Bernier has 27 years of applied geoscientific research and project management experience.
Currently, he is a senior geoscientist for Chibougamau-based Table Jamésienne de Concertation Minière (TJCM) at its applied research division.

From 2009 to 2011, Bernier acted as senior mining industry advisor to Makivik Corp., an organization that protects the economic rights and interests of the Inuit of Nunavik.

Since November 2010, he has also acted as senior technical advisor to Focus on the Lac Knife graphite project, and for the review of new business development opportunities.

In addition, Bernier is a director of Majescor Resources (CVE:MJX) and its unit Simact Alliance Copper-Gold.

He is a registered geoscientist and practicing member of the Ordre des géologues du Québec. Bernier also has a Bachelor of Science Honours degree in geology from the University of Ottawa.

"Marc-André brings to the board a wealth of experience in applied geoscientific research and mineral exploration project management,” chief executive Gary Economo said in a statement.

"I am delighted Marc-André will be joining our leadership team at Focus, where I am confident he will make a valuable contribution to the next phase of our company's growth and development strategy."

Last month, the miner announced it acquired 65 claims in south-western Quebec from vendors for $60,000.

The claims, which are all natural flake graphite prospects, including a past producing property, are located on five properties within the Gatineau – Bois Franc area.

Prior exploration work reported the prospects are hosted in quartzite and consist of graphitic and massive graphite veins and veinlets. Graphite flakes are large to medium size, the company added.

The company will pay vendors 100,000 common shares of Focus Metals.

Focus Metals is an emerging mid-tier junior miner. It is the owner of the highest-grade 16 percent technology graphite resource in the world. Its aim is to be a low-cost producer of technology grade graphite.

It holds a 100 percent stake in the Lac Knife, Quebec property. The concession, some 35 kilometres south of Fermont, Quebec, is in the pre-development state with infrastructure, surface mining and primary processing site construction planned for completion next year.

Graphite is used to make brake linings, lubricants, and molds in foundries. A variety of other industrial uses account for the remaining graphite consumed each year.

Earlier this month, the company released the results of a feasibility study on the Chandgana Mine-Mouth power plant project, which is to be built next to the company's Chandgana Tal coal deposit from where coal will be supplied.

Construction of the power plant project, which is estimated to have 30 years of commercial operation, is planned to start in April 2013, with the first 150 MW unit being commissioned in October 2015.  The remainder of the units are to be rolled out in April 2016, October 2016, and April 2017.

The study projected an after tax internal rate of return (IRR) of 21.9 percent from the project, and a net present value of US $364.7 million, assuming a discount rate of 12 percent, and a debt interest rate of 10 percent.

The company said Tuesday that in the past three months, four Chinese EPC companies have reviewed the project data, and conducted site visits in Mongolia, while several other international companies have also expressed a written interest in bidding for the contract.

Prophecy expects to have key EPC proposals by March 31, 2012, with the company expecting to have picked a firm by the second quarter. The EPC firm is also expected to bring in a lender for debt financing, the company said.

With regards to the power purchase agreement, the company has been in close talks with the Mongolian Ministry of Natural Resources and Energy for the signing of the deal since Prophecy obtained the power plant construction license last November.

This month, a working commission on the power purchase agreement was constituted, and endorsed by the Minister, with both the company and the commission working together towards a deal. The aim is to have the power purchase agreement and the EPC contract selection finished at the same time.

Separately, Prophecy has met with Chinese government-sponsored policy banks involved in Mongolian projects for project financing, as well as private equity firms focused on international energy production projects.

The company also expects interest in the project from institutional investors. Prophecy said that once a power purchase agreement is signed, it anticipates being able to secure the necessary equity funding this year to move the project towards construction in the second quarter of 2013.

Under the feasibility study for the power plant, it was projected that coal will be supplied by the Chandgana Tal deposit, which contains 140 million tonnes of measured coal, at a steady rate of 2.7 million tonne per year, with the delivered coal price set at $15.50/t with a 2 percent semi-annual price increase.

The electricity tariff is targeted at US $0.06/kWh, with a 2 percent semi-annual increase.

Capital cost is projected to be US $744 million for the 600MW project, or US $1,240 per kW. This includes the power plant, overhead transmission lines, and administrative costs, the company said, but excludes mine development costs.

The company's coal resource is next to a two-lane highway and 150 kilometres from the existing power grid.  Once power and the mine are brought online, there is good potential to introduce additional plant units at lower capital costs, it added.

Prophecy Coal is a Canadian company that has over 1.4 billion tonnes of surface minable thermal coal resources on two coal properties in Mongolia. Its Ulaan Ovoo coal mine is in production and its Chandgana mine mouth power plant has been permitted.

Rainy River's June 2011 NI 43-101 resource estimate shows a measured and indicated resource of 4.41 million ounces of gold averaging 1.17 grams per tonne (g/t) gold, in addition to an inferred resource of 2.33 million ounces of gold averaging 0.94 g/t gold.

In this resource estimate, Rainy River considers the material above the final depth of the conceptual pit shell (450 metres vertical depth) offers reasonable prospects for economic extraction from an open pit, using a cut-off grade of 0.35 g/t gold.

Recently, Bayfield reported that a wide shear zone is now in the initial stages of exploration on the far east portion of the Burns Block. This zone is the easterly strike extension of the main ODM17 gold target that hosts Rainy River's deposit as well as the zone that hosts Bayfield’s high grade gold and silver mineralization 700 metres to the west.

Bayfield’s CEO, Jim Pettit, told Proactiveinvestors that the Burns Block is basically a rectangular block in the middle of Rainy River's property, and since 2010, Bayfield has completed about 70,000 metres of diamond drilling from the western border heading east, and is budgeted for another 30,000 metres of drilling in 2012.

The aim of the campaign, said Pettit, is to explore and expand the extension of gold and silver mineralization that is being defined by Rainy River on its ground adjacent to Bayfield's claims.

Early on in the 100,000 metre program at the Burns, hole RR10-15 tapped into a high grade gold and silver shoot and returned 31.71 g/t gold and 50.23 g/t silver over 3 metres at 160 metres below surface right beside the western border.

The company quickly followed up this result with hole RR10-18, which returned 35.93 g/t gold and 360 g/t silver over 10 metres.

Drilling on Burns Block was halted for a break over the holiday season, but has since resumed with exploratory drilling of mineralization initially discovered at surface in 2010 on the eastern portion of the Burns Block.

Earlier this month, the company reported assay results from this program that conclusively showed that structurally controlled gold-silver mineralization continues for at least 700 metres from west to east across the Burns Block property. Much more infill and definition drilling is planned along this strike length.

Initial wide-spaced drilling in the eastern portion of Burns Block has intercepted multi-gram gold assays, including values up to 5.58 g/t gold and 32.87 g/t silver over 1.9 metres.

Pettit said he believes that more detailed drilling in this eastern area has an "excellent chance" of intercepting richer assay results once key high-grade mineralized structures are identified.

In late 2010, surface mapping and sampling found that mineralization underneath the till cover on the western portion of the property was widely exposed at surface in an outcrop on the eastern side of the Burns Block, leading to further exploration and drilling in 2011.

Much like the western portion of the Burns Block, Bayfield is defining a lower grade envelope that could encompass much higher grade gold and silver zones at depth over to the east, the company said.

The potential for this is seen with one of the latest holes, RR11-205, which intercepted a 22.0 metre wide zone containing several distinct zones of gold mineralization in the range of 1.74 to 5.58 g/t gold, along with silver values up to 34.30 g/t silver.

Also in the northeast quadrant of the Burns Block, hole RR11-202 returned 3.00 metres of 2.56 g/t gold and 9.00 g/t silver as well as 1.50 metres of 4.08 g/t gold and 9.80 g/t silver.

Indeed, Bayfield said gold and silver values are getting richer at depth, and approximately 500 metres of the down plunge distance within the south-dipping shear zone is unexplored.

In November, Rainy River Resources released a preliminary economic assessment on its property, with plans for a combined open pit and underground operation, with a planned underground decline development looping right around the Burns Block property.

The report, which looked at mining operations over 13.2 years, estimated a life-of-mine net present value of $786 million using a $1,200 gold price, a $25 silver price and a discount rate of five percent. It also reported a 19.4 percent internal rate of return and a payback period of 3.4 years.

Pettit noted though that Rainy River's initial mine plan is "very cost-sensitive" because of the lower grades, with a mill head grade of 0.7 g/t gold, an open pit cut-off grade of 0.30 g/t gold and an underground cut-off grade of 2.0 g/t gold.

Pettit suggested that as a result of this sensitivity, underground mining is planned to hit pockets of high grade below the pit to enhance the initial economics of the mine. He added that this underground mining could target some of Bayfield’s high grade zones that are “very rich in grade” and are located near to the initially proposed underground workings in Rainy River’s 17 East Zone.

Life-of-mine average annual production for the Rainy River gold project is currently projected at 329,000 gold ounces and 497,000 silver ounces, with production anticipated to start in the second half of 2015.

The ODM17 gold zone, which extends onto the Burns Block near surface, is the first zone to be fed into the proposed mill, according to Rainy River's mine plan, added Pettit.

Pettit went on to note that another potential benefit of owning the Burns Block property is the "nice, big" outcrop located on the asset, "ideal for Rainy River's needs for constructing a mill", he said. An outcrop is an area of visible bedrock that is not covered with soil and it offers hard, stable ground as most of the district is quite boggy.

The Burns Block property can be accessed through numerous all-weather, secondary provincial highways and township roads, which lead off of paved provincial highways 11 and 71. The project therefore has good access to labour and equipment.

Aside from Burns Block, which accounts for around 99 percent of Bayfield's asset value, the company also holds the B Block and the C Block properties in the Rainy River district, which constitute "blue sky" exploration potential for the company.

Diamond drilling is now underway on the 1,976 acre C Block property situated to the west of Rainy River Resources' deposit, an area that has never before been drilled.

Around 3,000 to 3, 5000 metres of exploratory drilling is planned at the C Block, with the aim of establishing the character of the bed rock across the under-explored property. The vast majority of the asset is covered by glacial till deposits, necessitating a drilling technique called overburden drilling, which uses a reverse circulation drill, to establish gold targets for diamond drilling.

Drill targeting is also being guided by the results of ground magnetic surveys completed in 2007, and by the results of helicopter VTEM and magnetic surveys flown for Bayfield in late 2010.  Bayfield said the geophysical data is similar to that collected from its Burns Block and B Block properties, as well as the area hosting Rainy River’s deposit.

At the 1,185 acre B Block, around 2,500 metres of drilling is planned. In 2008, Bayfield drilled 2 metres of 5.84 g/t gold in the south-central portion of the B Block, with the mineralization lying within 200 metres of the surface.

Bayfield, with just under $4 million in the treasury, said it is fully funded through the balance of its exploration plans, and doesn't expect the need for more money via a financing.

Pettit, who has more than 15 years of experience managing junior resource companies, is confident with his exit strategy plans for the company given the drilling and exploration that has been done to date.

Aside from Pettit, Bayfield's management boasts president and director, Donald C. Huston, who has over 25 years in the mineral exploration industry, having been an in-field manager for several projects in North America.

Bayfield's stock has risen nearly 28 percent since the start of 2012, currently changing hands at around 61 cents, suggesting a takeover may be in the works.

In early January of this year, Doug Casey’s International Speculator refreshed its "buy" rating of Bayfield Ventures, noting that the company's bulk-tonnage lower grade mineralization in addition to higher grade drill results continue to add value to the Burns Block property, and that whatever the size of this new area of mineralization to the east is, it simply makes a takeover more likely.

Each has attracted an incredible amount of interest. So if you haven’t signed up already, you really need to do so soon to avoid disappointment. Please click here to register for the event.

All the hard work is starting to pay off for mobile gambling specialist Probability (LON:PBTY), which is at the inflection point.

The latest results showed that sales are starting to take off, while the business came close to break-even despite significant increases in marketing spend, particularly on TV. 

A recent report by the City broker Numis suggested Probability would be a logical partner for Facebook as the social media giant seeks to boost its mobile revenues. 

Joining us to talk about this and all the other developments at Probability will be chief executive Charles Cohen.

Seeing Machines (LON:SEE) is an expert in the cutting edge arena of facial recognition. 

The technology is being used in a fatigue monitor for drivers, and is also an integral part of the world’s first 3D laptop.

However this is a fraction of its potential as Ken Kroeger will reveal when he joins us at the Chesterfield Mayfair Hotel. 

“There are so many uses for this technology,” he said in a recent interview.

“We are talking to all the big players in the handheld device space. There are some technical challenges there moving it to low output devices, but be if we can get there it will be big.

“If you can move it into an area where you are selling tens or twenty million devices – even at a fraction of dollar a time you are still talking a lot of money.”

Oxford Pharmascience (LON:OXP) is developing smart technology that could save its larger and more illustrious brethren millions a year in lost sales. 

Its suite of products allows medicines to be taken in various ways, which has the potential to create product extension for some the big over-the-counter and prescription drugs. 

“The model is changing for the big pharma companies,” said chief executive Nigel Theobald. He will be with us next Thursday to explain more.

Very rarely does a small drug company have the opportunity to do the same transaction twice – with every prospect of getting an even better deal the second time around. 

This is exactly what has happened with ImmuPharma (LON:IMM) and its leading drug Lupuzor, which is expected to attract the attention of the drug sector’s big boys.

“We expect Immupharma not only to re-licence Lupuzor sooner than the market anticipates (and this time with a big pharma company) but also that the up-front payment will be of a quantum that results in its enterprise value falling near to, or even below, zero,” said Navid Malik, analysts at Merchant Securities.

Bringing us up to date with events will be Dimitri Dimitriou.

Our investor forums are completely free to attend. Each company has approximately 30 minutes to give a short presentation and for Q&A. Please join us at 5:40pm to get yourself a seat and to allow for a prompt 6:00pm start. 

Following the presentations will be a complimentary bar and an assortment of the finest hot & cold canapes, giving you the opportunity to speak with the directors and other investors.

Exciting barely covers it. We have a line-up that offers something for everyone at the Proactive Investors One2One Forum in London next Thursday (February 9). We have ImmuPharma and Oxford Pharmascience presenting alongside Seeing Machines and Probability. 

Each has attracted an incredible amount of interest. So if you haven’t signed up already, you really need to do so soon to avoid disappointment. Please click here to register for the event.

All the hard work is starting to pay off for mobile gambling specialist Probability (LON:PBTY), which is at the inflection point.

The latest results showed that sales are starting to take off, while the business came close to break-even despite significant increases in marketing spend, particularly on TV. 

A recent report by the City broker Numis suggested Probability would be a logical partner for Facebook as the social media giant seeks to boost its mobile revenues. 

Joining us to talk about this and all the other developments at Probability will be chief executive Charles Cohen.

Seeing Machines (LON:SEE) is an expert in the cutting edge arena of facial recognition. 

The technology is being used in a fatigue monitor for drivers, and is also an integral part of the world’s first 3D laptop.

However this is a fraction of its potential as Ken Kroeger will reveal when he joins us at the Chesterfield Mayfair Hotel. 

“There are so many uses for this technology,” he said in a recent interview.

