose A4 cents (2.7 per cent) to A1.53. Atlas (AGO was up A7 cents (5.3 per cent) to A1.40, and FerrAus (FRS) gained A4 cents (6 per cent) to A70 cents.

Minews. How did the gold sector behave?

Oz. Mixed. Troy, as mentioned, led the way, with Dominion (DOM) not far behind, also driven by fundamental profit and dividend news. It added A15 cents (5.6 per cent) to A$2.80. Apex (AXM) was the strongest of the emerging producers, gaining A17.5 cents (21.2 per cent) to A$1. Lihir (LGL) gained A9 cents (3 per cent) to A$3.07, despite the threat of a staff strike at its namesake mine. and St Barbara (SBM) crept up A1 cent to A48 cents. The weakest performance came from Kingsgate (KCN) which lost A11 cents (2.3 per cent) to A$4.60.

Other moves worth noting came in the uranium division where Bannerman (BMN) also benefited from a media tour of its Namibian exploration projects, and rose A34 cents (18 per cent) to A$2.23, and Uranex (UNX) regained lost ground with a rise of 12 cent (11.5 per cent) to A$1.16. The only loser was the sector leader, Paladin (PDN), which eased A10 cent (1.6 per cent) to A$6.06.

Zinc stocks were mixed. Perilya (PEM) lost A23 cents (5.6 per cent) to
A$3.85. CBH (CBH) slipped A4 cents (6.8 per cent) to A54 cents, but the biggest producer, Zinifex (ZFX) added A13 cents (0.7 per cent) to A$16.88, and AIM (AIM) was steady at A23 cents despite announcing a sales agreement for its Perkoa mine in Burkina Faso.

Minews. Thanks Oz. We’ll be taking a close look at this dividend business first thing this week. Possibly send the article to Lex.

 

[drillinto]

September 03, 2007

Mining In Australia Assumes The Mantle Of Legitimate Business

By Our Man In Oz
www.minesite.com/aus.html

Novice investors in Australian mining shares have sometimes wondered why the people assembling stock exchange quotes tables bother to incorporate columns showing dividend and yield. For the past, roughly, 100 years, those columns have largely been blank; just little dashes showing what might have been. Predecessor companies to the modern BHP Billiton and Rio Tinto did manage to do the right thing by shareholders and make regular profit distributions. But for the other 99.99 per cent of Australian miners the concept of actually giving money back to the owners of the business was totally foreign, abhorrent even (“dividends, wash your mouth out, boy!) – until now.
The boom, god bless it, is filling in the dashes. Companies that once did nothing more than suck in capital from unsuspecting punters, including many innocent Brits, are now doing the unthinkable and paying handsome dividends, effectively reversing the river of capital which once only flowed in. Jubilee Mines, Independence Group, Kagara Zinc, Oxiana, Troy Resources and even the troubled Consolidated Minerals, are among the growing band of small Aussie stocks mailing out dividend cheques as you read this, and promising more in the future.

For investors this is a sea change. No longer will they be forced to value mining stocks using some spurious comparison such as ounces of gold in the ground (but not mined), or tenements “close to” something big, owned by someone else, (the science of near-ology), or “what if” scenarios such as what if some kind government built a 1000 kilometre railway to our marooned orebody in the middle of the Gibson Desert. Now, there are yields to compare, earnings per share to calculate, and consideration of the tax treatment of the payout. In short, mining has become a business.

And what a business! Jubilee, for example, lifted net profit to a record A$173.1 million in the year to June 30, a figure which represents a gross profit margin of 70.6 per cent. The reward for shareholders is a final dividend of A37 cents a share, taking the full year’s payout to A67 cents, which means the company is sticking to its plan of paying at least 50 per cent of its profit in dividends. In the current financial year, the profit might not be as high as the nickel price retreats to something resembling a more normal level, whatever that is in what still looks like a 20 year boom, but the key consideration here is margin. Jubilee is producing nickel at US4.05 a pound and the price of the stuff remains above US$12 a pound.

Jubilee, to be fair, is an extreme example of what a high-grade nickel mine is capable of doing in a high-price environment. But, isn’t that what we were promised in 1969 when Poseidon discovered Mt Windarra and the share price shot to A$250 on a wing and a prayer – and not a dividend in sight. This time, as they used to say during the tech-boom, there really has been a paradigm shift. This time many ,but not all, Australian mining companies are being professionally managed. There is a natural order evolving which has always existed in other businesses – investment in research (exploration), building the factory (a mine), making widgets (mining the minerals), making a profit, and paying a dividend, year-after-year.

