Frustration for nearologists Garimpeiro By Barry Fitzgerald August 1, 2005
Good luck to South Australia's solo explorer, Rudy Gomez, with his Carrapateena copper-gold discovery, hard up against Lake Torrens and to the south-east of BHP Billiton's monster Olympic Dam operation.
Part funded by the South Australian Government's Plan for Accelerated Exploration, Carrapateena returned an impressive 67 metres at an average grade of 3.03 per cent copper and 0.4 grams of gold a tonne.
Now one hole does not make a mine. And the zone was not at a friendly depth either (476 to 543 metres). But given it is in a province that is already home to Olympic Dam and Oxiana's Prominent Hill project, the first-up result is as good as it gets.
No wonder the phone at Gomez's privately-held RMG Services has been running hot since the SA Government announced the find last week.
With the required amounts for follow-up works beyond the reach of tiny RMG, a float or a joint venture with a listed company is on the cards.
If RMG was a listed company its shares would have gone for an almighty run. But it's not, leaving those who like a flutter on explorers to chase down the next best thing - companies with nearby tenements. At this stage, there is not a lot for "nearologists" to chase down. Gomez has the ground to the north and south tied up.
Excluding RMG, only 11 other companies with ground positions would be of interest to the nearologist investor.
Make that 10 after excluding BHP Billiton, which is too big for Carrapateena to have any share price rub-off effect.
Make it nine after taking out French nuclear giant Cogema, which is prowling SA for the next big uranium deposit.
It comes back to eight after taking out the Canadian listed uranium group, Southern Cross Resources, unless maple leaf stocks take your fancy.
The listed companies in the final eight are David Harley's Gunson Resources, Derek Carter's Minotaur Exploration, Havilah and Argonaut. All their share prices got tickled along after news of the discovery.
The last four are unlisted - the Sydney-based and Martin Place Securities-backed Uranium Exploration Australia, Melbourne-based diamond explorer Orogenic, Sydney-based International Base Metals and Adelaide's Monax Mining.
As luck would have it, three of that bunch - UEA, IBM and Monax - were known to be planning listing on the Australian Stock Exchange before the Carrapateena announcement. Their task just got a whole lot easier thanks to the copper strike by Gomez, although UEA might like to consider a name change to Uranium and Copper Exploration Australia.
Monax is the more advanced in its float plans while, among the listed groups, Gunson will be drilling its Chianti and Moseley Dam copper prospects in September.
Carrapateena is 19 kilometres east of the north-eastern boundary of Gunson's Mount Gunson tenements and its granite rocks are similar in age and alteration-style to Chianti.
GIRALIA Resources NL is the owner of one of the biggest exploration land banks you are ever likely to see for a company of its size, with its Snake Well gold property in Western Australia the most advanced of the bunch.
While Snake Well moves through the prefeasibility study stage, Giralia Resources has turned its attention to extracting value from the rest of the land bank.
And shareholders couldn't be happier as, under the first deal, they are to get an in-specie distribution of 40 million shares in a revitalised and redirected Pacific Magnesium Corporation.
Giralia's land bank also includes iron-ore and uranium interests that could be bundled up in a similar way, raising the prospect that for each piece of Giralia paper, shareholders could end up owning four pieces in well-funded and project-specific explorers (Giralia, PacMag, iron ore and uranium).
A former magnesium hopeful, PacMag is to acquire a package of four copper-gold projects from Giralia's land bank by a combination of outright purchase and joint venture.
The package includes the Ann Mason porphyry-style copper deposit, estimated in the 1970s to contain around 4.4 billion pounds of copper, and an option to earn an initial 51 per cent of Giralia's Blue Rose copper-gold prospect in South Australia.
The consideration is 50 million PacMag shares after a 1-for-12 consolidation. Giralia shareholders get 40 million of those (one PacMag share for each 3.4 Giralia shares held) while Giralia keeps the rest, giving it an 11 per cent PacMag stake.
Rounding out the picture is the appointment of Mick Clifford as the new PacMag director and a planned capital raising by PacMag of $3 to $5 million. Clifford was formerly regional exploration manager Australia for AngloGoldAshanti, making him some catch in an industry running short of know-how.
Giralia will also take board control, leaving only Emmanuel Althaus to represent existing PacMag shareholders, who end up with about 21 per cent of the action. Better that than 100 per cent of some no-hope magnesium metal dreams.
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