www.stratexinternational.com
Stratex International is an exploration and development company focusing on gold and high-value base metals. The company objective is to be a leading-edge and innovative explorer whilst creating revenue from gold and base metal production via well-managed joint-ventures.
Since formation, Stratex has rapidly amassed a portfolio of high-potential exploration licences in Turkey and Ethiopia, primarily focussed on gold.
Stratex International set for boost from drilling results, says broker
Drilling results due soon from Stratex International’s (LON: STX) Blackrock and Öksüt projects should give a boost to the explorer’s value, says broker Northland.
Results for holes 52-57 at the Öksüt project in Turkey are expected in the coming weeks along with an updated resource estimate, said Northland.
Assay results from the Blackrock project in Ethiopia are also expected during the first three months of 2012 and management believes these could define some good grades, according to Northland.
The house broker said that a call with management had given it confidence that the key exploration projects are on track to deliver encouraging results.
The development assets are also broadly on course to deliver near term cashflow towards the end of 2012 and early 2013, it added.
Öksüt currently has a resource of 222koz gold in an oxide zone and 76koz in a sulphide zone but recent exploration success suggests a likely extension to the resource, said the broker.
Centerra is Stratex’s partner in the project and has an option to increase its stake to 70% by spending a further $3 million on exploration over the next two years.
Elsewhere in Turkey, Stratex has respective joint ventures with Turkish companies NTF at Inlice and Bahar at Altintepe for gold.
It also recently signed a heads of agreement with an as-yet unnamed new partner to develop the Muratdere copper-gold project in Turkey, while there are exploration ventures with heavyweights Teck for gold and Antofagasta for copper.
The assays at 95% owned Blackrock will be the explorer's first drilling on the prospect following bonanza grades revealed by surface sampling last year.
A recent attack on tourists 40km from the Blackrock deposit has raised the issue of security close to the Eritrea border, but the company told Northland the Ethiopian military has increased its presence in the region as a result and it regards the attack as an isolated incident.
Northland has a 13.3p target price for Stratex, which consists largely of the interests based in Turkey.
It attributes a value of 2.7p currently for the East African prospects that include Blackrock and also the Afar project, where Thani-Ashanti is the partner, and also the recently acquired Silvrex acreage in West Africa.
Stratex and Thani-Ashanti are currently reviewing results from the Megenta drilling program at Afar and planning follow up drilling for this year at the project.
The upside case based on a major Afar or Blackrock discovery is 18.4p, the broker added.
Northland added its valuation will also likely to be revisited once Öksüt results are pubished as it expects them to be positive.
“Development at the Inlice and Altintepe projects is expected to lead to production sometime during 2013, subject to outcome of Bahar’s diligence and technical studies, and drilling results expected shortly from the Blackrock and Öksüt projects, are potential positive catalysts for Stratex’s share price. We reiterate our price target at 13.3p.”