Consider some of the other results which snuck in under the blizzard of news media commentary in the week when BHP Billiton announced its monster US$13.4 billion profit, and lifted the annual dividend to US47 cents a share. While everyone was gawking at those numbers a one-time financial disaster called Minara Resources chimed in with a 147 per cent increase in profit to A$246 million and said it would payout A$116 million of that via a dividend of A25 cents a share. Ten years ago, when Minara was known as Anaconda Nickel and holders of its junk bonds were baying for blood, no-one would have believed you if a suggestion had been made that one day this most troubled of businesses would be paying dividends.

The story goes on. Independence Group lifted profit by 201 per cent to A$105 million and is paying out A18 cents a share made up of two conventional payments and two one-off special dividends, presumably to shovel the cash out the door. Kagara Zinc’s profit was up 152 per cent to A$89.8 million with a final dividend announcement still being considered by the board, but whatever it is it will be on top of a maiden A10 cents a share last year. Oxiana saw its profit slip 34 per cent to A$173.5 million for the six months to June 30, but will still lift its interim dividend by 33 per cent to A4 cents a share, and even Consolidated Minerals, under siege from competing bidders, managed to remember a A4.5 cent a share dividend after posting a profit of A$31 million in the June 30 years, a noteworthy turnaround on last year’s loss of A$6.5 million.

What makes the rising tide of dividends so interesting is that it’s coming from across the full spectrum of the mining world. Nickel miners are paying handsomely, as are copper miners, zinc miners, coal miners, gold miners, and soon there might even be a flow of cash from the current market favourite, iron ore. The question for everyone is what does this new-found interest in paying dividends mean for mining? The answer is everything. It means that mining in Australia, after decades - possibly a century - has finally come of age. Management now realises that capital invested must eventually be rewarded. The amazing thing is it has taken so long to get to this position, and even more amazing that investors have stuck with the sector through so many lean years, dreadful deals, and even more dreadful management.

Mining in Oz has gone legit, believe it, or not, and all those little dashes in the yield and dividend columns of quotes tables will steadily be filled in. Perhaps the only miracle greater than this would be England retaining its World Cup rugby title in France.

 

[drillinto]

September 05, 2007

Unknown Bidder Makes Approach To Golden West Resources

By Our Man In Oz
www.miningsite.com/aus.html

If the Australian city of Melbourne had not already been used as the backdrop for an end-of-the-world-movie (On The Beach with Gregory Peck and Ava Gardner, 1959) then the producers might have chosen somewhere even closer to the edge, Wiluna, in central Western Australia. It’s here, where harsh sheep-farming country fades into the never-never of the Gibson Desert that a handful of oldtimers once eked out a living in narrow-vein goldmines, and no one really did much else, save for a few courageous attempts to grow citrus and melons using underground water. It was the promise of finding more of the elusive Wiluna gold which drew Gary Hutchinson and the crew at the aptly-named Golden West Resources to the area in 2005, but it’s something completely different which will keep them there – iron ore.
Never, even in the wildest dreams of a generation of prospectors who have kicked the rocks around Wiluna, has anybody imagined that the surfboard flat geology was hiding some of Australia’s richest deposits of iron ore. But, the latest assays from a series of elongated structures, some outcropping at the surface, and running for at least 45 kilometres north-south, are eye-popping to say the least. In one astonishing drill hit the assay was 106 metres at 67.9 per cent iron – about as rich as the stuff can get in a natural environment, and similar to the grades originally reported in the 1960s from the rich (and massive) deposits of iron discovered by prospectors working with Rio Tinto and BHP Billiton in the Pilbara region further to the north.

As well as the grade and thickness the ore type is just what Japanese and Chinese steel mills want, high-quality haematite ore which is low in the steel-killing impurities of phosphorous and alumina. Silica grades are relatively high, but manageable, says Hutchinson who has been struggling to get the outside world to take much notice of what he’s on to. Minesite’s Man in Oz, despite a couple of invitations, has not been able to find the time to visit the Wiluna site. Booms mean time is short, and he also remembers past visits to Wiluna, a godforsaken dump where his mother used to canter around the scrub country on horseback.