“We are talking to all the big players in the handheld device space. There are some technical challenges there moving it to low output devices, but be if we can get there it will be big.

“If you can move it into an area where you are selling tens or twenty million devices – even at a fraction of dollar a time you are still talking a lot of money.”

Oxford Pharmascience (LON:OXP) is developing smart technology that could save its larger and more illustrious brethren millions a year in lost sales. 

Its suite of products allows medicines to be taken in various ways, which has the potential to create product extension for some the big over-the-counter and prescription drugs. 

“The model is changing for the big pharma companies,” said chief executive Nigel Theobald. He will be with us next Thursday to explain more.

Very rarely does a small drug company have the opportunity to do the same transaction twice – with every prospect of getting an even better deal the second time around. 

This is exactly what has happened with ImmuPharma (LON:IMM) and its leading drug Lupuzor, which is expected to attract the attention of the drug sector’s big boys.

“We expect Immupharma not only to re-licence Lupuzor sooner than the market anticipates (and this time with a big pharma company) but also that the up-front payment will be of a quantum that results in its enterprise value falling near to, or even below, zero,” said Navid Malik, analysts at Merchant Securities.

Bringing us up to date with events will be Dimitri Dimitriou.

Our investor forums are completely free to attend. Each company has approximately 30 minutes to give a short presentation and for Q&A. Please join us at 5:40pm to get yourself a seat and to allow for a prompt 6:00pm start. 

Following the presentations will be a complimentary bar and an assortment of the finest hot & cold canapes, giving you the opportunity to speak with the directors and other investors.

Fission is engaged in the acquisition and exploration of uranium properties in Alberta, Saskatchewan and Quebec in Canada, as well as the Macusani District in Peru.

Versant has a "speculative buy" rating on Fission Energy with a $1.25 price target. Tuesday, Fission shares closed up 1.3 percent at $0.78.

Fission Energy's flagship Waterbury Lake project is located immediately west of Hathor Exploration’s (TSE:HAT) Roughrider uranium deposit, which is in the heart of a district that hosts over 110 million pounds of uranium.

Hathor was recently subject to a takeover battle in late 2011 between mining giants Cameco Corp. (TSE:CCO)(NYSE:CCJ) and Rio Tinto (NYSE:RIO)(LON:RIO), with the latter emerging as the winner with its $654 million friendly bid trumping Cameco's $625 million bid.

Fission's J East Zone at Waterbury is the likely western extension of Hathor's Rougrider deposit as the property line is the only thing separating the two, Versant noted.

J East is one of several pods of mineralization along a “string of pearls” formation that runs deeper from west to east and includes Fission’s Summit, Talkiser, J Zone and J East Zones as well as Hathor’s Roughrider, Roughrider East and Far East Zones.

In a research note, Versant analyst Rob Chang said: "Fission will soon release its initial 43-101 compliant resource estimate for the [Waterbury Lake] J Zone. The resource is expected to be between 13–23 million pounds of uranium. We estimate that it will be about 18 million pounds of uranium."

In terms of consolidation, Versant Partners said that with the recently completed battle for Hathor won by Rio Tinto, it is generally believed that Hathor alone is too small to significantly impact the bottom line for the mining giant.

"As such, the consolidation of Hathor’s neighbour that has the shallower mineralization is a likely subsequent step," Versant Partners concluded.

Other companies in the below $250 million market cap range included in Versant's top picks for the year are Mawson West (TSE:MWE), MEGA Brands (TSE:MB) and QHR Technologies (CVE:QHR).

Regency Mines (LON:RGM) this afternoon revealed drill results from the Mambare nickel laterite project, in Papua New Guinea.

The results confirm the significant grade and tonnage potential of Mambare’s Plateau zone, it said.

One of the drill holes returned the highest nickel grades encountered to date at the project, with 3.28 per cent nickel and 0.12 per cent cobalt being encountered in a 1 metre interval.

The company said that the Plateau area has never been drill tested before. It is an extensive area and it is the major target for future exploration, it added.

Regency believes it may potential to host one of the world's largest nickel laterites.

Mambare is being explored through a 50:50 joint venture, with Sydney based firm Direct Nickel Pty Ltd.

 The latest drill campaign was completed in December, and the remainder of the assay results are expected in the coming weeks.

Likewise, the factory orders data also surprised on the upside, showing a 1.1 percent improvement in December from November, taking the annual improvement to 12.6 percent from 2010.

US light, sweet crude for March delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), rose 62 cents to US$96.98/barrel in morning trade in New York.

March Brent crude tacked on US$1.18 to trade at 113.41/barrel on the ICE Exchange this afternoon.

Today’s top risers in the oil and gas sector were:

Caza Oil & Gas (LON:CAZA), up 15.5 percent at 12.44 pence at midday

Silvermere Energy (LON:SLME), up 9.5 percent at 15.9 pence

Amerisur Resources (LON:AMER), up 6 percent at 20.42 pence

Ohpir Energy (LON:OPHR), up 6 percent at 317.8 pence

Madagascar Energy (LON:MOIL), 5.5 percent at 26.94 pence

The top fallers were:

Gold Oil (LON:GOO), down 5 percent at 2.42 pence at midday

Woburn Energy (LON:WBN), down 5 percent at 1.78 pence

Sefton Resources (LON:SER), down 3.5 percent at 2.25 pence

Frontera Resources (LON:FRR), down 3 percent at 1.09 pence

Pantheon Resources (LON:PANR), down 2.5 percent at 10.35 pence

Sound Oil (LON:SOU) are one to watch for Monday, as in the previous announcement they said “Sound Oil has been advised by the Operator that the Cataka-1 exploration well on the Citarum PSC, Java, Indonesia has encountered unstable formation in the top hole section, necessitating a sidetrack. The sidetrack hole has already been drilled to the casing depth at 1,397 feet and the 13 3/8ths casing set and cemented. Now that this part of the unstable formation has been cased off, the well will drill ahead to the objective at 6,995 feet as originally planned. It is estimated that at least two additional weeks will be needed to complete operations beyond the planned 21 day programme.” Now that 2 week extension would lead us to Monday, so it would be surprise to see an update hitting the news wires at the very early part of next week. G ood, bad or ugly, we will watch eagerly.

Tullow Oil (LON:TLW) moved 3% better to 1475 in trading, after the company announced that it has signed two new Production Sharing Agreements, or PSAs, with the Government of Uganda covering the EA-1 and Kanywataba licenses in the Lake Albert Rift Basin, adding that it has also been awarded the Kingfisher production license. As a result of this signing, Tullow will now finalizes arrangements with oil companies CNOOC and Total for completion of the farm-down and the related transfer of monies as soon as possible.” Major resistance sits at 1475p, so any break and close above could get the chartists among us excited. Support looks to be around the 1400p area.
Serica Energy (LON:SQZ) has been catching the eye recently, as volumes have been very gradually picking up. The shares have been on a decent run from 20p to the current level of 25p, as investors align themselves ahead of what looks to be a busy period of updates for the company. An interesting extract from the Q3 results on the 14th of November was from Tony Craven Walker, the Chairman of Serica, who said “I believe that the potential of the Company's prospects will become apparent in the next few months as we prepare to drill our UK prospects in 2012 and also identify partners with whom we can exploit our very significant Atlantic Margin position." So could we be about ready for another update? We will be watching very closely for any updates here.

The volume in San Leon (LON:SLE) was huge yesterday, with just over 26 million shares changing hands. We will be watching the news wires to see if anybody reports a holding update to account for all that volume. Shares today were a little easier, but holders in the position are waiting for updates on a few wells. San Leon have been very vocal over the last few weeks with regards to updates, and the market is hoping the news flow continues.

Tower Resources (LON:TRP) continued to move better today, pushing 8% to 4.4p. Resistance around these levels will be the key area to watch for, as any break could get the retail investors active. Holders were still cheering the news that the company should be spudding a few weeks ahead of schedule. Possibly the news of the PSA in Uganda with Tullow Oil helped grease the wheels slightly, ahead of them spudding the Mvule-1 well in the country.

I have been speaking about Kea Petroleum (LON:KEA) for a while now, and Monday the company announced its 2012 drilling program will commence with the drilling of the Puka-1 well in onshore Taranaki, New Zealand permit area PEP 51153. Puka-1 is expected to spud within the next four weeks. Well will be drilled to a depth of 1,550 meters, with a slight lateral deviation, to test for oil in Miocene aged Mount Messenger Sands. Shares did move better on that news, and continued to rally yesterday. Kea also please holders by announcing it has selected Drillforce's Rig 1 for a 2 + 1 (optional) well program. The Rig is expected to be mobilized first to Kea's Puka-1 wellsite, located in Kea's onshore Taranaki, New Zealand permit area PEP 51153. Directors believe site preparations are progressing well and are on schedule for rig delivery to site on or around Feb. 15. So we will be watching for any updates around the middle of Feruary.

Amerisur Resources (LON:AMER) decided to have a delayed positive reaction to the operations update from Monday. The announcement highlighted that construction of road infrastructure at Platanillo block in Colombia is almost complete, and added that it has received approval for two new licenses within the Piriti and Pilar sedimentary basins in Paraguay. Civil engineering and construction of road infrastructure to the southern sector of the Platanillo block in Colombia is almost complete. It also said that the company is In final stages of negotiating a rig contract with an established Colombian Drilling Contractor for the upcoming six well Platanillo drilling campaign, with operations on track to spud the first well in March. Drilling campaign is targeting a production uplift to 5,000 BOPD by the end of 2012. Shares were 7% bett er at almost 21p.

Volga Gas (LON:VGAS) were a little better today, trading up 2% to 81p at the mid-price. Possibly one of the reasons this has just started to move is this paragraph from the last update back in October last year. “Urozhainoye-2 licence area, The Yu. Romanovskaya #1 exploration well reached its initial target at a depth of 2,885 metres where the Bo layer was found to be thinner than prognosed and without hydrocarbons. Having completed logging operations, drilling is to continue to the primary target horizon at a depth of 3,800 metres. The rig used to drill the top section of the well will remain on location to drill the deeper section, in an operation that is expected to take about three months.” So that would led us to believe the company could be updating the market sometime in February.

Mining

EMED Mining (LON:EMED) was the star performer in the mining sector gaining 17.5% by lunch, on well above average volume. The stock is now up over 20% since we commented last week that things appeared to be finally progressing on the permitting front at the 100% owned Rio-Tinto copper mine in Southern Spain. Local press this week has continued to  highlight the apparent unnecessary delays in the re-opening of the mine and it has certainly now become a campaign issue for the respective parties ahead of the local elections next month. With all parties seemingly now openly lending their support to the reopening of the mine, and a growing torrent of calls for the restart from the local populace, could we get some developments ahead of the elections to give the current government a shot in the arm before people head to the polls ? If Administrative Standing is granted expect a rerating in the stock.

Diamond companies have really been coming back in vogue the last few weeks, and Firestone Diamonds (LON:FDI) has been one of them. The stock jumped another 8% to 13.25p on steadily increasing volume. If the stock can break resistance at 13.5p, the next level of interest could be resistance at 15p. Scanning through the recent updates I found this little snippet “As indicated in the Preliminary Announcement, the Company intends to announce a summary of results of both production and diamond sales on a quarterly basis. The next update, which will be for Q4 2011, will be provided in Q1 2012.” So holders here should be in store for an update at some stage over the next month or so.

Another diamond company that is in focus at the moment is Diamondcorp (LON:DCP). Shares have been buoyant since the operations update at the end of January, and volumes today caught my eye. Shares were trading 5% better at 6.5p, which happens to be the first major level of resistance I can see. Should shares break and close above this level, 8p would seem to be the next area of resistance interest.

Beowulf (LON:BEM) jumped 20% to 13.5p by the end of lunch, on decent volume. Shares have taken a battering over the last 6 months due to permits being suspended at both its Kallak North and Kallak South permits. With volumes starting to creep better, along with the shares price, could holders here be in store for an update on these permits? We will be watching the news wires like hawks on this one.

Regency Mines (LON:RGM) another stock spoken about here over the last few weeks in anticipation of an update, jumped 15% to 2.2p in trading on decent volume, after the company announced positive assay results from recent drilling at the Mambare Nickel Laterite Project in Papua New Guinea. Highlights of the assay results include hole MAM-KK-0051 which has recorded the highest nickel grades to date at the project at 3.28% Nickel, 0.12% Cobalt from a 1 m interval from 15.95 m. These results confirm the significant grade and tonnage potential of the Plateau (Area 1) zone at Mambare. A close above 2p here would be a bullish sign, as that has been major resistance over the last few months. A break above that level could see the stock test old resistance at 2.7p.

Vane Minerals (LON:VML) jumped 17% to 1.3p in trading, on 13 times the average daily volume by the end of lunch! The shares jumped after the company said it has drilled a copper-molybdenum porphyry system at its McGhee Peak project in New Mexico. Drilling continues at McGhee Peak which is located on the Hillsboro-Chino-Tyrone-Bisbee porphyry mineral trend in southwest New Mexico. Two rotary holes completed with a third being re-drilled. Mineralised copper, molybdenum and zinc porphyry system encountered. Copper values in the range of 300 ppm, or parts per million, and 600 ppm. Zinc values greater than 200 ppm. First line resistance looks to be 1.5p, with previous resistance at 1.15p looking to act as support now.

Silverdell (LON:SID) jumped 7% to 12p in trading, on slightly better than the average daily volume by midday. The shares jumped after the company said that it has been awarded framework contracts for consultancy in the Utilities and Social Housing markets, with a combined value of GBP1.4 million, as well as an asbestos remediation contract worth GBP2.25 million. The company has secured a contract worth GBP1.1 million with a major energy supplier in the North of England. The company will carry out hazardous waste management consultancy and will conduct surveys across all of the customer's built assets within the region, working as a preferred supplier to the customer over a period of four years. Resistance at 12p looks to be the first area of interest here, with 13p looking to be major historical resistance.

Sunrise Resources (LON:SRES) a stock spoken about fondly here on a number of occasions, jumped another 18% to 1.9p in trading today, on almost 3 times the average daily volume by the end of lunch. Shares have been on a fantastic run of late, jumping from 0.88p to current levels. Resistance at 2p followed 2.5p are the next two levels to watch for here.

Condor Resources (LON:CNR) jumped 8% to 7p just before lunch, after the company reported drilling results from its La India project in Nicaragua, with results including a wide high grade gold intercept on the India-California structure on La India Vein Set including 4.19 meters true width at 6.94g/t, or grams a ton, gold from the California Vein and 7.37 meters true width at 6.31 grams a ton gold from the India Vein. The India Vein and California Vein are only 25 meters true width apart at this intercept, adding credibility to the potential for open pit mining. New 'Natalia' Vein intersected in drilling between the America and Guapinol veins with a best drill intercept of 8 meters drill width at 4.22g/t gold. Resistance at 7p looks to be the first line of interest, followed by head line resistance at 8p.

From the trading floor

After a very impressive set of US non-farm payroll figures, and an equally impressive unemployment rate, the FTSE 100 was 77 points better at the time of typing, at 5874 (+1.35%) well above the major resistance at 5820. A close above that level could mean a retest of major historical resistance at 6000. The FTSE AIM All-Share Index was 0..65% better on just over a billion shares traded as the US opened.

