Extract Resources Limited: An exciting Prospect!
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Topic: Uranium Mining Stocks — April 21st, 2009
Chart courtesy of StockCharts.com
Extract Resources Limited (EXT) was brought to our attention by one of our readers through the comments section on a recent article, so we have placed it on the Watch List for now. The major shareholder is Kalahari Uranium Limited who can be found on the AIM section of the London Stock Exchange under the symbol of (KAH).
As we can see from the above chart EXT has made incredible progress this year with the stock doubling and doubling again. However it is now taking a well earned breather as some investors take profits off the table.
Extract Resources is an Australian company with offices in South Perth, Western Australia and Windhoek and Swakopmund in Namibia, through its subsidiary company, Swakop Uranium. Extract Resources is an Australian-based uranium exploration company whose primary focus is in the African nation of Namibia. The Company’s principal asset is its 100% owned Husab Uranium Project which contains two known uranium deposit areas: Rossing South; and Ida Dome. Extensive exploration potential also exists for new uranium discoveries, in addition to the already known occurrences, Ida Dome having a resource of 25mlbs of U3O8.
The management team looks solid and has many years of experience in the mining industry to its credit along with experience gained in Namibia which is an absolute must. The CV for the Managing Director, Peter McIntyre, reads as follows:
Mr McIntyre holds a Bachelor of Science in Civil Engineering and is a Fellow of the Institution of Engineers, Australia. He has been involved in the mining industry for 30 years which included 15 years with WMC Ltd in various senior management positions and has been involved with the development of major projects. Mr McIntyre is a director of Atticus Resources (ASX:ACZ) and is also a director of Carbon Energy (ASX:CNX). He completed an MBA program at the Massachusetts Institute of Technology in Boston.
The remainder of the board are similarly qualified.
We have made in vestments in the past in Namibia and on the 15th May 2007 we recommend buying UraMin Incorporated and at that time this what we wrote about Namibia in terms of the political risk there.
As far as geopolitics are concerned, we are comfortable with Namibia as a country on the whole. There is a lot of mining in Namibia and it is the fourth largest exporter of non-fuel minerals in Africa. Mining accounts for 20% of Namibia’s GDP and it is the worlds fifth largest producer of uranium so another uranium mine going into production should go smoothly but we will be keeping a close watch for any developments.
Taking another look at the situation in Namibia we are reasonably relaxed about it and have no real fears about investing there. However you can keep an eye on what goes on there via the New Era, a newspaper for Namibia by clicking this link.
Extract Resources Limited trades under the symbol of EXT on both the Australian Stock Exchange and the Toronto Stock Exchange. The headquarters are in Perth, Western Australia.
According to Google Finance the Market Capitalization is A$1.22 billion, with a 52 week high of $5.42, a 52 week low A$0.75 and closed yesterday at A$3.85. The major shareholder is Kalahari Uranium Ltd (AIM:KAH) - the top 20 shareholders hold 80% of the 223m shares on issue. Also note that Polo Resources Limited have recently increased their holding in the company to approximately 10.1% of Extract’s fully paid ordinary shares.
For disclosure purposes we do not own this stock, however, we are watching it.
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Have a good one.
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Just a thought:
EXT has a resource of 25 million pounds valued at A$2.5 billion assuming uranium sells at A$100/lb which is the long term price on Tradetech of US$70.00/lb. The market capitalization for Extract is AUD$1.18B at the moment which leaves about A$1.0 billion for mining costs, transportation, etc. At the time of writing we do not what these costs are but hopefully one of our knowledgeable readers will dig up something for us. Excuse the pun. Even without these costs we can see that if the stock price doubles so does the market capitalization which means that we would be buying the future potential of more discoveries as the current discovery would be built into the price. Just a thought.
