The price action over the last couple of days is very, very similar to that which occurred in the days prior to the announcement of significant uranium mineralization found from the Heathgate drilling results…
I suspect that the insiders are buying again with knowledge of the latest results found after the continuation of the drilling program
I urge HC readers to look at GIR’s last announcement and compare the land they hold to that of Alliance Resources (AGS). The latest drilling done by Heathgate was along the same path as the high grades of uranium that were discovered on AGS’s land at Four Mile….
As the company noted in its last announcement, the drilling Heathgate performed was unable to reach the basement of the rock where all the high grade uranium was found on AGS’ land. When I last spoke to the company, they were very excited that similar grades would be found, as current results indicate very, very similar characteristics to that of AGS’…
What I found more interesting, however, was that the company was more excited about the prospects of Deep South, where Heathgate has just extended its MINING PERMIT (note: not exploration permit), RIGHT UP TO THE FENCELINE of Giralia’s land…. The management at GIR considers this to be more prospective than the latest drilling results. The significance of this Deep South prospect should not be underestimated….
In addition to the long term uranium play that GIR offers, the company is going to announce the capital structure of its Zinc spin-off in early January. From what I have been able to gather, the structure of Zinc Co Australia will be more tightly held than that of Red Hill Iron (listed at 20cents, now @ $1.60) and will benefit GIR shareholders in a greater way as the Zinc Co assets are 100% owned by GIR, whereas RHI’s assets were not. GIR shareholders will receive free shares in this Zinc Company, plus priority entitlement to the IPO. The Zinc Co is likely to be market capped at about $6m to$8m, which is very tight.
The quality of the zinc assets also are high grade. They were acquired by director Mick Clifford in the 1990s – at times when no body wanted zinc assets. Mick had a liking to Zinc back then (and even now), therefore, he picked up some high quality assets when nobody wanted them. Now that Zinc prices have increased, these prospects become economic to explore and mine. The dedicated Zinc Company will focus its attention on these prospective tenements.
Other points worth mentioning are:
Firstly: GIR’s Snake Well gold project is likely to go into production in late 2007 which will produce some cash flow for the company. I anticipate that gold prices will be much higher in 2007 and 2008 (over $US800oz) so the company will benefit from these. For the record, I am currently long gold futures at $591oz – so I do have an interest in that.
Secondly: GIR is a company which amassed a huge amount of ground when resource prices were rock bottom. Therefore, the company has the tenements to justify a further two spin-offs. One dedicated Nickel company and a second iron-ore play. I actually became interested in Giralia as it had great tenements around Jubilee’s massive Cosmos Nickel mine. I know that the board is seriously considering the spin off of the Nickel company, and is giving thought to the second iron-ore play.
The reason for spinning out these assets, is not due to the company trying to cash in, but rather is aimed at maximizing shareholder value, by establishing dedicated companies that can put in the financial resources and people resources into advancing the projects. There is too much land on the go for GIR to manage on its own, therefore, the company is doing the right thing by its shareholders in spinning out its assets and maintaining an interest in the new companies.
When you compare the market cap of AGS (approx $450m) and that of GIR (approx $100m), you can clearly see that there is a massive amount of upside.
My point of all this is not to ramp this stock up…. I have got my fill, and am now carrying a free interest in the company. The point of my posting is to help HC readers, and ask them to do the homework and research this company, as you will find many treasures indeed. If anyone has any further useful information, I would love to hear it also.
Cheers,
P.T.
GIR Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