The UK service sector grew at its fastest rate since March 2011 in January. The Markit/CIPS Services purchasing managers index (PMI) increased from 54 to 56. Any reading above 50 in this index indicates growth.
Nonfarm payrolls were expected to come in at +160k, but smashed expectation and hit the wires at +257k. The main bullish point here was the unemployment rate that came in at 8.3% much better than the 8.5% forecast. ISM non-manufacturing came in better to cap off a great run for US economic data, hitting the wires at 56.8% versus expectations of 53.2%.

A nice bright spark to end the week on, with fewer personal insolvencies in 2011. There were 119,850 people declaring insolvency over the last year, the Insolvency Service said. That number was down 11.3% from the record high in 2010.

Commodities Corner
 
Gold – ↓Trading at $1749, down $11 (-0.59%)
Silver – ↓Trading at $33.95, down 27c (-0.77%)
Copper – ↑Trading at $8501, up $122 (+1.47%)
Zinc – ↓ Trading at $2129, down $42 (+2.02%)
WTI Crude – ↑Trading at $96.93 up 55c (+0.77%)
Brent Crude – ↑Trading at $113.86, up $1.79 (+1.61%)
Natural Gas (HH) – ↓ Trading at $2.48, down 7c (-2.81%)
 
FX

GBP vs USD = 1.5779
GBP vs EUR = 1.2053
        
Any questions please don’t hesitate to contact me at steve.asfour@fox-davies.com
Written by Steven Asfour, Sales Trader at Fox-Davies

Avocet revealed that it has doubled the gold reserve at the Burkino Faso mine, where it began production in June. This has been a well publicised target for the company.

At 1.85 million ounces. the mine’s gold reserve is now twice the size it was when the mining operation began, despite Avocet producing around 90,000 ounces of gold since then.

Additionally, Avocet said that Inata now has a total gold resource of 3.46 million ounces.

The upgrade had been widely anticipated and on the stock exchange, Avocet shares barely moved edging 1.35p, or 0.5 per cent, lower at 238.25p as share. 

The stock, which stepped up from the AIM market to a premium LSE listing in December, is up about 30 per cent since the turn of the year.

Oriel Securities analyst Kate Craig repeated her ‘buy’ recommendation on the stock following today’s announcement, however, she had already anticipated the reserve upgrade in her 289p share price target.

As a result of the reserve upgrade Avocet has effectively extended Inata’s mine life to 12.5 years.

This could be sufficient to trigger a proposed expansion to the mine, analysts said.

Attention will now switch to an upcoming scoping study which will assess whether an mine expansion could be economically viable.

"Inata’s reserves have now doubled since June 2011, which crucially means its mine life has extended to 12.5 years and meets a key goal ahead of the release of an expansion scoping study (due in the current quarter),” said Dominic O'Kane, mining analyst at Liberum Securities.

“A mine life extension should justify the green light for a proposed Inata expansion.” 

The firm has US$120 million of cash in the bank and, according to O’Kane, Avocet looks able to self fund its expansion.

“Conceptually we estimate c.US$363 million in earnings (EBITDA) in 2014 at current spot prices (producing 400,000 ounces gold with US$850 an ounce of cash costs) equivalent to a paltry 1.74 times Avocet’s existing US$634 million enterprise value (EV).” 

O’Kane says today’s reserve upgrade was another solid result for Avocet and he believes that recent exploration success will provide ongoing resource increases.

Meanwhile Numis analyst Andy Davidson told clients that all in all today’s upgrade was a positive update from ‘a company that continues to deliver’. Avocet remains one of Numis’ top gold pics.

Today, Avocet chief executive Brett Richards said: "The doubling of the Mineral Reserves at Inata was one of our key strategic objectives for 2011, not only because it demonstrates the significant potential of the deposit at Inata, but because it underpins our decision to continue investing in and growing the Inata Gold Mine and the surrounding Bélahouro District.”

“Entering 2012, we are now focused on completing the scoping study and delivering on this potential by expanding the mine to its optimal production capacity."

Monday morning, Tournigan shares were up 5.5 percent to $0.09.

The study gave Kuriskova a pre-tax internal rate of return of 30.8 percent, a 1.9-year payback period, and a net present value of $277 million at an eight percent discount rate.

Tournigan also said the indicated resource at the Slovakia uranium deposit has increased 94 percent to 28.5 million pounds since a 2009 preliminary economic assessment (PEA) and uranium grade was up 62 percent from the earlier PEA to 0.408% uranium concentrate.

Based on estimated indicated resources, mineral reserves were estimated at 2.5 million tonnes at an average grade of 0.346% uranium, which was determined to provide an underground mining rate of about 210,000 tonnes of ore per year for around 13 years.

Life-of-mine uranium concentrate production was estimated at 20.9 million pounds, or 9,500 tonnes.

Tournigan's president and chief executive officer, Dorian L. Nicol, said: "We are very pleased with these results. They demonstrate that the Kuriskova project has the potential to be among the lowest cost uranium producers in the world.

"The PFS not only illustrates the robust economics of the Kuriskova project but also the competitive advantages it has over other uranium projects as a result of its high-grade resource and relatively low operating cost estimates."

Initial capital costs for Tournigan's Kuriskova  project are seen at $225 million, which includes owner's costs and a contingency of $31 million. During the 13-year life of mine, there will be sustaining capital requirements of about $71 million, the company said.

Tournigan also indicated a 92 percent uranium recovery rate and 26 percent-lower life of mine operating costs.

The PFS estimates $22.98 per pound uranium life-of-mine operating costs and $16.68 per pound costs during the first four years of production.

Looking ahead, Nicol continued: "Our next step is, working with our strategic partner AREVA, to begin a feasibility study and environmental assessment study that will continue to define project parameters to a higher degree of confidence and allow the permitting of the project to begin.

"The development of the Kuriskova uranium project could provide Slovakia with a secure source of uranium for approximately 30 years at its current consumption rate."

AREVA SA (EPA:AREVA) is a French nuclear energy powerhouse that is partnering with Tournigan. In December, Tournigan announced a number of transactions in an effort to expand its uranium presence in Europe, including the formation of an alliance with AREVA  and the purchase of seven uranium properties in Finland and Sweden from Mawson Resources (TSE:MAW).

Tournigan said that according to the PFS for Kuriskova, the project can be best developed as an underground mine/processing facility, with a very small surface footprint using the best available technologies in its mining and processing operations.

The uranium explorer also said that there were multiple exploration targets within the Kuriskova license area, with the potential to expand the resource base and extend project life.

The PFS was prepared by independent consultant Tetra Tech.

Tournigan said it was planning an exploration program to continue testing multiple uranium exploration targets within the Kuriskova license area.

Exploration success would likely add resources that could be accessed from the planned Kuriskova infrastructure, and Tournigan said it will conduct further step-out exploration drilling where the high-grade mineralization is open along strike and at depth.

Tournigan is a uranium exploration and development company. Its flagship asset is the Kuriskova uranium deposit in Slovakia, which is among the highest-grade uranium deposits in the world.

Slovakia currently has four nuclear reactors generating half of its electricity, with two more reactors planned or under construction.

One reverse circulation drill has started on gold exploration targets located on the Medrizien license, the company said, with one diamond drill expected to start drilling on the Adi Rassi target in the southern part of the Debarwa license within three weeks.

The drills are expected to complete roughly 12,000 metres of drilling over the next four to six weeks, Sunridge said.

The first planned drill targets are a series of four, sub-parallel gold mineralized shear zones, which can be followed over strike lengths of 1,000 metres to several kilometres in length, and 50 to 200 metres in width on the western part of the Medrizien exploration license.

The company said that many of these zones have been mined by Italian colonists by both open-pit and underground methods, including the Hara Hot zone which was the largest single open-pit seen on the Asmara project.

Sunridge mapped and sampled parts of the four zones ahead of the drilling program, with a total of 450 rock chip and grab samples taken. Of these, 72 returned gold assays greater than 1 gram per tonne (g/t), including 16 samples with over 5 g/t.

The best gold values were seen at 68 g/t gold in a grab sample, and 15.9 g/t gold over 2 metres in a rock chip sample.

Meanwhile, at the Debarwa license on the eastern side, a newly discovered gold mineralized shear zone, known as Adi Kubulo, will be drilled. The zone can be traced for several kilometres, with an average width of about 80 metres.

At the area, 102 rock chip and grab samples were taken so far, with assays pending, Sunridge said.

On the southern part of the Debarwa license, the Adi Rassi prospect will be the first target drilled by the diamond rig, with the target located just 10 kilometres southeast of the Debarwa deposit.

Adi Rassi is associated with a north trending shear zone about 600 metres long and averages 70 metres wide, mineralized with copper and gold.

"Management believes that Adi Rassi could be a potentially large new copper and gold discovery based on earlier drilling results such as AR-002D: 84 metres with an average grade of 1.32 g/t gold and 0.84% copper; AR-003D: 25 metres with an average grade of 0.75 g/t gold; and 0.54% copper and AR-004D: 78 metres with an average grade of 0.22 g/t gold and 1.0% copper," Sunridge said in a statment Thursday.

Results from the 12,000 metre drill program are expected within two months.

Sunridge is a mineral exploration and development company that aside from Asmara, also has exploration properties in Madagascar.

In January, the company said it expects a feasibility study for the Debarwa copper-zinc-gold-silver deposit at Asmara in the first quarter of this year, which will examine the potential for a stand-alone open-pit mine and process plant at the deposit over a seven year mine life.

The other deposits at Asmara, collectively referred to as the Asmara North project area, include the copper-zinc-gold-silver Emba Derho deposit, the zinc-gold-copper Adi Nefas deposit, and the Gupo gold deposit.

Updated resources estimates for each of these deposits are expected within the first two months of this year. A pre-feasibility study for Emba Derho is expected for the second quarter of 2012, with a full feasibility study to follow.

Shares of the company were up 9.3 percent to 59 cents as of 11:37am ET.

Analysts expected to see a gain of 140-150,000 and no change in the jobless rate.

The figures followed Wednesday’s report from payrolls processor ADP, which said the private sector in the US added 170,000 jobs in January.

The impact from the strong jobs data was partly offset by weak euro zone sales figures for last year’s festive shopping season released by Eurostat today. Sales in the 17 countries that make up the monetary union dipped 0.4 percent in December, however, retailers including Next (LON:NXT, up 2.7pct at 2,768p) held up well.

Car insurer Admiral Group (LON:ADM, up 6.9pct at 1,028p) topped the FTSE 100 leaderboard after extending contracts with its reinsurers.

Other notable risers included hedge fund manager Man Group (LON:EMG, up 3.6pct at 131.4p) and insurance company Old Mutual (LON:OML, up 3.4pct at 156.7p).

Mining stocks were in decline today after an official report that came out in China, the world’s largest importer of base metals, showed a decline in the non-manufacturing PMI index from 56 in December to 52.9 last month.

Rio Tinto (LON:RIO, down 1.8pct at 3,908p) was the heaviest faller in the mining sector, followed by Vedanta Resources (LON:VED, down 1.7pct at 1,301p) and BHP Billiton (LON:BLT, down 1.4pct at 2,164p).

Investors also sold mining companies to take profits following yesterday's strong rally that followed Xstrata's (LON:XTA, up 3.5pct at 1,273p) comfirnation of merger talks with Glencore (LON:GLEN, up 3pct at 475.45p).

Russian steelmaker Evraz (LON:EVR, down 2pct at 446.4p) also was in decline.

US markets

Financial bookmakers are expecting an early rally on Wall Street following today’s stellar jobs figures from the Department of Labor.

Futures for the Dow Jones Industrial Average (DJIA) climbed 109 points (0.85 percent) in pre-market and futures for the broader S&P 500 index jumped 12 points (0.9 percent).

Traders in the US will have more data to digest later this afternoon with the Institute for Supply Management set to release its non-manufacturing index for January, while the Commerce Department will release factory orders figures for December.

A survey by FactSet forecast an increase from 52.6 in December to 53.2 in January in the non-manufacturing index.

UK corporate news

Back in the UK, other announcements in the top flight included a quarterly report from BT (LON:BT.A, up 3.8pct at 213.7p). The telecom major saw its adjusted pre-tax profits jump 48 percent to 18 percent to £628 million during the last three months of 2011 despite a five percent drop in revenues to £6.77 billion.

BT also told investors it expected to achieve its 2013 EBITDA target of over £6 billion this year, while delivering a free cash flow of £2.4 billion.

Fellow blue chip, insurer Old Mutual said that it will return £1 billion to shareholders after selling its long-term savings and banking operations in Sweden, Denmark and Norway for £2.1 billion.

The remaining proceeds of £1.1 billion will be used to reduce deBT, said Old Mutual.

Elsewhere in the FTSE 100, Tullow Oil (LON:TLW, up 1.5pct at 1,462p) has secured signed two new production sharing agreements covering the EA-1 and Kanywataba licences in the Lake Albert Rift basin and said it will now finalise farm-down deals with CNOOC and Total.

In addition, the Ugandan government has granted Tullow a production license for the Kingfisher project.

In the FTSE 250, software group Misys (LON:MSY, up 1.7pct at 331.2p) confirmed it is currently in discussions with Temenos Group AG over an all-share merger.

“Discussions are continuing and there can be no certainty that a transaction will ultimately take place, nor as to the terms on which any transaction might be constituted,” Misys said in today’s statement.

Sunridge Gold is a junior explorer focused on Asmara, as well as exploration properties in Madagascar.

In a research note, Ocean Equities said that Thursday's "impressive" drill results support the company's goal to upgrade the current 189,000 ounce inferred gold resource to higher resource categories, supporting the prefeasability study on the Asmara North assets, but also increasing the overall size of the resource.

The capital markets firm said the results suggest the size the of the deposit at Gupo, part of the Asmara North deposits in Eritrea, "has the potential to grow to 300,000 ounces of gold".

Earlier Thursday, Sunridge unveiled assay results from the final 63 drill holes of the recently-completed 8,100 metre, 99-hole drilling program at the Gupo gold deposit.

Among the highlights, drill hole GG-116-R returned 3.05 grams per tonne (g/t) gold over 28 metres; drill hole GG-125-R encountered 3.08 g/t gold over 13 metres; drill hole GG-128-R returned 2.77 g/t gold over 19 metres and drill hole GG-142-R returned 5.72 g/t gold over 12 metres and 6.52 g/t gold over 7 metres.

At drill hole GG-156-R, the company encountered 2.31 g/t gold over 22 metres, hole GG-160-R returned 5.30 g/t gold over 19 metres and drill hole GG-168-R encountered 10.09 g/t gold over 13 metres.

Sunridge's president and CEO, Michael Hopley, said: "We are very pleased with the results of this latest drilling campaign at Gupo and are confident that it will achieve the goals of both upgrading and increasing the overall size of the Gupo Gold deposit.

"The next stage will be the completion of a new resource at Gupo by Snowden and this will be an important step towards completion of the Prefeasibility Study on the Asmara North in late March this year."

Sunridge said that in general, these results confirm the location and grade of gold mineralization defined by previous drill holes down to depths of approximately 80 metres (Gupo South) to 150 metres (Gupo Main).