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HI hope this helps
Paydirt Uranium Conference, Adelaide - March 2009
EXTRACT RESOURCES LTD Audio Webcast
http://www.brr.com.au/event/56279/company-presentation
Friday, April 17, 2009
Emerging Metals ups interest in Kalahari Minerals to 9.84%
company news image
Kalahari Minerals (AIM: KAH) continues to be a much sought after share.
Emerging Metals (AIM: EML) announced that it has acquired a further 1.78 million shares, increasing its stake to 17.6 million shares, or 9.84% of the Company. Stephen Dattles, Co-Chairman of Emerging Metals is also Chairman of Polo Resources, which holds a 5.7% stake in Extract Resources (ASX, TSX: EXT).
It is worth reminding readers that Kalahari Minerals key investment is a 38.68% stake in Extract Resources. Rio Tinto (LSE, ASX: RIO) is a significant shareholder in both companies, with a 15.8% interest in Kalahari Minerals and 15.6% interest in Extract Resources. Niger Uranium (AIM: URU) has a 15.5% stake in Kalahari Minerals.
Extract Resources main focus is the Husab uranium project in Namibia which contains the Rossing South, Ida Dome and Hildenhof prospects, and is located directly south of Rio Tinto’s world class Rossing Mine.
At Rossing South, an initial resource estimate of 108 million pounds of U3O8 at a grade of 430 parts per million was announced in January 2009 for Zone 1, whilst at Ida Dome, a 25.1 million pounds of U3O8 has been defined, effectively giving Extract a total resource of 133.1 million pounds. An update on the resource at ‘Zone 2’ is expected in summer 2009.
http://proactiveinvestors.co.uk/companies/news/5245/emerging-metals-ups-interest-in-kalahari-minerals-to-984-5245.html
DJ Polo Resources Strategic Investment In Extract Resources
http://www.marketwatch.com/news/story/dj-polo-resources-strategic-investment/story.aspx?guid={DC05297E-CD61-4777-AD49-FABCE1C75DD5}&dist=msr_2
Comment by Vizzini — April 21, 2009 @ 1:18 pm
Hi,
I don’t know where you are getting your information but it is not up to date. Yes there is a 25 million lb resource in the IDA dome area but the latest JORC statement (read it at http://www.extractresources.com.au/DesktopModules/Bring2mind/DMX/Download.aspx? ) shows 108 million lbs in zone 1 of the Rossing South Area and that is at 430 ppm.
Zone 2 is being drilled at the moment and the expectation is that August 2009 will see a JORC statement for that area as well as an upgrade for zone 1.
Hope this has helped.
Comment by Lord Elpus — April 21, 2009 @ 11:41 pm
Lord Elpus,
The 108 million lbs that you refer to is only an estimate and has not been certified by a qualified person as yet.
Comment by Uranium Stocks — April 22, 2009 @ 12:48 am
HI Uranium Stocks
Please read the quarterly report just released and listen to the Paydirt Uranium Conference Adelaide - March 2009
EXTRACT RESOURCES LTD Audio Webcast
http://www.brr.com.au/event/56279/company-presentation
The definition of the Rossing South Zone 1 maiden resource was an important milestone for the Company which confirmed Rossing South as the highest grade primary granite hosted uranium deposit in Namibia. The Inferred Mineral Resource, following JORC Code guidelines, is 115 m t @ 430 ppm for 108.3m lbs U3O8.
ASX RELEASE
22 April 2009
Please find attached a link to the quarterly report for the quarter ended 31 March 2009.
http://www.extractresources.com/DesktopModules/Bring2mind/DMX/Download.aspx?TabId=631&DMXModule=1420&Command=Core_Download&EntryId=3337&PortalId=13
Comment by Vizzini — April 22, 2009 @ 2:08 am
Team,
We stand corrected and duly apologize, the ASX Release does say:
The definition of the Tossing South Zone 1 maiden resource was an important milestone for the Company which confirmed Rossing South as the highest grade primary granite hosted uranium deposit in Namibia. The Inferred Mineral Resource, following JORC Code guidelines, is 115 m t @ 430 ppm for 108.3m lbs U3O8.
