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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Aztec Res. | AZR | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 0.00 | 0.00% | 10.00 | 01:00:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 10.00 | 10.00 |
| Top Posts |
|---|
Posted at 01/5/2006 14:22 by red ninja See the August 2005 minsite article mentions some figures.Aztec Resources Publishes Greatly Improved Bankable Feasibility Study For Koolan Island Iron Ore Project Good timing by AIM listed Cambrian Mining in May when it agreed to swap 60 million shares in AIM and Aussie listed Aztec Resources for a million shares in Asia Energy with RAB Special Situations (Master) Fund. Just to clarify the position this deal increases Cambrian's holding in Aztec to 18.7 per cent, while reducing its shareholding in Asia Energy to 22.7 per cent. At the time Cambrian rationalised this share exchange as assisting Cambrian to achieve its objective of being a diverse mining house primarily servicing the steel industry. Fair enough, Ian Burston, the executive chairman, learned all about the mining and transportation of iron ore when managing director of Portman, another leading Australian iron ore producer, so Aztec is in experienced hands. Now Aztec has come out with its bankable feasibility study on the Koolan Island iron ore project which is located in the Yampi Sound 130 kms north west of Derby in Western Australia. BHP produced 68 million tonnes of iron ore from the island between 1965 and 1993, but left as the project was no longer considered core to the major and the price of iron ore was a lot lower than it is now. It left behind it plenty of iron ore as the bankable feasibility shows and Aztec expects to delineate more resources from continuing exploration. The study took no account of this additional potential, but it is worth noting that resource estimation has started at Acacia East following a drilling programme; three holes at Mangrove prospect have identified similar high grade hematite over a strike length of 650 metres with widths of up to 15 metres; and there are additional targets yet to be tested. Actual ore reserves total 22.16 million tonnes at 64.6% Fe spread over three deposits and there is a significant quantity of inferred resources in the optimised pit designs, particularly at Main Pit. This will be upgraded as in-fill drilling of the inferred resources at Main Pit confirms the continuity, width and grade of this high grade hematite and it is a safe quess that the same will be true for the other deposits. The feasibility study was based on a progressive ramp-up of production with a mix of 70 per cent fines and 30 per cent lump. 2 million tonnes is expected in the first year from mid 2006 onwards, 2.5 million tonnes in the second and thereafter it should settle at 4 million tonnes/annum. The prices used in the study were based on 2005 rates with reductions of 15 per cent forecast in 2008/9 and a further decrease of 10 per cent the following year. Presumably this reflects the MOU's reached with Chinese and Japanese customers for an offtake of 3.4 million tonnes of iron ore/year." With this agreement under his belt Ian Burston should not find too much difficulty in raising the initial capital costs of A$108 million which includes mine development costs of A$26 million. In support is the internal rate of return of 39.7 per cent before tax, and operating costs of A$30/tonne of ore giving an EBITDA of A$20/tonne, which together should enable a significant amount of the funds to be raised by an equity placement. Ian Burston is now going on a short holiday so far away from Australia that he will not be bothered by the results of the next Ashes Test, but in the meantime his team will be beavering away with detailed engineering design of the jetty shiploader, crushing plant and ancillary infrastructure as well as the environmental review required prior to development and mining approvals. The jetty will be just under 300 metres long and the travelling ship loader will have a capacity of 4,500 tonnes/hour which is sufficient for a 200,000 tonne ship The company has A$17 million in the kitty and no debt so it does not have to hang around waiting for development finance. You are never home and hosed in mining until product has been delivered and a cheque received, and even then a geological, plant or weather problem can put a dent in things. Aztec's operation, however, is more straightforward than most though the Sumitomo deal has still to be formalised and talks are in progress with other Japanese and Chinese buyers for the balance of production. There could be a sticking point in negotiations with the traditional owners, but this should be sorted through a Tribunal without having any significant impact on the feasibility study. The question that now has to be answered is whether the company will still be independent when production actually starts. Fidelity Investments announced at the beginning of this month that it had sold 7 million shares to bring its holding down to below 4 per cent of the equity. This had an inevitable impact on the market capitalisation which, at around A$86 million is way below the NPV of A$217 million at a 10 per cent discount and before tax and interest. Someone must have bought these shares and may well be building up a holding prior to making a bid for what is now very clearly an excellent project. The race is now on to see whether investors take the point and climb on board to raise the ante, or watch more of Australian minerals fall into possibly foreign hands as happened with Portman when taken over by the US company Cleveland-Cliffs. |
Posted at 24/6/2005 12:48 by biswell SP now standing at Feb high, if it breaks above 10p then a gap up to 12p is my call.If the Feasability study comes in + , and I expect it will, (and so does Byrne), then I see this share going to circa 24p in 3 months from now. This is not a ramp, it is based on IVW,WTN and CBM performance in the good days, when they were discovered by investors that had not heard of them before. In the UK AZR is a virtual unknown......Byrne has been keeping it that way. B |
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