In addition, new zones of mineralization have been found laterally - east and west - as well as at depth and in some cases, these zones are open.

Ocean Equities also said that Sunridge is set for a big first half of 2012: the company is expecting to release the results of a feasibility Study on the Debarwa VMS project, which includes a direct shipping ore copper zone providing early cash flow.

Released to the market will be an appropriate valuation of the Debarwa project, including a production schedule with initial direct shipping ore copper production to ensure quick ramp up and access to early cashflow.

In addition, prefeasibility studies on the Northern Asmara assets - Emba Derho, Adi Nefas and Gupo - are scheduled to be released to the market early in the second quarter.

Ocean Equities also said resource upgrades are also scheduled to coincide with the upcoming feasibility studies.

Analysts expected to see a gain of 140-150,000 and no change in the jobless rate.

The figures followed Wednesday’s report from payrolls processor ADP, which said the private sector in the US added 170,000 jobs in January.

The impact from the strong jobs data was partly offset by weak euro zone sales figures for last year’s festive shopping season released by Eurostat today. Sales in the 17 countries that make up the monetary union dipped 0.4 percent in December, however, retailers including Next (LON:NXT, up 2.7pct at 2,768p) held up well.

Car insurer Admiral Group (LON:ADM, up 6.9pct at 1,028p) topped the FTSE 100 leaderboard after extending contracts with its reinsurers.

Other notable risers included hedge fund manager Man Group (LON:EMG, up 3.6pct at 131.4p) and insurance company Old Mutual (LON:OML, up 3.4pct at 156.7p).

Mining stocks were in decline today after an official report that came out in China, the world’s largest importer of base metals, showed a decline in the non-manufacturing PMI index from 56 in December to 52.9 last month.

Rio Tinto (LON:RIO, down 1.8pct at 3,908p) was the heaviest faller in the mining sector, followed by Vedanta Resources (LON:VED, down 1.7pct at 1,301p) and BHP Billiton (LON:BLT, down 1.4pct at 2,164p).

Investors also sold mining companies to take profits following yesterday's strong rally that followed Xstrata's (LON:XTA, up 3.5pct at 1,273p) comfirnation of merger talks with Glencore (LON:GLEN, up 3pct at 475.45p).

Russian steelmaker Evraz (LON:EVR, down 2pct at 446.4p) also was in decline.

US equities look set to for a strong open following the unexpectedly stronger NFP headline release, markets had been tentative prior to the data but roared into life after the stellar gains. Participants also focused on the drop in US unemployment to its lowest level since February 2009 in what is likely to capture the attention for most of today’s session as the figures are digested.

•          US Change in Nonfarm Payrolls (Jan) M/M 243K vs. Exp. 140K (Prev. 200K, Rev. 203K) - Sept to Dec Net job revision +52K

•          US Unemployment Rate (Jan) M/M 8.3% vs. Exp. 8.5% (Prev. 8.5%) - Lowest since Feb 2009

•          US Change in Private Payrolls (Jan) M/M 257K vs. Exp. 160K (Prev. 212K, Rev. 220K)

•          US Change in Manufacturing Payrolls (Jan) M/M 50K vs. Exp. 12K (Prev. 23K, Rev. 32K)

•          US Average Hourly Earnings (Jan) M/M 0.2% vs. Exp. 0.2% (Prev. 0.2%, Rev. 0.1%)

•          US Average Hourly Earnings (Jan) Y/Y 1.9% vs. Exp. 1.9% (Prev. 2.1%)

•          US Average Weekly Hours (Jan) M/M 34.5 vs. Exp. 34.4 (Prev. 34.4, Rev. 34.5)

•          US Change in Household Survey Employment (Jan) M/M 847 (Prev. 176)

•          US March 2011 total nonfarm payrolls benchmark revised by +165K

•          US NFP Birth/Death adjustment at -367K vs. Prev. -11K, largest adjustment since Jan 2010. (RTRS)

•          FTSE (+1.18%), CAC (+0.52%), DAX (+1.34%), SMI  (+1.09%), IBEX (+0.31%), EURO STOXX (+0.74%) prices taken at 1355GMT

DJIA

Earnings:

N/A

Other news:

ExxonMobil – Petroleos de Venezuela is negotiating with Co. to pay an arbitration award in crude oil instead of a cash settlement, according to a government source. (Sources)

Caterpillar – Co. CFO Ed Rapp says he believes the business cycle is in the early stages of recovery and sees a "tailwind" from demand in the US and Europe. (theflyonthewall.com)

Boeing – Co. is being awarded a USD 1.78bln firm-fixed-price contract for a modification is a Foreign Military Sales requirement for the Indian Air Force. Ten C-17 aircraft will be procured for the IAF. (RTRS)

Microsoft – Co. may reveal Halo 4 at a Spring Showcase in San Francisco on February 29. (Business Insider)

Bank of America – Co. won dismissal from Allstate’s lawsuit over the insurer’s alleged losses from USD 700mln in mortgage-backed securities purchased from Countrywide Financial Corp. (Businessweek)

Companies going ex-dividend: Intel (USD 0.2100)

S&P 500

Earnings:

Estee Lauder - Q2 adjusted EPS USD 1.01 vs. Exp. USD 1.01, Q2 revenue USD 2.74bln vs. Exp. USD 2.75bln. (RTRS/Sources)

-       Co. sees Q3 EPS USD 0.27-0.31 including charges

-       Co. boosts local currency sale forecasts to 9% and 10%

-       Co. sees year EPS USD 2.16-2.23 before restructure

Wynn Resorts - Q4 EPS USD 1.55 vs. Exp. USD 1.29, Q4 revenue USD 1.34bln vs. Exp. USD 1.36bln. (RTRS)

-       Q4 Macau operations revenue up 9.1% to USD 995.5mln

-       Q4 Las Vegas revenue up 7.2% to USD 348.4mln            

Tyson Foods - Q1 EPS USD 0.42 vs. USD 0.34, Q1 revenue USD 8.33bln vs. USD 8.32bln. (RTRS)

AON - Q4 adjusted EPS USD 0.97 vs. Exp. USD 0.96, Q4 Revenue USD 3.0bln vs. Exp. USD 2.99bln. (RTRS)

Clorox - Q2 EPS USD 0.79 vs. Exp. USD 0.69, Q2 revenue USD 1.22bln vs. Exp. USD 1.02bln, co. sees FY 2012 up 2-4%. (RTRS)

Other news:

Bristol-Myers – Co. received antitrust approval for their Inhibitex acquisitions after announcing the expiration of Hart-Scott-Rodino waiting period. Bristol-Myers offered USD 26 per share for Inhibitex. (Sources)

Ford – Co. is looking to increase exports of new vehicles to South Korea this year by 50% in the wake of a free trade deal. (Detroit News)

Viacom – Co. Chairman Sumner Redstone is expected to approve a subscription revenue agreement with Amazon and say the companies are putting "the final touches" on a deal. (NY Post)

Macy’s/JC Penney - Martha Stewart Living Omnimedia contends that a loophole in its contract with Macy's, which allows the home-goods company to sell any product from a Martha Stewart Living Store, will also let the company sell its products in JC Penney without a breach of contract. (RTRS)          

Mosaic – Co. cuts up to 20% planned Potash production from Feb-May due to cautious dealer sentiment that continues to delay purchases and lower near-term demand for Potash. (Sources)

Walgreens – Co.’s January front end comparable sales up 1.6%, January same store sales down 4.6% vs. Exp. down 2.6%. (RTRS)

NYSE Euronext – Co.’s deputy CEO does not rule out other big acquisitions, although currently has nothing in the pipeline following the collapse of the co.’s merger with Deutsche Boerse. (Sources)

National Oilwell Vargo – Co. completes a definite agreement to acquire NKT Flexible for around USD 670mln in cash. (Sources)

BB&T – Co. agreed to purchase wholesale insurance brokerage Crump group for USD 570mln in cash, co. sees recording USD 570mln in tangible goods and adding USD 300mln a year to its insurance business. (Sources)

Advanced Micro Devices – Co. announced a new, "ambidextrous" strategy that would allow it to offer chips that include circuitry it developed as well as those made by other companies. (WSJ)

Blackstone Group/Brocade – Blackstone is mulling an leveraged buyout offer of Brocade Communications, as small private equity funds including Thoma Bravo dropped out of the bidding for the company because a Brocade buyout would be too big. (Forbes)

Fluor – Co.’s board of directors has authorized a 28% increase in the quarterly dividend to USD 0.16 per share on the company's common stock. (Sources)

Marathon Petroleum – Co. launch a USD 850mln accelerated share buy-back program to be completed by Q3. (Sources)       

Companies going ex-dividend: Consol Energy (USD 0.1250), Firstenergy (USD 0.5500)

Companies paying dividend: CR Bard (USD 0.1900), Cabot Oil & Gas (USD 0.0200), Progressive (USD 0.4072)

Nasdaq 100

Earnings:

Gilead Sciences – Co. reported a Q4 non-GAAP EPS USD 0.97 vs. Exp. USD 1.05, Q4 revenue USD 2.20bln vs. Exp. USD 2.18bln. (RTRS)

-       Co. sees FY12 product sales USD 8.6-8.8bln

-       Q4 product sales USD 2.13bln, up 11% Y/Y

-       Q4 antiviral product sales USD 1.86bln, up 9% Y/Y

-       Co. anticipates the full-year 2012 diluted EPS impact of acquisitions, restructuring, and stock-based compensation-related expenses to be in the range of USD 0.31-0.34 per share inclusive of the Pharmasset acquisition

Other news:

Apple – Co. is very unlikely to release its iTV in Q2, as several upstream suppliers including Sharp appear unready to ship the company needed components. (Digitimes)

Research In Motion – Co. has announced it plans to give away PlayBook tablets to Android developers who quickly port their apps to run on the device. (All Things Digital)

Companies paying dividend: Yum! Brands (USD 0.2850)

Broker moves

Upgrades:

Urban Outfitters – Co. upgraded to Buy from Neutral at Janney Capital, Price target is USD 31

Peet's Coffee – Co. upgraded to Outperform from Neutral at RW Baird, Price target raised to USD 76 from USD 61

National Oilwell – Co. upgraded to Overweight from Equal Weight at Morgan Stanley, Price target raised to USD 100 from USD 79

BB&T – Co. upgraded to Equal Weight from Underweight at Barclays, Price target is USD 34

Gilead Sciences – Co. price target raised to USD 66 from USD 53 at Deutsche Bank, firm maintains a Buy rating on the stock

Downgrades:

Research In Motion – Co. downgraded to Underperform from Hold at Jefferies, firm lowered its price target for shares to USD 15 from USD 17

Merck – Co. downgraded to Neutral from Buy at Davenport, Price target is USD 40

Southern Union – Co. downgraded to Neutral from Buy at Citigroup, firm raised its price target for shares to USD 43.50 from USD 38

El Paso – Co. downgraded to Neutral from Buy at Citigroup, firm raised its price target for shares to USD 29 from USD 22

Edwards Lifesciences – Co. downgraded to Market Perform from Outperform at Wells Fargo, firm lowered its target range for shares to USD 81-83 from USD 91-93

Aetna – Co. downgraded to Buy from Conviction Buy at Goldman, Price target is USD 54

International Paper – Co. downgraded to Sector Perform from Outperform at RBC Capital, Price target lowered to USD 34 from USD 35

Brocade – Co. downgraded to Market Perform from Outperform at JMP Securities

CNBC’s Jim Cramer on US corporate earnings

FRIDAY earnings: Cramer is a buyer of both American Axel and Clorox on any weakness. 

Other news

Beam - Q4 adjusted EPS USD 0.69 vs. Exp. USD 0.67, Q4 revenue USD 637.5mln vs. Exp. USD 653.5mln. (RTRS)

Simon Property - Q4 adjusted EPS USD 1.91 vs. Exp. USD 1.91; boosts quarterly dividend. (RTRS)              

US Banks – Co.’s have been using reserves against bad loans to increase their earnings but they could soon begin to dry up affecting profits. (WSJ)

•      NIESR have predicted a modest contraction in the UK for this year, with a pick-up in growth rates for 2013.

•      International market focus shifts onto US Non-Farm Payroll data due at 1330GMT.

•      RANsquawk European Morning Briefing Video:  http://youtu.be/XfmwO7rbUDc

Market Re-Cap

European stocks are trading in positive territory ahead of the North American open amid positive sentiment after above expected PMI Services data from the UK and France. 

Chinese Premier Wen has moved to play down speculation that China will contribute to European stability measures, however he did add that the country is willing to cooperate with Europe to fight the current crisis, but this is not tantamount to “buying” Europe, stressing that China does not have the intention or the ability to do this.

Fed’s Fisher spoke overnight commenting that the FOMC’s rate and economic forecasts are “pure guesses” and are “tactical judgements” in a broader plan. 

US Headlines

Fed’s Fisher has warned market participants to view the Fed’s economic and rate forecasts with caution, referring to these forecasts as “pure guesses”. Fisher went on to say that these predictions are “tactical judgements” in a broader plan. He has also reiterated that monetary policy does face limits, and there is only so much it can do to aid employment levels in the domestic economy. Fisher concluded that he does not think the US requires additional monetary stimulus due to the slowly improving economy. (Sources)

The US Monster Worldwide employment index has slumped in January, as hiring was muted at the beginning of the year, falling 5% to 133 from 140 in December. (RTRS)

International market focus will shift towards the US Non-Farm payroll data for the rest of the session, expected to post a figure lower than the previous reading over the December Christmas period.

EU and UK Headlines

UK and French PMI Services figures have outperformed expectations this morning, however the equivalent German, Italian and Eurozone data have posted minor falls.

Chinese Premier Wen has said China does not have the intention or ability to “buy” Europe, but has said the country is willing to cooperate with Europe throughout the current crisis.

Pressure on Greece’s economy has increased after international debt inspectors admitted an additional EUR 15bln would be needed to fill a newly discovered black hole in the country’s finances. (Guardian)

NIESR has predicted the UK will suffer a modest contraction this year. (FT-More) 

The institute has downgraded its forecast for the year to a contraction of 0.1%. However NIESR has predicted a 2.3% growth rate for 2013. Director of the NIESR Portes, commented that the UK could boost the domestic economy with a cut to employer national insurance taxes or by spending on infrastructure without endangering the credibility of its targets. NIESR has also predicted UK inflation to fall back to 2.2% in 2012.

EQUITIES

European equities are trading in positive territory ahead of the Northern American open following above expected UK and French PMI Services data, however the German and Eurozone figures witnessed a minor unexpected falls.

The rainy-day funds that US banks have been tapping to boost their earnings could begin to dry up. Some analysts doubt banks can afford to keep up the pace of reserve releases, increasing pressure on profits that are being hit by slow economic growth, low interest rates and tighter rules. (WSJ)

Top performing sectors in the BE500: Financials (+1.11%), Technology (+0.73%), Telecommunications (+0.59%)

Worst performing sectors in the BE500: Oil & Gas (-0.38%), Basic Materials (-0.29%) Industrials (+0.06%)

**Note: For US equity news in detail, kindly refer to the RANsquawk Daily US Equity Opening News report.

FX

EUR/USD has pared earlier losses and is now trading in minor positive territory after preliminary reports from Chinese Premier Wen that China had no plans to “buy” Europe. These reports were later clarified with Wen reiterating that China will cooperate with Europe, but does not have the intention or the ability to “buy” Europe. EUR/USD is likely to exhibit further market fluctuations following the key US Non-Farm Payroll data.