Bob
Comment by Uranium Stocks — April 22, 2009 @ 2:40 am
Hi Uranium Stocks
Also Ida Dome, 25.1 million pounds of U3O8 has been defined, effectively giving Extract a total resource of 133.1 million pounds. An update on the resource at ‘Zone 2’ is expected in summer 2009.
“Kalahari faces the future from a strong and confident position and our strength is nowhere more clearly demonstrated than in our current 38.85% interest in ASX listed Extract. With circa 133.1 million pounds of U3O8 resource already reported at JORC status, which we anticipate to be upgraded to in excess of 250 million pounds of U3O8 in the coming months, we have significant exposure to one of the world’s most exciting uranium discoveries.”
http://steelguru.com/news/index/2009/04/06/ODkwNjI%3D/Kalahari_Minerals_announces_2008_result.html
Comment by Vizzini — April 22, 2009 @ 3:01 am
The definition of the Tossing South Zone 1 maiden resource
Thats a bit of a nasty typo
Comment by Harlee7 — April 22, 2009 @ 10:56 am
A good day for the share holders of EXT, up 13.56% to close at $4.27 on the ASX, well done you guys.
Comment by Uranium Stocks — April 23, 2009 @ 6:33 am
Another good day for the share holders of EXT, up 10.91% to close at $4.98 on the ASX, once again well done you guys.
Comment by Uranium Stocks — April 27, 2009 @ 8:16 am
ASX RELEASE
April 27 2009 – Extract Resources
Highlights:
• Namibian Ministry of Mines and Energy confirms renewal of EPL3138 (which includes the Rossing South deposit).
• Rossing South Zone 2 drilling is progressing on schedule and continues to encounter zones of massive high grade alaskite-hosted uranium mineralisation.
• Rossing South Zone 1 drilling results further define and extend the known mineralisation.
• Seven drill rigs now operating on site (5 RC + 2 Diamond).
• Exploration drilling that will explore to the west of Zone 1 and south of Zone 2 has commenced.
Chemical assay results not previously reported from Rossing South include:
Hole ID From To Mineralised zones
(m) (m) (U3O8)
Zone 1
RDD028 282 323 41m @ 1131 ppm
and 354 406 52m @ 835 ppm
RRC256 142 250 108m @ 485 ppm
RRC258 120 136 16m @ 2071 ppm
RRC260 186 292 106m @ 514 ppm
RRC278 101 208 107m @ 638 ppm
Zone 2
RDD023 316 365 49m @ 1307 ppm
RRC266 249 270 21m @ 3920 ppm
http://www.asx.com.au/asxpdf/20090427/pdf/31h7qwzss5xpsl.pdf
Comment by Vizzini — April 27, 2009 @ 8:52 am
EPL RENEWED
“Fantastic” Rossing South uranium grades continue to impress
Some more excellent grade figures for the Rossing South uranium project have been announced by operator Extract Resources.
Author: Lawrence Williams
Posted: Monday , 27 Apr 2009
LONDON -
A perhaps over-confident announcement from Kalahari Minerals chairman, Mark Hohnen, said “Rossing South continues to yield fantastic results and, these latest set of results reconfirm that Rossing South is the highest grade granite hosted uranium deposit in Namibia and that it continues to evolve into one of the largest uranium deposits in the world.”
However, Hohnen can perhaps be forgiven his superlatives as the latest drilling results, announced by Extract Resources, in which Kalahari has a 38.6% stake, are adding some excellent data to what is already an extremely impressive potential resource, located just to the south of Rio Tinto’s Rossing uranium mine.
Extract reports that it has seven drilling rigs working on defining the deposit and continues to encounter zones of massive high grade alaskite-hosted uranium mineralisation, and is now working on extending the resource to the west of Zone 1 and south of Zone 2.
