www.solgold.com.au
Solomon Gold was listed on the London Stock Exchange (AIM code : SOLG) on 10 February 2006.
Solomon Gold is headed up by experienced and committed mining industry professionals with demonstratable track records of mineral discovery and providing valuable shareholder return. The Board of Directors include accomplished professionals with experience in exploration, mine development, investment, finance and law. The Board and Management have significant vested interests in the Company, holding approximately 17.5% of its issued share capital. The Company currently has 284,623,489 shares in issue.
Solomon Gold has Exploration tenements in Queensland, Australia and the Solomon Islands.
Solomon Gold's Rannes project could transform it from explorer to miner - Fairfax
Solomon Gold (LON:SOLG) could be transformed from explorer to miner in relatively short order if the Rannes project goes to plan, according to research by its broker Fairfax Securities.
This morning the company announced a resource upgrade for the Rannes project, taking the resource a fifth of the way to its 2 million ounce target.
It announced a maiden 203,000 ounce gold resource for the Kauffmans prospect. The total resource at the Rannes project - which comprises a series of prospects in central Queensland - has almost doubled to 404,000 ounces.
“Today’s resource announcement is a substantial step forward and marks the potential for economic mine development,” Fairfax analyst John Meyer said in a note to clients.
“Investors are now seeing strong progress both in Australia and in the Solomon Islands with the promise of more to come.”
In the Solomon Islands the company has a number of projects, the most advanced are the joint venture with Newmont Mining (NYSE:NEM) on Guadalcanal and its wholly-owned exploration project on Fauro Island.
With a particularly bullish take on Solomon’s ongoing development Meyer said: “While many explorers are slow to progress a rare few appear to make progress on all fronts. We wonder if the team at Solomon ever sleep when looking at the results and progress being made.”
Meyer adds: “If every exploration company was as driven as Solomon Gold then the world might not suffer commodity shortages and there would be much less opportunity for investors.”
Indeed the company has a very busy calendar at the moment.
On Guadalcanal Newmont kicked off a new drill programme earlier this month. The programme will include 5,600 metres of drilling and it will cost Newmont, who is earning into a 70 percent stake, around US$6 million.
Meanwhile at Fauro, the project that sparked a 100-plus percent spike to the shares on surface sampling results last year, a 9,900 metre drill programme is also underway. Early drill results from the first hole have already confirmed a down-dip extension of gold-bearing veins that were outcropping in surface trenching.
Now following this morning’s resource update Solomon plans to carry-out geophysical surveys at Kauffmans to select near-term drill targets.
The Rannes project is made up of three main areas: Rannes Central, Police Camp Creek and Brother & Cooper.
The Crunchie, Homestead and Kauffmans prospects are more advanced parts of the Central Rannes area, which also includes the Cracklin Rosie and Porcupine Pie prospects.
“Step-out drilling from known gold mineralised zones, are planned with a view to increasing the resource in the Central Rannes Area. Porcupine Pie, Crackling Rosie and Shilo are the prime new resource targets,” Nicholas Mather said.
At Kauffmans, Solomon has now defined an inferred mineral resource of 7.7 million tonnes grading 0.82 grams per tonne gold equivalent, for 203,000 of contained gold equivalent. Furthermore it highlights that there are multiple prospects that are in close proximity to Kauffmans that provide ‘excellent potential’ for a significant expansion to the existing resource.
“The Kauffmans prospect should be mineable by open cast making the mining simpler and it is possible that a strike length of some 1.5km may emerge if mineralisation joins with Homestead and Shilo gold prospects nearby,” Meyer said.
“Management are targeting an ambitious 2 million ounces resource within the Rannes prospect area which if economically mineable could transform the company from explorer to miner within relatively short order.”
The analyst rates Solomon as a ‘buy’, although with so many moving parts he said it is difficult to give the company a formal valuation.
Meyer told Proactive Investors that he believes the new Kauffmans resource is worth around US$20 million at this stage, by giving a US$100 an ounce for the 203,000 inferred ounces of gold - although he acknowledged that this may be a slightly forward looking.
This morning the shares gained a modest 1 penny a share, about 3.6 percent, to trade at 28.75 pence a share. At this level the entire company is worth just over £81 million.