USD/CAD has hit session highs, trading upwards following an increase in Canadian unemployment, currently trading at 1.0020. 

IMF’s Deputy Managing Director Shinohara has said intervention is an option if JPY moves excessively, however he has added that it would be difficult to do so and that the BoJ should be prepared to use monetary stimulus to defend the JPY. (Sources) Japanese Finance Minister Azumi has said Japan will act decisively against one-sided foreign exchange moves, adding that these speculative moves are increasing due to continuing low US interest rates. 

The Swiss Central Bank’s independence is under threat, according to the acting chairman. (FT-More) 

The independence of the bank is under political pressure concerning the potential cost of interventions, following the departure of Hildebrand as Chairman. Acting chairman Jordan reiterated that the central bank is committed stable policy operations and the ceiling it has set for the CHF, adding that “we are prepared to buy foreign currency in unlimited quantities if necessary”.  The central bank is estimated to have spent CHF 7bln when it stepped into the markets in September. 

COMMODITIES

After falling near a six-week low following disappointing US data yesterday, WTI Crude futures are trading in positive territory ahead of the North American open with further market activity possible after the crucial US Non-Farm payroll data, due to be released at 1330GMT. Iranian Supreme Leader Khamenei has said Iran will react to the current wave of Western oil sanctions, and any attempt to interfere with the country’s nuclear programme will harm the US.

Oil & Gas News:

• China's net crude imports are expected to rise 5.9% this year, the slowest growth rate since 2006, on slowing consumption. Net crude imports in the world's second largest oil consumer are estimated at 266mln tonnes in 2012 after 251.26mln tonnes last year, according to a report by state-run China National Petroleum Corporation.

•  SocGen have revised their 2012 Nat Gas forecast and now expect Nat Gas to average USD 2.40/MMBTU. This is down from a Nov'11 forecast of USD 2.90/MMBTU. 

•  Oil prices could fall to USD 70/BBL during 2012, as high volatility in the economy and energy markets become "a fact of life", according to Royal Dutch Shell executives. 

Geopolitical News: 

•  Iranian Supreme Leader Khamenei has said Iran will respond to oil and military threats, adding that Iran will not retreat from its nuclear stance under international pressures and any attacks on Iran’s nuclear programme will harm the US.

**Note: For commodities news in detail, kindly refer to the RANsquawk Daily Energy Commentary report.

After falling near a six-week low following disappointing US data yesterday, WTI Crude futures are trading in positive territory ahead of the North American open with further market activity possible after the crucial US Non-Farm payroll data, due to be released at 1330GMT. Iranian Supreme Leader Khamenei has said Iran will react to the current wave of Western oil sanctions, and any attempt to interfere with the country’s nuclear programme will harm the US.

Oil & Gas News:

• China's net crude imports are expected to rise 5.9% this year, the slowest growth rate since 2006, on slowing consumption. Net crude imports in the world's second largest oil consumer are estimated at 266mln tonnes in 2012 after 251.26mln tonnes last year, according to a report by state-run China National Petroleum Corporation.

•  SocGen have revised their 2012 Nat Gas forecast and now expect Nat Gas to average USD 2.40/MMBTU. This is down from a Nov'11 forecast of USD 2.90/MMBTU. 

•  Oil prices could fall to USD 70/BBL during 2012, as high volatility in the economy and energy markets become "a fact of life", according to Royal Dutch Shell executives. 

Geopolitical News: 

•  Iranian Supreme Leader Khamenei has said Iran will respond to oil and military threats, adding that Iran will not retreat from its nuclear stance under international pressures and any attacks on Iran’s nuclear programme will harm the US.

Corporate News: 

•  Russian gas export monopoly Gazprom has reduced gas shipments to Europe through Ukraine, according to Ukrainian Energy Minister Yuri Boiko.

•  Tullow Oil has signed two new production licences with Uganda and will now proceed with a farmdown deal with Total and CNOOC, which will pave the way for commercial oil production.

•  Venezuela state oil company PDVSA is negotiating with ExxonMobil to pay what it owes of a USD 907mln arbitration ruling that favoured the US company with crude instead of cash, according to a source in the PDVSA presidency. 

Weather news:

Weather Derivatives forecast sees average temp. in the US for the next 6-10 days to be 1.5% above the average at this time of the year. The data is accurate as of 2nd February, 2012. There are no tropical cyclones at this time.

All 12 regions in Japan are expected to experience below-average temperatures in the month from January 28 to February 27, the weekly weather forecast released Friday by the Japan Meteorological Agency showed.

Morning View:

The Fairfax mining team are making their way to Cape Town for the Indaba conference – The unlucky few left in London are looking forward to updates on cocktail parties, blue skies, beach weather and of course, site visits.      

· Please the company comments below for the most recent updates. 

Economic News:

China – Speculation is increasing that the Central Bank may take more measures to boost economic growth. 

· Stocks were up this morning on the back of the speculation. 

· The country’s money market rate dropped on speculation cash will return to the banking system as the holiday season comes to an end. 

· Reports have emerged that Premier Wen Jiabao has indicated in talks with Angela Merkel that China could contribute to the Euro area bailout program.

· China is reportedly considering funding options for the temporary European Financial Stability Facility and its permanent successor the European Stability Mechanism. 

· The funding would be channelled through the IMF. 

· Time will tell as to whether this talk will materialise into action. China will be reluctant to through money into a black hole and rightly so. 

· Figures released today show that Chinese industrial production companies’ profits increased at a slower pace in 2011 as the European debt crisis hampered exports from the country. 

· Net income for the year climbed 25.4% from 2010 for the sector according to the National Bureau of Statistics. 

US – Yesterday the Fed chairman Ben Bernanke warned over the state of the economy in a speech to Congress but gave no indication of further QE. 

· The Fed Chairman indicated that the pace of recovery remains “frustratingly “ slow and that the economy remains vulnerable to shocks. 

· Forecasts suggest that Employers increased payrolls in January, a sign companies are gaining confidence. 

· Estimates suggest employers added 140,000 in January on the back of an increase of 200,000 in December. 

· The jobless rate is expected to hold at 8.5% 

Japan – The IMF has stated that Japan must continue to keep working on improving its financial position, despite the problems in Europe, addressing the fiscal imbalances while supporting growth. 

· Forecasts suggest that the nation’s debt may exceed $13 trillion for the first time next fiscal year on the back of the rebuild from the earthquake. 

· The NEC, the maker telecom equipment is forecasting its 3rd annual loss in 4 years, stating that it would cut 7,000 jobs in Japan and 3,000 abroad. 

· This provides a timely reminder of the problems facing the country with regard to the level the yen has reached in the last few years. 

Europe – Finance Ministers of the AAA rated countries using the Euro will meet in Berlin today. 

· The market is awaiting news of the Greek re-structuring. 

· Reports indicate the plan will include a loss of more than 70% for bondholders in a voluntary exchange and new loans likely to exceed 130 billion euros.

· The Spanish Government have allowed the country’s banks an extra year to recognise losses if they agree to merge as it tries to overhaul the financial industry crippled as a result of the nation’s property boom and bust. 

· Additionally  The government will make banks increase the ratio of provisions set aside for urban and rural land to 80% from 31%

· We look forward to seeing if anything emerges with regard to Greece over the weekend. In our opinion Greece is a black hole. The austerity program is not working and the country is in no position to rebalance itself, facilitating growth. Officials should accept the inevitable and prepare for a Greek exit. 

· According to Bloomberg, France’s trade deficit swelled by the most of any euro nation in 2011, reaching a record. The French deficit is estimated to have been at €21.4bn in the first 10 months of last year.

India – The Reserve Bank of India has indicated that it will cut interest rates once it is satisfied that inflation will continue to slow. 

· Additionally a report this week showed that the nation’s budget deficit reached 92.3% of the fiscal year target in the nine months through December. 

· The country’s services industry has expanded in January at the fastest pace in 6 months. 

· The PMI increased to 58 from 54.2 in December. 

· The report adds to evidence that the country continues to weather the economic crisis. 

Russia – Forecasts suggest that officials will probably refrain from cutting interest rates this month after a surprise reduction in December and the implications of declining consumer confidence. 

· Bloomberg estimates that officials will maintain the refinancing rate at 8%. 

· The Central Bank wants to maintain inflation between 5% and 6% in 2012, from a record low of 6.1% last year.  

South Africa - The ANC has refused to comment on reports that a study it commissioned concluded that nationalization of the country’s mines would be detrimental to the country’s economy. 

· Additionally reports indicate that the process of nationalization could be found to be unconstitutional.  

· The report will be presented to the National Executive Committee in the coming days. 

Indonesia – Bloomberg is forecasting that growth in the country probably exceeded 6% for a 5th quarter as domestic demand offset a slowdown in export demand from the west. 

The country is outperforming its neighbors as a result of rate cuts and the government’s commitment to maintaining growth of over 6%.

Commodity News:

Precious:

Gold US$1,758/oz vs US$1,749/oz yesterday – Gold held steady this morning ahead of the US monthly payroll data. 

· Holdings in gold backed ETPs increased by 0.4% to 2,384.8t yesterday.

· SPDR gold trust holdings increased to 1.277t (41.061moz) value US$71.871 from 1.271t (40.867moz).

Platinum US$1,630/oz vs US$1,624/oz yesterday

· 17,200 miners dismissed following a labour action at Rustenburg mine operated by Impala Platinum in South Africa.

· Operations stopped after 5,000 rock drill operators launched a strike as the company refused to pay them retention bonuses that were offered to general mining staff.

· On Monday, general miners joined the action supporting fellow workers.

· Anglo American Platinum will acquire 2 projects from Anooraq Resources for US$213m that will be used to reduce tis debt outstanding to Amplats.

Palladium US$712/oz vs US$698/oz yesterday

Silver US$34.22/oz vs US$33.77/oz yesterday

· Silver is the best performing precious metal is up 23% so far this year on short-covering and strong physical buying, Royal Bank of Scotland said.

Rhodium US$1,418/oz vs US$1,418/oz yesterday                                                        

Base metals:

Copper US$ 8,370/t vs US$8,428/t yesterday – Prices are little changed as market waits for payroll figures in the US in Jan. 

· Glencore’s Mopani Copper Mines in Zambia raised miners’ pay by 17%, nearly three times the inflation rate. Although a pay rise was below employees’ expectations, labour unions advised workers to accept it.

· Konkola Copper Mines owned by Vedanta Resources in Zambia increased wages by the same amount last month.

· Antofagasta plans to raise copper production to 700kt this year from 640.5kt in 2011. The company recorded a 22.9% rise in an annual copper output last year.

Aluminium US$ 2,209/t vs US$2,275/t yesterday

Nickel US$ 20,958/t vs US$21,210/t yesterday

· Spot nickel premiums in China stay at low levels following a Chinese New Year as market participants increased supply after prices rebounded.

Zinc US$ 2,101/t vs US$2,125/t yesterday

Lead US$ 2,170/t vs US$2,236/t yesterday

Tin US$ 24,050/t vs US$24,300/t yesterday

Energy:

Oil US$112.07/bbl vs US$111.56/bbl yesterday – Brent spot declines 0.5% this morning with Brent futures for March delivery was little changed down 27 cents to $112.20/bbl.

· U.S. crude declines to $96.36/bbl on the New York Mercantile exchange with WTI at $96.45/bbl on the London-based ICE futures exchange. 

· Abu Dhabi is pushing to complete the $3.29bn underwater oil pipeline from the UAE to an export terminal on Gulf of Oman to head off any disruption that could manifest in the controversial Strait of Hormuz chokepoint. 

· The Abu Dhabi pipeline has a capacity of 1.5m/bblsd. Completion of the pipeline is expected to be in May. 

· Royal Dutch Shell said it plans to pump $30bn into new oil and gas projects this year after announcing a profits rise of 50% to $28.6bn for 2011 

· Shell’s Chief Executive Peter Voser said that the company’s dividend would be hiked in 2012 but at a lower level than some analysts had been expecting. 

· Saudi Arabia looks set on raising the price of its lowest-quality crude as it reaps gains from the rising cost of shipping fuel 

Natural Gas US$2.554/mmbtu vs US$2.382/mmbtu yesterday – Slovakia, Austria, Italy and Poland are being hit by a shortfall in gas supplies from Russia as cold weather sweeps across the continent. The reduction is c.10%

· The countries have been able to make up shot-falls using alternative sources said a spokesperson from the European Commission 

Uranium US$52.95/lbs vs US$52.95/lbs yesterday – Extract Resources has been granted a trading halt by the ASX pending the downstream offer from Taurus Mineral Limited.

· Taurus is owned by CGNPC uranium resources co. and the China-Africa Development Fund and has been seeking to acquire Kalahari Minerals plc 

· Kalahari has a c.43% stake in Extract Resources and Extract’s main asset is the Husab Uranium project, the fourth-largest uranium mine in the world due to in production in 2014. 

· The offer for Kalahari Minerals Plc made by CGPNC has been declared wholly unconditional. 

· Kalahari have not yet accepted the Offer, but are urged to do so without delay, Kalahari Minerals shares were trading at 243p this morning. 

Coal – Heavy rains have shut four coal mines so far in eastern Australia’s state of Queensland as the military are called in to evacuate stranded residents.

· Whitehaven coal said that it shut four mines but the mines were not flooded and no equipment has been damaged. 

Other:

Steel – Posco, the world’s third biggest steelmaker, announced a 12% drop in annual profits to US$3.3bn last year on weak demand and falling steel prices.

· Posco along with Baoshan Iron & Steel and Nippon Steel expect a subdued demand in the near term.

· Prices for benchmark hot-rolled coils probably declined by around 5% in Q4 2011 compared to the previous quarter, Posco said.

Rare Earths – Malaysian authorities have pledged to appoint an independent monitor to review the projects safety for the newly announced Lynas Corp rare earths plant, following protests over its approval.

· Malaysia hopes that the $230m plant will boost growth, but concerns from groups over potential leaks of radioactive waste have not been satisfied. 

· The board of Lynas has been told to submit plans for a permanent disposal facility within 10 months. And make a $50 financial guarantee otherwise the licence could suspended or revoked. 

Company news:

Ovoca Gold (LON:OVG) – Company provides an update on Rassoshinskaya Field work results. 

· Company with assets in the Magadan Region of East Russia provides a positive update on work at the Rassoshinskaya project located in the Srednekansky and Omsukchansky districts.

· The Rassoshinskaya licence covers 2,460km2 

· A new, experienced geological team has been appointed to lead the program. Darren Allingham (ex - Barrick Gold) and Vladimir Shpanov (ex – Kinross)

· Over the course of the last year work has been focused at the Podgorniy and Zet prospects within the Rassoshinskaya project with trench results showing that there is significant high-grade gold and silver hydrothermal mineralisation throughout. 