The return trip to Wiluna can wait, but news of what is being proved up at the discovery site known as Wiluna West cannot. An early Joint Ore Reserves Committee (JORC) compliant resource is of 50.1 million tonnes of haematite grading 61 per cent iron. Much more will come. “We’re pretty confident that we’ll get the resource up 100 million tonnes by the end of the year, and then up to 200 million tonnes,” Hutchinson said. He declines to put a dollar figure on that potential resource but even Minesite can multiple 200 by the current price of iron ore, which is about A$77 a tonne, and arrive at A$15.4 billion, enough to make anyone keen to turn a resource in the ground into ore on a China-bound ship.

Hutchinson said the immediate plan for Wiluna West is to keep on drilling. The five near-parallel mineralised units identified so far offer a wide range of targets and so far only two, Bowerbird and Joyners Find, have been incorporated in that initial JORC resource. “We’ve only looked at about 30 per cent of the total mineralised units which cover about 125 kilometres when you add together the total strike of the five formations,” Hutchinson said. “We expect to have many more assays available by the end of the year, and an early-stage scoping study which will help with offtake agreements and funding to get us into production.”

For investors, Golden West has been a surprise packet. The stock was trading at less than A50 cents a share at the beginning of 2006 before rushing to an all-time peak of A$3.35 just before Christmas, driven by euphoria about Chinese demand for iron ore and the haematite assay grades. Since those heady days the market has become more cautious, asking this critical question: “how will Golden West get its ore to market?” The trip west, to the port of Geraldton, is 700 kilometres and in need of a new railway. The trip south, is a truck-and-train option, to the established iron ore export port of Esperance, and covers 900 kilometres.

What this almost certainly means is that Golden West will start small, via Esperance, at a rate of around one million tonnes a year, sufficient to generate a cash surplus (after heavy transport costs) of around A$10 a tonne, or A$10 million a year. As the tonnage grows, the margin rises. One study points to a margin of A$25 a tonne when shipping levels reach 10 million tonnes, for a cash surplus of A$250 million a year, or more than double the current A$120 million capitalisation of the company.

“We have two plans for export,” Hutchinson said. “The first was to head south, and the latest is to look west. We have taken an option on space at Esperance, but if we go that way, and want to get to the 10 million tonne level, then we’ll need to build a railway from Wiluna to Leonora, and upgrade the line to Esperance. The cost of that looks to be around A$1 billion, but the line could eventually be upgraded to take 20 million tonnes a year.” The western option, he said, is to join one of three groups looking to build a rail to a new port called Oakajee near Geraldton. “We’re getting approaches from everyone, but our attitude is we love you all, but whoever wins the race, we’ll join.”

No sooner said than done. A small company called Fairstar Resources apparently wants to make a bid for Golden West. Nobody seems to know much about it except that is based in the Perth industrial suburb of Osborne Park and has some reasonable directors, but zero publicity. Maybe someone overheard Gary Hutchinson talking to our Man In Oz and realised this was too good an opportunity to miss.

 

[drillinto]

September 07, 2007

The Bidding For Consolidated Minerals Descends Into Farce

By Our Man In Oz
Source: www.minesite.com/aus.html

Seven months ago the directors of Consolidated Minerals were convinced that the company they run was worth roughly A$2.30 a share, and they recommended a partial takeover bid pitched at that price. Today, the same people believe the company is worth A$4.10 a share and they now recommend that price. Tomorrow, who knows, because on the market ConsMin is trading at A$4.30, 4.8 per cent more than what the directors currently recommend and 87 per cent more than the original deal proposed in February by Pallinghurst Resources, a business run by South African deal-maker, Brian Gilbertson.
There are many questions to be asked of everyone involved in the ConsMin saga. So far, no-one seems to have asked the directors what they really (truly, cross-your-heart) reckon their business is worth, or why Gilbertson conceived a merger so complex that it required a 400-page explanatory memorandum, mailed to thousands of shareholders, and now used to press flowers.

To be fair, ConsMin is at the centre of a bidding war with large egos, armed with larger cheque books, tossing cash around as if it were confetti, leading to a corollary question on value: has the price of ConsMin now entered cloud cuckoo land, or is this simply the sharp end of the boom as cash-rich buyers battle for scarce assets?

The answer to the first question about whether the directors know what their company is worth has to be that the poor darlings haven’t a clue. The answer to the second question is that the battle for ConsMin has undoubtedly taken on all the finesse of a rugby scrum, on a sticky pitch, during a thunderstorm. It really is a case of the winner being the biggest and ugliest brute left standing, and not really caring about the prize, or that the prize might well be a wooden spoon.