The latest announced drilling results are indeed somewhat more than promising with good intersection thicknesses varying in grade between 485 ppm and 3,920 ppm. The defined NI 43-101 resource at Rossing South has already been estimated at 108 million lbs of U3O8 at a grade of 430 ppm using a cut-off of 100 ppm, which is in excess of the size and grade at Rio Tinto’s Rossing operation which is one of the world’s largest uranium mines.
Earlier this month Extract announced that it has appointed Australian engineering group, GRD Minproc, to conduct preliminary and definitive feasibility studies on the project.
Not surprisingly, Extract and Rossing South have been the subject of much interest with announced stakes in the company already having been taken up by Rio Tinto and Polo Resources. Rio also holds a significant stake in Kalahari as does a Polo associate by virtue of having the same chairman in Stephen Dattels, Emerging Metals. At some stage it looks as if a major take-over battle for Rossing South is likely to drive share prices higher - particularly as Namibian uranium finds have been carrying premium valuations.
The most likely winner would seem to be Rio Tinto with its neighbouring Rossing mine, although Rio has more pressing debt concerns to deal with at the moment. But under this scenario, if the price is bid up, Polo and Emerging Metals shareholders could make a killing too, as neither would seem to have the financial muscle to develop a mine there themselves!
Meanwhile Extract has also announced that the Namibian Government has extended the Exclusive prospecting Licence EPL3138, which covers the Rossing South ground, for two more years.
http://www.mineweb.co.za/mineweb/view/mineweb/en/page72103?oid=82484&sn=Detail
Comment by Vizzini — April 27, 2009 @ 10:50 pm
Haywood research report - May update
New Target A$6.60
8/05/2009 849.5 KB
http://www.extractresources.com/DesktopModules/Bring2mind/DMX/Download.aspx?EntryId=3343&PortalId=13&DownloadMethod=attachment
Comment by Vizzini — May 8, 2009 @ 2:04 am
TD Weisel research report - May update
8/05/2009 849.5 KB
http://www.extractresources.com/DesktopModules/Bring2mind/DMX/Download.aspx?EntryId=3344&PortalId=13&DownloadMethod=attachment
Comment by Vizzini — May 8, 2009 @ 2:06 am
Vizzini, Thank you very much for these links, all good info.
Comment by Uranium Stocks — May 8, 2009 @ 3:27 am
500 million lb of U3O8
12 May 2009
Result of Annual General Meeting
http://www.londonstockexchange.com/LSECWS/IFSPages/MarketNewsPopup.aspx?id=2155563&source=RNS
Comment by Vizzini — May 12, 2009 @ 12:26 pm
New Extract Resources broker report from WH Ireland
http://www.minesite.com/fileadmin/content/pdfs/Brokers_Notes_May/ExtractWHI180509.pdf
Comment by Vizzini — May 20, 2009 @ 1:54 pm
Vizzini
Thanks for the broker report - one of the best I have read. I dont suppose you have a WH Ireland broker report for Bannerman?
Comment by Steve Latta — May 25, 2009 @ 1:50 pm
D J Carmichael 2009 update report has just been posted on Extracts website.
http://www.extractresources.com/DesktopModules/Bring2mind/DMX/Download.aspx?EntryId=3351&PortalId=13&DownloadMethod=attachment
Comment by Vizzini — May 27, 2009 @ 4:35 am
EXTRACT RESOURCES LTD Audio Webcast
EXT - AMEC 2009 National Mining Congress - Richard Henning, Business Development Manager
Wed, 27 May 2009 01:45PM
http://www.brr.com.au/event/57862/ext-amec-2009-national-mining-congress-richard-henning-business-development-manager
Comment by Vizzini — May 27, 2009 @ 4:36 am
Announcements released as EXT
28/05/2009 BBY Resources Conference Presentation 26
http://www.asx.com.au/asxpdf/20090528/pdf/31ht6frfd757dr.pdf
Comment by Vizzini — May 28, 2009 @ 1:12 am