· Highlights at Podgorniy include 10m @7.9 g/t gold and 10.9g/t silver  

· Highlights at Zet include 1m @ 14.2 g/t gold and 121.0g/t silver. 

· Historically it has been estimated that 12 tonnes of alluvial gold has been mined in the rivers which surround both prospects.  

· In 2011 at Podgorniy twenty surface trenches were excavated over 1073.1m, with a total of 391 fire assays completed with an average of 0.9m spacing. 

· These trenches returned some significant gold and silver assay with results including 15.45g/t gold and 36.59 g/t silver with an intersection of 2.6m. 

· More samples will be taken during the summer field season in 2012. 

· Over 2011 the company diamond drilled 46 holes totalling 4613.2m on 4 traverses aligned in the North east direction with a -55 degree dip. These drill holes were the first to have tested the prospect. 

· Total strike length tested was 1400m leading to a total of 1752m of core. See table below for results. 

· Management report that the mineralisation age is thought to be similar to the Olcha project to the south. 

· At Zet a total of 2500m over 20 holes was drilled. The strike length tested was 1700m with Wells drilled down to 120m. Samples totalled 247.214.3m (See second table below)

Conclusion - Ovoca Gold is one of the few junior gold explorers with assets in Russia. The management have a track record of achieving value for assets in Russia and we are encouraged by the new appointments. The news on the field work is encouraging and continues to show the progress the company is making. Work will continue in 2012 on Rassoshinskaya with the prospect of identifying further targets that could potentially develop into satellite projects. 

*Fairfax IS plc acts as UK broker to Ovoca Gold

SITE VISIT REPORT - Kenmare Resources (LON:KMR) - rising demand / prices and new expansion should drive Kenmare to new levels this year - 

· Kenmare Resources $300m expansion looks set to transform Kenmare's business.

· Titanium concentrate (ilmenite) prices have risen strongly in recent years and this has served to raise margins for new concentrate contracts.

· Kenmare still supplies ilmenite concentrate under legacy contracts put in place at the time of the financing at relatively low prices. But new contracts are at much better price levels and more than compensate for the low prices which held back profits last year.

· Contracts: The use of longer term supply contracts with confidential pricing has made Kenmare difficult to analyse in the past but supply side issues eg a growing market deficit has moved pricing onto a shorter term basis.  Ilmenite prices should average around $350/t although differing products can lead to some variation on this.  

· The great news is that far more sales are at higher price levels and with a tightening market we should see some stabilization or improvement in contract pricing.

· Expansion: the new dredge and processing plant being constructed draws from lessons learned in building and operating the current plant.  Extra powerful sand cutters and pumps are installed and the whole structure is upgraded to better withstand the cyclones which occasionally ravish the Mozambique coast.

· Competitive advantage: should be gained from this relatively uniform, long life project.  The ilmenite does not need 'roasting' / pelletising before sale.

· Inventory: is selling fast, the storage bins were nearly empty on our site visit and the transhipping process is being upgraded to handle the extra production capacity.

Conclusion: Kenmare have done well to build a new, possibly, world class, ilmenite mining operation in this remote area.  New contracts should raise margins and profits start to flow. Dividends look possible on final agreement with the company's lenders and agreement that the project is finally fully commissioned.

Cluff Gold (LON:CLF) – Acquisition of New Burkina Faso Gold Project.

· The company has announced that it has entered into an agreement to purchase Orezone Gold Corporation.

· The deal comprises11m new Cluff Gold ordinary shares and US$15 million cash. 

· The acquisition has been financed from Cluff Gold's existing cash resources which stood at US$28.9 million in December. 

· The acquisition will allow Cluff to acquire all of Orezone’s licences and the Sega gold project.

· The Sega project is within 20km of Cluff’s Kalsaka project and is well served by roads and sufficient water to sustain a mining operation. 

· The project currently has a NI 42-101 compliant indicated gold resource 450,366oz and 147,344 inferred – A 10,000m RC drilling program has recently commenced at Saga with the aim of defining additional oxide resources. 

· Previously completed Metallurgical test work has indicated average heap leach recoveries of 85% for oxide and transitional ore with favourable agglomeration properties

· Management plans to undertake a Preliminary Economic Assessment to confirm the feasibility of an operation whereby ore would be trucked from Sega to Kalsaka and processed at the company’s existing plant. 

· Initial estimates suggest that the capital costs associated with the commencement of production from Sega would be approx US$8m – these costs would include the additional crushing capacity required, new leach pads, site civil works, infrastructure and fleet upgrades. 

· Currently Kalsaka produces 71,505oz at an average head grade of 1.45 g/t in with guidance for production of 60 - 70,000oz in 2012.

· An expansion campaign is currently ongoing at Kalsaka with the aim of extending the oxide mine life. 

Mining this week: 

North River Resources (LON:NRRP) – Maiden resource at Malachite Pan & Upgrade to resource at Koperberg

Xstrata (LON:XTA) – Confirmation of approach from Glencore.

Aureus Mining (LON:AUE) – Maiden Reserve and Technical update 

Mwana Africa (LON:MWA) – 41% increase in Zani-Kodo gold JORC resource

Sable Mining Africa (LON:SBLM) – Acquisition of an exploration permit in the Mount Nimba, south east Guinea

Central Asia Metals (LON:CAML) – Operational update on the Kounrad copper project in Kazakhstan and an increase in the project’s ownership to 100%

Ariana Resources (LON:AAU) – New Vein Systems Found at Red Rabbit Project

ENRC (LON:ENRC) – Operations update for Q4 2011

Hummingbird Resources (LON:HUM) – Maiden Resource at Tuzon Deposit Raises Total Resource to 3.7 m oz

Ampella Mining* (ASX:AMP) – Quarterly report highlights scope for future resources

African Minerals (LON:AMI) -  New Convertible Loan and Refinancing Package

Coal of Africa (LON:CZA) – Quarter end Report for Dec 2011

Impala Platinum (LON:IMP) – New ceo Terence Goodlace appointed to take over from David Brown

Stellar Diamonds (LON:STEL) – Interim Results to 31 Dec 2011

Sumatra Copper & Gold (ASX:SUM) – Fast track to underground mining Quarterly Update

Ampella Mining* (ASX:AMP) – Metallurgical work at Konkera show 88%-98% recovery

Bellzone Mining (LON:BZM) – Forecariah JV Progress Update

Diamond Corp (LON:DCP) – Operational Update

Discovery Metals (LON:DME) – Delisting from AIM, Retaining ASX and Botswana Stock Exchange Listings

Goldplat (LON:GDP) 14 pence, Mkt Cap £23.4m – Operations Update on Recovery Operations

Vital Metals (ASX:VML) 6.5Asc, mkt cap A$13m – Drill results from Kollo and Boungou look encouraging

Medusa Mining (LON:MML) – Quarterly Activities Report

The takeover of uranium miner Kalahari Minerals (LON:KAH) by Chinese state-owned Guangdong Nuclear (CGNPC-URC) has now been declared unconditional.

In a statement this morning, CGNPC-URC said all of the conditions of its 243.55 pence per share offer for Kalahari have now been satisfied or waived and urged Kalahari shareholders who have not yet accepted the offer to do so “without delay”.

Acceptances have so far been received for shares representing 89.5 percent of Kalahari’s share capital.

The offer, valuing the group at £630 million, was announced and recommended by Kalahari back in December and received the approval of Namibian regulators in January.

Kalahari’s main asset is a 42.5 per cent stake in Extract Resources (ASX:EXT, TSE:EXT), which is developing the Husab Uranium project in Namibia.

Extract received a mining licence at the start of December that will enable the project to move into its production phase, establishing Husab as one of the three largest Uranium mines in the world.

CGNPC-URC has made its offer in conjunction with CADFund, an equity investment fund, indirectly 100 per cent owned by China Development Bank Corporation.

Game said the revised terms mean it will operate at a lower borrowing level than previously but the new terms will allow it to continue to trade.

The group added it now expects a loss before tax and non-recurring items of £18m for the year to 31 January 2012 but it would not now breach its loan covenants.

Game warned three weeks ago it was in danger of breaching its EBITDA test after a slump in trading over Christmas.

But after receiving support from its stakeholders and lenders, the retailer said it will meet its covenant tests for the period to 31 January 2012 when they are tested on 27 February.

The new loan terms included an updated strategic plan which will be reviewed and approved by the lenders.

“This plan will cover all aspects of the business's activities and strategy, including its overseas operations, Game said.

Ian Shepherd, Game’s chief executive, added: "We're pleased to reach agreement with our lenders, but should be under no illusions about the challenges in our market or the hard work that is required to deliver our strategic plan."

Game has been battered by a widespread slump in the computer games market, which has suffered due to general economic conditions and a shift by people to downloading games or playing online.

The group has already started on a store closure programme and is expanding its digital sales operation.

Shares rose 1.6p to 7p.

It has a gross 13 million acres under licence, exposure to some of the most exciting exploration projects in the country and the potential for cashflow in the near term.

As an oil and gas jurisdiction, Morocco is as good as they come. The government take is minimal when compared with hydrocarbon-rich neighbours, Algeria or Libya.

And there is a ready source of domestic demand from a country which last year imported $10.7 billion-worth of foreign oil and gas.

The fiscal terms are amongst the most attractive worldwide with the state receives 25 per cent of any project and a 5 per cent royalty if gas is produced, which rises to 10 per cent for oil.  An unprecedented ten-year corporate tax holiday is offered upon discovery.

This means the government take is never more than 35 per cent. Contrast this with Algeria, where the authorities take 92 per cent and you can see why foreign investment is flooding into Morocco.

Total, Repsol and Anadarko are just three of the larger operators in country.

And under this regime, the economics of the smaller projects look very attractive.

Longreach has stakes in five licences in Morocco, operating its flagship project – Sidi Moktar, which is prospective for gas and promises the company’s first production and cashflow.

It has a 50 per cent working interest in the acreage in return for carrying out new seismic and the drilling of two wells.

Sidi Moktar is interesting in that it is bisected by the already producing Meskala field, which pipes gas to phosphate mines to the north.  

With  a pipeline infrastructure running through the Sidi Moktar licence, any discovery made by Longreach will be straightforward to tie in to begin cashflow production.

Two wells are planned for Sidi Moktar, with work scheduled to begin in the fourth quarter. 

The first portion of 2012 will be spent interpreting existing seismic, before shooting more to high grade prospects to identify a drill location, Benitz said.

The wells will target the Triassic sandstones, from which the neighbouring Meskala field is currently producing, though historic production on the Sidi Moktar licence has come from the shallower Jurassic zones. 

AJM Petroleum has a “best estimate” of 292 billion cubic feet of natural gas and a high estimate of 776bcf based on  five identified fields within the licence.

“The figures are only for Triassic targets,” Benitz said. “Lasmo used to operate in the area in the late 1990s and did a regional unrisked resource estimate for Sidi Moktar of 9 trillion cubic feet. So there is huge upside.”

The cost of drilling each well at Sidi Moktar is expected to be in the order of “$7-8 million” each, the Longreach chief operating officer revealed.

And while it is well funded with around $8.5 million in the treasury, the company will have to raise more cash if it is to develop at the rate it intends, Benitz confirmed.

With gas prices in Morocco at around $8 per Mcf, the payback is likely to be in the order of a year and a half based on historic flow rates. Similar wells drilled in vicinity during the 1980s are still going to this day.

Benitz said: “Payback is in the order of 18 months, giving around 20 years of profit potential.” 

The company also has a 22.5 per cent interest in the onshore Tarfaya exploration block, which is prospective for gas. London-listed San Leon Energy is the operator.

The offshore extension is owned by Tangiers Petroleum, and underpins the Australian firm’s $52 million market capitalisation.

Longreach, by contrast, is valued at around $14 million (giving an enterprise value of $5 million) despite having similar potential.

A total 1,450 kilometres of 2D seismic from Tarfaya has been reprocessed, which has identified 15 leads that independent reserve auditors, Netherland, Sewell and Associates, said have unrisked prospective resources of 711 million barrels of oil.

An additional 600 kilometres of infill 2D seismic was shot last year with processing expected to identify some drillable targets.

Longreach also holds a 22.5 per cent in the Zag exploration licence, which is also operated by San Leon Energy.

Covering over five million acres, the block butts up against Sonatrach’s 812Bcf discovery in the Tindouf basin and is a near neighbour of Repsol’s major gas discovery in the Reggane basin.

A 1,700km 2D seismic survey began in the final quarter of last year and was completed in January.  

Processing of the seismic is underway and once completed, a comprehensive review of the Paleozoic basin will be undertaken to assess the potential of a variety of plays.

The company’s smallest holding is in the offshore Sidi Moussa and Foum Draa prospects, where it has a 7.5 per cent interest.

The two areas have an extensive data set of 3D seismic shot by Enterprise Oil in 2001/2 with management indicating a “best estimate” of oil in place of 2.9 billion barrels.

Benitz describes the licence as having “huge potential”.

“Morocco offshore is now in hot demand with Kosmos and, more recently, Total taking up large acreage positions,” he said.  

“Our licences are without question the best explored with extensive 3D coverage, which has allowed us to identify a set of large prospects, which are now drill ready."

East Africa-focused Nyota is to raise £9.7 million through a share placing at 6p with Centamin to take 67 million of the 161 million new shares.

Added to its existing holding it will own just over 14 per cent of Nyota.

The money raised will fund the Tulu Kapi gold project in Ethiopia between completion of the definitive feasibility study and before project finance is set up.

Nyota added it would also be able to continue exploration on its Northern Block properties with the extra cash.

House broker Ocean said that unlocking the value of the northern blocks is essential.

“All the early indications have highlighted the potential for Nyota to quickly add ounces to its inventory from drilling some of its high priority targets,” said the broker.

“The company is undervalued on a per ounce basis on Tulu Kapi alone with an EV/oz multiple of less than $30/oz.”

“Delivering a resource for at least one of the targets on the northern block will demonstrate both the ability of the team to meet targets but also the mineral potential of Nyota’s land holding.”

Centamin acquiring a large stake also has many benefits, the broker said, and supports the idea that Nyota has some of the best ground in the Arabian-Nubian shield still held by a junior mining company.

Centamin has excellent working knowledge of the geology in the region and of working in East Africa through operating its Sikuri mine in Egypt and its general strategy in East Africa is also substantially to grow its portfolio through acquisitions.

Richard Chase, Nyota’s chief executive, said he was delighted with the response from large shareholders to the cash call and also with Centamin’s involvement.

“The backing of an industry peer is encouraging, both for the prospects for Tulu Kapi and wider exploration within our Ethiopian assets and we greatly look forward to Centamin's ongoing support of our efforts in Ethiopia.” 

He also said he expects there to be a number of cash calls from other exploration companies in the next four months and Nyota had to ensure it had enough money to carry out its objectives beyond this year.

The shares to be issued represent 25.19 per cent of the existing share capital.

After the placing the group will have approximately £17 million of cash on its balance sheet.

The Tulu Kapi project currently has a resource of 1.46Moz of gold at an average grade of 2.84g/t gold.

It is expecting to receive its mining licence from the Ethiopian mining authorities by the middle of 2012, to be followed by a definitive feasibility study for Tulu Kapi in the third quarter.