To understand the ConsMin fiasco it’s best not to call it that. Patient shareholders of the small Australian manganese, chromite and nickel miner are doing very nicely as they enjoy a ride as wild as anything since the days of the Poseidon nickel boom when everyone left their brains at the door of the now defunct Perth Stock Exchange. With ConsMin the game started on the day Michael Kiernan saved it from oblivion after - and remember this- after the Woodie Woodie manganese mine effectively failed, sending its then owner, Valiant Consolidated, almost to the knackers yard.

The historic troubles of Woodie Woodie, a mine worked intermittently for more than 50 years, depending on the price of manganese, have been as conveniently forgotten today as the popped Poseidon bubble. Perhaps this really is a boom forever (note to editor: that was typed with fingers crossed!). On a more serious note what is happening with ConsMin does no-one any credit. Yes, it’s making money for the players involved, but there is an unmistakable odour of boom-time excess wafting off the stock.

Consider the facts. Talk of a takeover/merger between ConsMin and Pallinghurst first surfaced in October last year. A formal merger proposal was delivered on February 23. The four month gap between the referee blowing the whistle and ball actually being kicked should have rung a warning bell. There should also have been warning bells ringing about Kiernan’s desire to get back on the field and repay a few courtesies dished out by some ConsMin directors as he was departing. And, there should have been a warning about the background role of Richard Elman, chief executive of the commodities trading business, Noble Group, a supporter of Kiernan, and the man holding a “life of mine” marketing contract over Woodie Woodie.

In any event, Kiernan counter bid via one of his new companies. Gilbertson countered. Kiernan countered the counter. Then a heavy duty Ukrainian steel maker, Gennadiy Bogulyubov, entered the game, and finally a Norwegian alloy specialist, Tinfos, weighed in. At the last count, Tinfos had 5 per cent of ConsMin, Bogulyubov 14.36 per cent (through a company called Palmary), and Pallinghurst 10 per cent. Kiernan had very little, and appears to have backed away from the bidding.

This final point about Kiernan appearing to “run dead” by not increasing his cash and share swap offer is critical to what’s afoot because no-one, and that includes the board and management of ConsMin, knows Woodie Woodie as well as he does. Unlike the chaps in slick suits, he once lived in a converted bus at the mine gate acting as truck tally man. It was his intimate knowledge, and extreme annoyance at not being paid by Valiant, which led him into his first deal with Elman. The nature of that deal was that Elman finished up with ownership of the mine, hence today’s life of mine contract, but he needed someone to run it. Between them, Elman and Kiernan make an excellent pair of blunt instruments – but they are far from being stupid blunt instruments, and they also know exactly what an asset is worth.

Which takes us back to the top, and the critical questions - what’s ConsMin worth? The market, which is always right, says A$4.30. Gilbertson says A$4.10 , but with a clever rider on his offer that he will match any rival bid, and he’s ready to pay now, effectively a “top up” facility to encourage quick acceptances. That puts the ball on Bogulyubov’s side of the pitch, and it needs to act quickly, or Gilbertson steals the day.

But, even if Gilbertson wins what is it that he’s actually won? For a price, presumably north of A$4.10 once the mud settles, he gets a pre-loved manganese mine which is suddenly being praised as one of the best in the world. Well, 10 years ago, and even 50 years ago, it certainly wasn’t one of the best. Yes, the manganese price has risen, but it has been known to fall just as often, and this is a company which, seven months ago, was valued at A$2.30 by the people who run it, and a company which was once run by a man who is now not interested.

Poseidon time? Jolly close!

 

[drillinto]

September 09, 2007

That Was The Week That Was … In Australia
By Our Man In Oz
www.minesite.com

Minews. Good morning Australia, looks like it was a big week down your way.

Oz. It was. Half of Sydney was closed to accommodate George Bush, and the other half was closed for China’s president Hu Jintao, and the Russian leader, Vladimir Putin. But before you tick me off for seeming to talk about irrelevant political matters, such as the leaders gathering for the APEC forum, there is method in my madness. Bush was a waste of space and didn’t seem to know where he was , but Hu and Putin were very useful in reinforcing the resources boom which your friends at the Financial Times are struggling to recognise.

During his time in Oz, Hu has been merrily plonking his chop ( a Hong Kong expression for signing deals, not what you think. Ed), or overseeing deals involving new iron ore mines, new liquefied natural gas sales, and looking for more uranium. Putin, who has plenty of gas which he sometimes sells to Europe. or not, depending on his mood, signed up for Aussie uranium, and was in town as some of his “bizziness” friends were snapping up iron ore investments.

Minews. Your point being that Britain and the rest Europe really isn’t getting a look in?

