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In the news: Panthera Resources, KEFI Minerals & Base Resources

Published: 09:52 23 Apr 2018 BST

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FROM THE BROKING DESK

PANTHERA RESOURCES* — LICENCE GRANTED IN MALI

Panthera Resources (PAT LN : 14p | Speculative Buy) has announced that an exploration licence has now been granted over the 27km2 Bassala Project area in Mali. This will allow it to follow up previous exploration on the licence area that outlined a number of geochemical anomalies and also demonstrated that gold mineralisation extends into bedrock. The licence hosts a large number of current and former artisanal mining sites, and was the subject of exploration from 2004-07. Previous exploration included some wide-spaced geochemistry and also two-and-a-half lines of RAB drilling that tested a number of geochemical anomalies. The company now plans a programme of infill geochemical sampling that will help guide future programmes.

We continue to await further news regarding the grant of the Prospecting Licence over the Bhukia Project in India. At Bhukia the company is targeting the discovery of a +6Moz gold resource based on historic drilling results. In January 2018 Panthera announced positive legal developments in the High Court of Rajasthan, after which the court directed the Government of Rajasthan to take a decision on the grant of the PL, preferably within three months. Our 40-page initiation report can be viewed here.


KEFI MINERALS — REPORT PUBLISHED

We have a piece out KEFI Minerals after it put out a couple of announcements: KEFI Minerals — Progress Update, 20 April 2018. The company is targeting the completion of a funding package for its Tulu Kapi Gold Project in Ethiopia in 3Q18, allowing first gold production in late 2020. Through a combination of a debenture issue, deferred payments and selling down an interest in the project, it aims to eliminate the requirement for it to contribute equity to its development. Once funded, the company intends to recommence exploration in both Ethiopia and Saudi Arabia.

We reiterate our Buy rating and have revised our target price down from 6.8p to 5.0p. We have reduced our target price after adjusting our model to reflect updated financing assumptions. Our SoTP valuation includes a value of Tulu Kapi based on its NPV8 assuming a long-term gold price of US$1,300/oz and a risk multiple of 0.75x. We also include estimated values for the potential value of the Tulu Kapi underground and future G&A costs.


Base Resources* — REPORT

As we’re mentioning the KEFI piece, it’s also worth highlighting this: Base Resources — March Quarter Activities Report, 18 April 2018. Base’s latest quarterly reflected yet another strong operating performance from Kwale in Kenya and a positive outlook for product pricing. The acquisition of the Toliara Sands Project in Madagascar was completed in January, with project guidance set to be announced by the end of September. We maintain our Buy rating and target price of A$0.62.

 


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