Ocean also added that contained ounces expected to grow and the next resource estimate is expected to include a measured resource component.

Shares in Nyota rose by 11% to 8.05p.

Today’s drilling report included the results received by the company since the last drilling update on December 20, including the last drill hole on the La India vein set and nine drill holes on the America vein set totalling 2,331 metres.

Condor reported a wide high grade gold intercept on the India-California structure including 4.19 metres grading 6.94 grammes per tonne (g/t) from the California vein and an interval of 7.37 metres at 6.31 g/t gold from the India vein.

The company said the two veins are just 25 metres apart at this intercept, which “adds credibility” to the potential for open pit mining.

The most significant results came from the Natalia vein, which was intercepted in six out of nine drill holes and is open in both directions along strike. The grades reported form this vein included 4.22 g/t gold over eight metres.

Condor is currently working on determining the 2012 drill programme, which it hopes will help it hit its target of increasing the La India resource to two million ounces of gold.

The company also plans to convert inferred resources into the indicated category, define potential open pit targets and proceed with feasibility studies for a commercial mine.

Condor decided to pause drilling during January to reassess its exploration strategy following the larger than expected mineral resource of 1.62 million ounces at La India announced on December 30.

Last week, the company received data for 3D models used to interpret the resource and plan future drill programmes.

New targets generated by the 2011 drilling campaign and recommendations from a mine concept study by consultants SRK Consulting will be used to determine drill programmes for 2012.

Investors welcomed the report as shares in Condor rose four per cent to trade at 6.75 pence in early deals, valuing the company at £37.7million.

Please find below a recent summary of our outlook for the oilfield services industry as well as our investment stance. We are highly selective on our investment stance and note that fundamentals are very attractive although the sector is highly oil price sensitive but offers limited direct exposure to the prevailing European economic woes. The full report is attached and includes most relevant charts pertaining to the industry and sector.

Solid fundamentals prevail for 2012 supported by recent positive trading comments

The fundamental outlook for global oilfield services companies remains favourable, reflecting continuing rising global hydrocarbon energy demand despite macro-economic concerns, increasing oil/gas industry capital expenditure - 10-15% pa over the next 4 years- and expectations of relatively high oil prices- annual average greater than $85/bbl, albeit with volatility. (U.S. Natural gas prices have recently fallen sharply to around $2.6/BTU but following recent production cuts we are confident that pricing levels will recover in the near term.) The overall rig count is likely to be on a continued rising trend with strongest rises in the Gulf of Mexico and West Africa. These positive factors are supported by encouraging company trading updates, healthy order books, good cash flow generation and solid financial positions. Valuations are generally not over demanding. Our key Buy recommendations in the UK are Kentz (LON:KENZ), Hunting (LON:HTG), Petrofac (LON:PFC), and Wood Group (LON:WG).

Investment Recommendations- Stance highly selectivity; limited exposure to European economic woes but oil price sensitive

Kentz (LON:KENZ)is competitively well placed servicing a wide range of upstream and downstream markets and many geographies. The order book remains extremely promising, giving good earnings visibility. The positive trading statement supports sound fundamental prospects with an attractive risk/reward profile. Share price outperformance is likely to continue despite the strong performance in 2011. The securing of prospective business will be the key catalyst

Petrofac’s (LON:PFC) goal to double recurring 2010 earnings by 2015 is attainable and the backlog at around $10.6Bn is comparatively very healthy giving the group good earnings visibility from its backlog. The shares should see a more sustained outperformance in 2012.

Hunting (LON:HTG)has a strong competitive position owing to its product focus and global footprint. The group is a cyclical play on oil and particularly gas activity especially in the U.S.- the current weakness reflecting the low US gas prices. This provides an excellent entry level.  We believe that the shares are likely to outperform other UK oilfield stocks given the relatively favourable risk/reward profile.

Wood Group (LON:WG): The Group has an attractive and well positioned competitive standing, with strong market position. The risk/reward profile is now more favourable and this supports our still positive stance towards the stock.

Schoeller Bleckmann (FRA:SLL): The group is very well positioned in the directional drilling market, with a leading competitive market position with niche products based upon proprietary technology. The recent share price weakness correlates with the fall in US natural gas prices. We expect a rebound in the latter and consequently believe current share price levels as an excellent entry point.  Traditional metrics suggest a full valuation but our DCF valuation implies upside potential of around 10%.

Newpark Resources (NYSE:NR): Newpark is a well-positioned, mid-sized U.S. oilfield services company with most attractive growth opportunities in the U.S. gas shale basins and in international markets including the fast growing Far East and Brazilian market. This growth profile is not reflected in the undemanding and favourable valuation compared with its peers. 

Recent Newsflow – Recent outlook statements bode well despite European macro-economic concerns

Rig Count News. The Baker Hughes Rig Count is the key barometer for the oilfield services industry and in particular the drilling contractors. Last week’s data (week ending (27/01/12) remained positive for the industry as a whole. The U.S. Rig Count stood at 2008, unchanged on the previous week and up 276 year over year with the number of land rigs at 1949. The number of oil rigs stood at 1,225. Gas rigs stood at 777 down 3 as US gas prices remain low with the directional/horizontal rig count at 1,402. The Canadian rig count gained further momentum, up 29 on the previous week.

Kentz’s (LON:KENZ) end of year trading statement read most positively. In terms of outlook the company stated ’Overall, the outlook is very positive, underpinned by the solid project pipeline of our core clients, which gives us confidence for 2012 and beyond.” Revenues and profits for the full year 2011 were marginally ahead of consensus expectations. The group has a record backlog of US$2.40Bn at 31/12/ 11, up 50% from 31/12/10, underpinned by further new awards and natural growth on existing contracts. This backlog included 60% of reimbursable service contracts with significant opportunity for continued natural growth during 2012. In addition the pipeline of prospects is just over US$10Bn. The cash position remains strong at around US$223m, which supports continued growth, both organically and through acquisition.

Hunting’s (LON:HTG) year end trading statement was very positive. ‘Trading since the release of the IMS on 17 November 2011 has exceeded management's expectations particularly within our North American manufacturing and connections business units where demand continues to show strong momentum, together with excellent trading from our Asia Pacific operations. As a consequence 2011 full year earnings, which are still subject to external audit, are now expected to be above the top end of analyst expectations. Management are comfortable with the business outlook for 2012.’ This is despite the recent weakness in US gas prices.

Schoeller Bleckmann’s (FRA:SLL) preliminary 2011 results were very pleasing and above consensus. Group sales went up by 32% to EUR407M. Earnings before interest and taxes (EBIT) increased by 80% to EUR89M with an operating margin of 21.8%, up from 21.2% at the 9 -month stage. Earnings before taxes (EBT) rose 80% to EUR 77M. We believe these results underpin the likelihood of further good results in 2012. 

Petrofac (LON:PFC): Petrofac and Schlumberger announced recently that their Integrated Energy Services and Schlumberger Production Management divisions respectively have signed a Co-operation Agreement under which these divisions will establish a working relationship to deliver integrated and high-value production projects in the emerging and growing production services and production enhancement market Both companies will deploy their own capital in these production enhancement projects. The market opportunity for the collaboration is significant as major resource holders seek to develop discovered low-risk reserves against an industry environment characterised by a shortage of capability and capacity.

Schlumberger’s (NYSE:SLB) Q4 2001 results were broadly in line with market expectations. Income from continuing operations was $1.49 Bn—an increase of 13% sequentially and 28% year-on-year. Diluted EPS from continuing operations was $1.11 versus $0.98 in the previous quarter, and $0.85 in the fourth quarter of 2010. 2012 outlook comments were broadly encouraging. ‘‘Uncertainty remains over the outlook for 2012 due to the continuing sovereign debt crisis in Europe which places downward pressure on GDP and oil demand forecasts. Natural gas markets are well supplied in North America with gas storage well above five-year highs.  In this environment, the thin excess oil supply cushion is expected to support oil prices close to current levels, while global demand for LNG continues to increase. Recent E&P customer spending forecasts also point to higher E&P investment in 2012, particularly in international markets. Against this backdrop we are planning for growth in 2012, while building the required flexibility into our resource plans. We remain confident that any potential reductions in activity will be short-lived and that our competitive position remains strong, given our presence and strength in the international markets and the balance we have established between reservoir characterization, drilling and production services in our North America offering.”

Weir Group (LON:WEIR), the engineering solutions group, has agreed to acquire Novatech, a US manufacturer of well service pump valves and valve seats for upstream oil and gas applications, for $176m (£113m) in cash.  Subject to US regulatory approvals, completion of the acquisition is expected in February 2012. Novatech, a family-owned business, produces a wide variety of proprietary valves and valve seats for high pressure applications such as frac, cement and mud pumps used in unconventional upstream oil and gas operations.  Novatech achieved proforma revenues and EBITDA of US$61.6m and US$25.2m respectively for the most recent fiscal year ending 30/09/2011. The most relevant transaction multiples for the deal are of an EV/sales of around 3 times and an  EV/EBITDA of six times.

Wentworth Resources (LON:WRL) today announced the spudding of the onshore Ziwani-1 exploration well on the Mnazi Bay licence onshore Tanzania, in the Rovuma basin.

The well is being drilled near the coast within the Rovuma basin. Mnazi bay is already known to host hydrocarbons, and two gas fields have already been established in the area. The last well in Mnazi Bay was drilled in 2007.

In recent years a number of majors have made very large gas discoveries in the Rovuma basin, offshore in deep waters.

Ziwani-1, the fifth well to be drilled in Mnazi Bay, is located 13 kilometres from the Mnazi Bay and Msimbati gas fields. It will be drilled to a depth of 1,800-2,500 meters. And it is targeting Miocene and Oligocene sandstones, which are similar to the reservoirs of the nearby gas fields.

"We are excited to start the year with a high impact work programme that has the potential to deliver significant asset growth and shareholder value in 2012,” managing director Geoff Bury said.

The spudding follows last week’s news of Wentworth’s asset swap deal with Cove Energy, which gave the firm and increased stake in Mnazi Bay.

The deal, valued at US$38.8 million, saw Wentworth trade in a royalty it held over Cove’s future production (from the offshore Rovuma concession) in return for Cove’s 16.38 per cent stake in the Mnazi bay. It will also issue shares and make a future cash payment to Cove.

Wentworth and the operator Maurel et Prom will now take the Mnazi bay assets forward, alongside the Tanzania Petroleum Development Corporation. 

Maurel et Prom own 38.22 per cent stake in Mnazi Bay and the TPDC owns a 20 per cent stake.

Under the Mnazi Bay joint venture agreement Wentworth’s exploration costs are partially carried.

It will pay 30 per cent of the costs of the Ziwani-1 well and holds a 52.225 per cent participating interest in this exploration well.

"The carried interest we enjoy in the Mnazi Bay concession provides full participation with reduced financial exposure,” Bury said.

“We look forward to updating further on the Ziwani-1 well as well as our entire work programme as we commence what is a seminal year in the company's development."

The Ziwani-1 drilling is the start of the 2012 Mnazi Bay work programme.

In addition to Ziwani-1 the programme will include work-overs on three existing wells and the drilling of one further well – which will be either appraisal or exploration.

“This well and the 2012 work programme are designed to explore for additional hydrocarbon resources and to further prove up existing natural gas reserves,” Wentworth said.

“Proving up additional gas resources will enable the concession partners to commit to and deliver agreed quantities of natural gas to the proposed Dar es Salaam to Mnazi Bay pipeline.”

Wentworth also told investors that talks are underway with TPDC with a view to agreeing a long-term gas supply agreement.

Centamin is to take 67 million of the 161 million new shares to be issued and when added to its existing holding it will own 14.08 per cent of Nyota.

East Africa-focused Nyota said the £9.66 million raised would enable it to develop the Tulu Kapi gold project in Ethiopia between completion of the definitive feasibility study and before project finance.

Nyota added it would also be able to continue exploration on its Northern Block properties with the extra cash.

Richard Chase, Nyota’s chief executive, said he was delighted with the response from large shareholders to the cash call and also with Centamin’s involvement.

“The backing of an industry peer is encouraging, both for the prospects for Tulu Kapi and wider exploration within our Ethiopian assets and we greatly look forward to Centamin's ongoing support of our efforts in Ethiopia.” 

He also said he expects there to a number of cash calls from other exploration companies in the next four months and Nyota had to ensure it had enough money to carry out its objectives beyond this year.

The shares to be issued represent 25.19 per cent of the existing share capital. 

About 147 million will be issued to UK investors at 6p each, with the remaining 14 million sold Australian investors at A$0.089.

This is an interesting article from Mineweb. Here is a sample:

But because Chinese total figures on imports and demand are actually obscured nobody really knows the true situation, except perhaps the Chinese government. Export of gold is not allowed so total Chinese production (as noted above at around 361 tonnes) is going somewhere. The question is, is it going into Chinese industrial, investment and jewellery demand, or is all this being catered for by the imports?

There is thus a strong suggestion that Chinese gold production is, in fact, all going into the country's gold reserves which are only reported sporadically, and the last official pronouncement on this was that reserves totalled 1054 tonnes - back in 2008 - and this was nearly double the amount previously reported five years earlier at 600 tonnes. If China is indeed putting all its domestic production into its reserves then these could now well be at 2,000 tonnes or more - but even this is still a small fraction of China's total monetary reserves and there certainly has been internal discussion in China that the proportion of gold in its reserves should be much higher.

The argument stands that China is increasing its gold reserves surreptitiously because if it were confirmed officially that it was adding say 300 tonnes or more to its reserves annually (i.e. the amount of domestic gold production) this would have a strong upward impact on the gold price and make it more expensive to add further amounts of gold, in part in place of its huge trillion dollar holdings of U.S. Treasuries. Whether this policy of not reporting its official reserves will continue will almost certainly depend on political expediency - and there's no guarantee that if they are reported at some point in the future they will be the true figure anyway. So the speculation on this will continue.

My view - Fullermoney has long maintained that the Chinese Renminbi would eventually become fully convertible, on its way to becoming an extremely important reserve currency. If correct, it would make sense for China to build up its gold reserves, which it can do more stealthily and therefore cheaply by absorbing domestic production rather than buying in the open market.

My personal portfolio: A new transaction in my long-term investment account - Details and charts are in the Subscriber's Area.


Email of the day - On risk on and off:

"I read an interesting article at a website soberlook.com. The article was titled "The story of two risk indices". They discuss the Credit Suisse Risk Appetite Index and the Fisher-Gartman Risk Index by Dow Jones. These indices were specifically constructed to monitor the "Risk-on-Risk-off" trade. I would appreciate your comments on these indices and is it possible to get one or both of these indices into the chart library?"

My comment - I had a look at the article and the message seems to be that stock markets are now out of "panic mode." I am not sure we need an indicator for either that or 'risk-on-risk-off', since the unusually high levels of correlation that we have seen in recent years, which I attribute to high frequency algorithmic trading, have certainly been apparent across global markets. The Fisher-Gartman Risk Index is in the Library and it looks like a number of equity indices.

To summarise the Fullermoney view on stock markets

This item continues in the Subscriber's Area.