Oz. Precisely. The game is changing with results as surprising as an Argentinean win in the rugby world cup - an event we should stop laughing about after France got walloped on Saturday.

Minews. Enough of all that, time for prices, please?

Oz. Two sectors and one special situation stood out last week. Gold and iron ore were hot, and Consolidated Minerals was red hot, as you reported on Friday. ConsMin, for the record, ended the week at a 12-month high of A$4.31, up A24 cents (5.9 per cent), and a very handsome A$2.68 (164.4 per cent) above the low point of the past year which was A$1.63. Someone, as discussed, is paying a whopping premium for control of a relatively small manganese miner.

Elsewhere, it was the turn of gold and iron ore stocks to shine, and for nickel, uranium and base metal stocks to retreat to the shadows. The golds, obviously, were assisted by the price of the metal climbing back over the US$700 an ounce mark, a beneficiary of the U.S. credit crisis, or is it a debt crisis, or is it just bankers being too clever by half lending money to people who could never meet the repayments.

Minews. Prices, please?

Oz. Right, sorry, but that sub-prime situation really is quite bizarre. Among the gold stocks, and we can expected better next week, there was a wholesale uplift. Dominion (DOM) hit a 12-month high of A$3.29 on Friday thanks to excellent results from its Challenger mine. Profit-takers, however, clipped the price back at the close with the stock ending the week at A$3.16, up A31 cents (10.8 per cent). Troy (TRY) was another to join the game, adding A40 cents (14.3 per cent) to A$3.20, but did get as high as A$3.25 during Friday trade. As well as riding the gold price, Troy has just reported a strong profit result, and has about A$100 million in cash sitting in the bank, and with its eye on more deals in Brazil.

Other gold stocks to join the party included: Tribune (TBR), which we don’t hear a lot about but which has reported good results from its share of the Higginsville mine. It added A24 cents (19 per cent) to A$1.50, though in fairly thin trade. Monarch (MON), which lodged promising exploration results, rose A4.5 cents (16.6 per cent) to A31.5 cents. Goldstar (GDR) said it was making progress with its Tubal Cain high-grade exploration project in Victoria, and gained A4 cents (11 per cent) to A40 cents, and St Barbara (SBM) put on A5 cents (10.4 per cent) to A53 cents. Overall, most of the sector benefited in some way and, with the London bullion market closing above US$700 an ounce on Friday, the good times should continue.

Minews. And there was also good news among the iron ore stocks?

Oz. Yes. This really has been a remarkable performance with Asian demand for steel showing no sign of slowing, and now with Russian and Ukrainian steel makers joining in the rush for resources. Our old favourite, Fortescue Metals Group (FMG) stormed back into the headline after Russia’s Magnitogorsk Iron and Steel said it had snapped up a 5.37 per cent stake in the rapidly-emerging iron ore miner. The stock added A$3.75 (11 per cent) to close at A$37.75. Elsewhere in the sector, Golden West (GWR) benefited from a takeover bid, rising A28 cents (15.1 per cent) to A$2.13. Murchison Metals (MMX), one of the big potential beneficiaries from Chinese participation in a new railway and port, gained A21 cents (4.8 per cent) to A$4.58, and Atlas Iron (AGO) was up A12 cents (8.6 per cent) to A$1.52. A couple of the iron ore stocks did fail to fire, perhaps because they are both chasing high-cost magnetite developments, and the cost of debt is rising. Grange Resources (GRR) lost A7 cents (3 per cent) to A$2.25, and Cape Lambert was A1 cent (1.8 per cent) at A54 cents.

Minews. Time for the bad news on nickel and uranium.

Oz. It’s not really bad, just weaker all over because of commodity price worries. Most of the nickel sector fell, but not a lot. Sally Malay (SMY) was down A26 cents (6.5 per cent) to A$3.77, Poseidon (POS) lost A3 cents (3.5 per cent) to A84 cents, and Western Areas (WSA) lost A1 cent to A$4.38. On the flipside, Jubilee (JBM) continues to expand, impressing investors, and adding A64 cents (4.2 per cent) to A$16.06.

Uranium stocks, while generally lower, but also not badly affected. Paladin (PDN) lost A11 cents (1.8 per cent) to A$5.95. Uranex (UNX) fell A6 cents (5.2 per cent) to A$1.10, and Marathon (MTN) was down A5 cents (1.3 per cent) to A$3.85. Deep Yellow (DYL) went against the trend, adding A2 cents (5 per cent) to A42 cents.

Minews. Thanks Oz.