African Eagle Resources: Dutwa project puzzle coming together

African Eagle Resources' (LON:AFE) appointment of two new directors today ends a busy week of activity as it moves its Dutwa nickel project nearer to bankable status.

It had also hired two specialist companies for vital roles in the preparation of a bankable feasibility study (BFS) for the Tanzanian project, due at the end of this year.

The appointment of finance expert Don Newport and resource specialist Dr Christopher R. Pointon as non-executives was welcomed by Ocean Equities analyst Christopher Welch, who said it demonstrated the potential quality of the firm's flagship project.

"The attraction of such high calibre individuals to African Eagle supports our view that Dutwa is one of the best nickel projects in the current development pipeline," he said.

"There has been a marked change in the management team at African Eagle over the last six months, following the appointment of Trevor Moss as the new CEO," he said.

Welch said Newport will be able to assist in financing the construction of Dutwa, while Pointon's steel materials supply and nickel production experience will augment Trevor Moss and Aidan Schoonbee’s African mine project development expertise.

African Eagle has streamlined the BFS so it can be completed within 12 months, while Schoobee will now marshal the feasibility study’s consulting team.

World leading metallurgical and engineering consulting  firms have been engaged. Lycopodium Minerals will be the engineer to complete the (BFS) for Dutwa, while SGS Metallurgy Laboratory will be responsible for the pilot test programme - an essential component of that BFS.

Last week, African Eagle told investors it had selected atmospheric tank leaching as the metallurgical process method for recovering ores at Dutwa after it decided against the heap leaching process.

Welch likened the hiring of Lycopodium, the preeminent EPCM (engineering, procurement, and construction management) contractor in Tanzania, to the last 'big piece of the puzzle' in completing the feasibility study on Dutwa.

And following Wednesday's statement that the SGS laboratory had been chosen to test the Dutwa ores, the Ocean Equities’ analyst said Trevor Moss was now bringing his experience to bear as a mine builder to get the development of Dutwa on track.

"African Eagle’s market cap at just £22m belies the value of the world class nickel asset in its portfolio so we see little downside risk to its share price and expect the share price to rise as the development momentum continues to build," he said.

Analyst Sam Wahab, at broker Seymour Pierce, which rates the stock a 'buy', added that while the recent releases are not in themselves price sensitive, they did prove the company continued to move forward with the development of its 99 million tonnes at 0.93 per cent nickel resource.

The broker targets a price of 20 pence for the stock.

As at 3.45pm, African Eagle shares were trading up 2.33 per cent, at 5.50 pence each.