Tim Price: R.I.P. Maestro - My thanks to the author for his iconoclastic, educational and in this instance, satirical letter published by PFP Wealth Management. It is posted in the Subscriber's Area but here is a brief sample in which he is talking about Alan Greenspan:

He went on to work as an ethical advisor to President Nixon, as an appointee to the new Peace Committee established under Henry Kissinger, and was appointed chairman of the US Federal Reserve in 1987 in what was believed to be President Reagan?s first public display of the Alzheimer?s disease to which he would ultimately succumb.

Sixty seconds after his chairmanship at the Fed was announced, the Dow Jones Industrial Average suffered its largest ever points fall in history. Several school parties to the New York Stock Exchange were inadvertently clubbed to death by the bodies of falling stockbrokers. It was at this point that Greenspan uttered the sentence that would usher in three decades of unparalleled stability and calm to the financial system:

"The Fed affirms today its readiness to provide unlimited amounts of dollars to support Wall Street no matter what."

Greenspan is noted for the breadth, creativity and variety of his policy responses, whether it was slashing interest rates following the 1987 "Greenspan? Crash, slashing interest rates during the Asian financial crisis of 1997-8, slashing interest rates ahead of the "Millennium Bug? (a small Ailanthus webworm moth that was born in late 1999), or slashing interest rates after the dotcom bust of 2001. Greenspan would also occasionally slash interest rates just because he felt like it.

He became known for a certain fussily prolix and complex speaking style that some attributed to an old duffer disguising a policy primarily associated with slashing interest rates by means of talking impenetrable nonsense. He showed those critics who accused him of whoring himself out to Wall Street interests on his retirement by taking up paid consulting roles with PIMCO, Deutsche Bank and Paulson & Co.

Greenspan wrote a memoir titled "The Age of Turbulence: Has Anyone Seen My Soap ?? which was published in 2007, shortly after he forecast a thousand year sunlit upland for the US property and mortgage derivative market. Greenspan apparently wrote the book whilst soaking in his bathtub, a habit he employed ever since an accident in 1971 when he incurred a near-fatal duelling injury at the hands of Ron Paul. He came in for guarded criticism when he advised homeowners to take

Additional commentary by Eoin Treacy

Rapidly rising demand should put graphite on investors' radar This article by Sally Lowder for Mineweb dated January 26 th is one of a number of articles I have seen recently extolling the investment potential of graphite. Here is a section:

RF: The most important applications in energy storage are lithium-ion batteries and fuel cells. A lithium-ion battery needs 20 to 30 times more graphite by weight than lithium. Based on that, the number of end user transactions, the amount of capital and the level of interest in the graphite space should be about 20 to 30 times more than in the lithium space, but graphite has been flying under the radar.

TCMR: Maybe that's partly because the lithium-ion battery isn't called the graphite-lithium-ion battery.

RF: True. These batteries have two parts-the cathode and the anode. Lithium is the cathode. The anode is graphite. It's become clear that these batteries will power not only electric vehicles but also our tools, our phones, our laptops, our electronics, our toys. They all use these batteries, and that's going to be a big demand driver.

TCMR: How about in fuel cells?

RF: In the same way, graphite is used in plating and is an important component of a fuel cell. A lot of the same things I said about lithium-ion batteries also apply to vanadium redox batteries. Vanadium's been getting a lot of attention. It takes a lot of graphite to produce these batteries as well.

TCMR: Are the batteries used in vehicles such as the Chevy Volt, Nissan Leaf and Tesla Roadster lithium-ion-graphite batteries?

RF: Yes. There was some debate whether a nickel-metal hydride battery would be the key driver for electric vehicles, and the original Volt was based on that technology. But the Leaf, the new hatchback version of the Volt, and the Tesla are now all based on the lithium-ion-graphite battery.

My view As a purer form of carbon than coal, it would not be correct to describe graphite as rare. However, technological innovation is resulting in a number of additional sources of demand and it may take time for supply to catch up. The penetration of lithium ion batteries in the consumer electronics, automobile and industrial sectors suggests demand for graphite is on a secular upward trajectory.

I last posted a review of battery manufacturers and lithium miners in Comment of the Day on August 18th. This highly informative report from Deutsche Bank covering the lithium ion battery sector and focusing on Japanese companies may also be of interest and appeared in Comment of the Day on January 22nd 2011.

Many commentators expect graphene will eventually replace silicon in computer chips. It also has a number of other potential applications in the materials, defence, construction and electronics sectors. Mass production is still evolving and limited to a relatively small number of companies. Graphene is still one of the most expensive materials to manufacture. However, costs can be expected to come down as an increasing amount of capital is devoted to the sector.

This section continues in the Subscriber's Area.

Brent / WTI Spread To Widen To Around $20 This note by Sarah Kent appeared on the Wall Street Journal website today and may be of interest to subscribers. Here it is in full:

The premium Brent crude commands over Nymex WTI is set to widen back toward record highs seen last year, as increased oil production in North Dakota and stock builds at the U.S. benchmark's delivery point of Cushing, Okla. pressure WTI, Seth Kleinman, head of energy strategy at Citi said Thursday.

"The spread is heading toward $20 again and it needs to get there because all of the esoteric ways of getting oil out of Cushing don't make sense when the spread is under $10," Kleinman told the ETF Securities investment conference in London.

Meanwhile, Brent is very well supported by geopolitical risks to supply, he said.

My view A slow return to economic growth and a surge in domestic supply, not least from North Dakota's shale oil, is contributing to abundant supplies of crude oil in the USA. Concurrently, geopolitical risks in Africa and the Middle East have added a risk premium to Brent Crude prices.

This section continues in the Subscriber's Area.

Living In A QE World Thanks to a subscriber for this well-illustrated article by Barry Ritholz. Here is a section:

Massive central bank involvement in the markets risks returning us to a de facto centrally planned economy. Those S&P 500 companies all have the same chairman; it is Ben Bernanke because his policies are affecting everybody. That is what makes money management so difficult. Correlations will ebb and flow; they always do. But what makes them go away? This will only happen when governments and central banks go away.

But if they go away, then does that not mean things get ugly? Maybe they do get ugly, but it also means that we sort out the excesses in the market. We reward the people that do the right thing and we punish the people that do the wrong thing. And we have an adjustment process that may be ugly, but then we have a period of long expansion.

Central banks are ruling markets to a degree this generation has not seen. Collectively they are printing money to a degree never seen in human history.

My view Central banks have ramped up their support for various asset markets over the last few months. As with previous rounds of quantitative easing, money creation seeps into higher yielding instruments and/or those with the potential for outsized capital appreciation. These also tend to fall quicker than might normally be expected when liquidity is removed.

The most important question right now is how likely is liquidity to be removed?

This section continues in the Subscriber's Area.

Email of the day (1) on a surge in US Treasury Bill yields:

"With monetary spigots loosening over the past few weeks this chart, along with the 31 day T-Bill has gotten my attention. Your take?

My comment Thank you for alerting us to this chart. US 3-month Treasury Bill yields have risen from negative territory to approximately 5 basis points. Stock and commodity markets have bounced impressively over the same timeframe. As a result, the relative attractiveness of negligible yields is beginning to decline.

Email of the day (2) on an addition to the Chart Library:

"Martin Spring's thoughts re the Philippines prompted me to search for ETFs. Could you please place this one in the library: db x-trackers MSCI Philippines IM TRN Index ETF? Thank you."

My comment Thank you for this suggestion which has been added to the Chart Library.

Speaking engagements in the USA - I have accepted an invitation to speak to the Los Angeles chapter of the MTA on April 11th. The venue has yet to be confirmed but will be in the Long Beach area. Non-members are welcome to attend. The topic will be "To Hoard or to Horde: risks and opportunities from participating with the crowd."

I have also accepted an invitation to speak to the San Diego chapter of the MTA in the first week of April. A date and time has yet to be fixed but it will take place in the Del Mar area.

I still have some space available on my itinerary. If you would like me to speak to your local chapter or organisation in California or New York please contact your respective chairperson and ask them to contact me.

The Chart Seminar 2012 - Following a sell-out tour to Singapore and Australia last year, The Chart Seminar will be held in San Francisco, New York and London this year. Please be aware that the early booking rate for non- subscribers at the US seminars expires on January 31st.

We are currently taking bookings for our San Francisco and New York dates in April as well as London seminars in May and November. Anyone interested in securing a place at any of our events should contact Sarah Barnes at sbarnes@fullermoney.com.

The date and venues for my seminars so far in 2012 are:

San Francisco - April 16th &17th 2012 Nikko Hotel

New York - April 23rd & 24th 2012 at The Manhattan Club (above Rosie O'Grady's) at 800 7th Avenue

London - May 25th & 25th 2012 at the Radisson Edwardian Hampshire

London - November 22nd & 23rd 2012 at the Radisson Edwardian Hampshire

The full rate is £950 + VAT. (Please note US delegates, as non EU residents are not liable for VAT). The early booking rate of £875 for non-subscribers expires on January 30th for the US seminars. Paid-up Fullermoney subscribers are offered a discounted rate of £850. Anyone booking more than one place can also avail of the £850 rate for the second and subsequent delegates. 

ASIA

JGBs prices remain steady to slightly higher in the 20-yr and shorter zone, digesting sporadic profit-taking by several regional banks. Large domestic commercial banks were seen buying 3-yr and 5-yr JGBs, while nationwide cooperative banks are buying 15-yr JGBs. At 0630GMT JGBs were trading down 5 ticks at 142.70. (RTRS) 

Chinese Non-Manufacturing PMI (Jan) M/M 52.9 (Prev. 56.0)

Chinese HSBC Services PMI (Jan) M/M 52.5 (Prev. 52.5) 

Chinese Industrial Profits YTD (Dec) Y/Y 25.4% (Prev. 24.4%) (Sources)

US 

T-notes settled in positive territory yesterday, as risk appetite waned slightly and the benchmark yield on the 10y traded close to a four month low. Safe haven flows benefited from the uncertainty ahead of tomorrow's NFP data and remain tentative ahead of next week's Treasury issuance. At the pit close, t-notes settled at 132.05, up 5+ ticks. Finally, the DJIA finished down 0.09% at 12705.34, the S&P 500 finished up 0.11% at 1325.54 and the Nasdaq 100 finished up 0.31% at 2495.83. T-notes were trading broadly flat at 132.06 heading into the European session, as the market awaits the key Non-Farm Payrolls data later on in the session. Last prices taken at 0635GMT. (RANsquawk) 

Fed’s Fisher has warned market participants to view the Fed’s economic and rate forecasts with caution, referring to these forecasts as “pure guesses”. Fisher went on to say that these predictions are “tactical judgements” in a broader plan. He has also reiterated that monetary policy does face limits, and there is only so much it can do to aid employment levels in the domestic economy. Fisher concluded that he does not think the US requires additional monetary stimulus due to the slowly improving economy. (Sources)

The rainy-day funds that US banks have been tapping to boost their earnings could begin to dry up. Some analysts doubt banks can afford to keep up the pace of reserve releases, increasing pressure on profits that are being hit by slow economic growth, low interest rates and tighter rules. (WSJ)

Fed holdings of treasuries totalled USD 1.623trl in the week to Feb 1 vs. USD 1.661trl in the week to Jan 25. The Fed’s balance sheet liabilities were USD 2.907trl Feb 1 vs. USD 2.902trl on Jan 25, with the Fed holdings of agency debt totalling USD 101.5bln Feb 1, unchanged from previous week and finally the Fed discount primary borrowing averaged USD 44mln/day week ended Feb 1 vs. USD 5mln/day week ended Jan 25. (RTRS)

EU

Pressure on Greece’s economy has increased after international debt inspectors admitted an additional EUR 15bln would be needed to fill a newly discovered black hole in the country’s finances. (Guardian)

The Irish government is prepared to stand by its growth forecasts even after the Central Bank cut its predictions, according to Irish PM Kenny. (Irish Times)

The Finance Ministers for Germany, the Netherlands, Finland, and Luxembourg will meet at around 1200GMT and would discuss current topics. A spokesman has said that no statement will follow the meeting. (RTRS)

FX

IMF’s Deputy Managing Director Shinohara has said intervention is an option if JPY moves excessively, however he has added that it would be difficult to do so and that the BoJ should be prepared to use monetary stimulus to defend the JPY. (Sources) Japanese Finance Minister Azumi has said Japan will act decisively against one-sided foreign exchange moves, adding that these speculative moves are increasing due to continuing low US interest rates. 

The NY Fed said that the ECB borrowed USD 7.93bln from its USD-swap facility in the February 1st week, while the BoJ borrowed USD 2.04bln in the same period. (Sources)

Morgan Stanley has cut its EUR end-2012 forecast to USD 1.15 from USD 1.20 due to the ECB’s changing position on providing liquidity. (Sources)

The Swiss Central Bank’s independence is under threat, according to the acting chairman. (FT-More) The independence of the bank is under political pressure concerning the potential cost of interventions, following the departure of Hildebrand as Chairman. Acting chairman Jordan reiterated that the central bank is committed stable policy operations and the ceiling it has set for the CHF, adding that “we are prepared to buy foreign currency in unlimited quantities if necessary”.  The central bank is estimated to have spent CHF 7bln when it stepped into the markets in September. 

COMMODITIES

WTI crude futures were trading up USD 0.20 at USD 96.51 near a six-week low, heading into the European session. Last prices taken at 0630GMT. (RANsquawk)

SocGen revised their 2012 Nat Gas forecast and now expect Nat Gas to average USD 2.40/MMBTU which is down from a Nov'11 forecast of USD 2.90/MMBTU. (RTRS)

China’s net oil imports to see slower growth in 2012, with a rise of 5.98% against 6.3% for 2011, according to China National Petroleum Corp. (Sources)

Iran have denied UN nuclear inspectors access to a suspected nuclear site, dimming hopes for a breakthrough to end the standoff between Iran and various international bodies, according to diplomats briefed by the IAEA. (WSJ)

NIESR has predicted the UK will suffer a modest contraction this year. (FT-More) 

The institute has downgraded its forecast for the year to a contraction of 0.1%. However NIESR has predicted a 2.3% growth rate for 2013. Director of the NIESR Portes, commented that the UK could boost the domestic economy with a cut to employer national insurance taxes or by spending on infrastructure without endangering the credibility of its targets. NIESR has also predicted UK inflation to fall back to 2.2% in 2012.

UK Lloyds Business Barometer (Jan) M/M -11 (Prev. -23) (Sources)

ASIA

Nikkei average closed down 0.51% today, ending three days of gains ahead of key US employment data, despite strong performance from Sony shares. (RTRS)

Sony Corp – Co. shares jumped around 8% after incoming CEO Hirai said he will close down underperforming businesses to help revive the unprofitable company. (Sources)

Panasonic – Co. sees FY loss JPY 780bln vs. Exp. JPY 471bln loss. Co. cites Thailand flooding, the global economy, goodwill and restructuring costs for forecast changes. (Sources)

ICBC – Goldman Sachs is planning to sell USD 1bln shares in the Co., according to unidentified investment bankers. (Hong Kong Economic Journal)

Top performing sectors in Nikkei 225: Oil & Gas (+1.07%), Technology (+0.67%), Utilities (+0.40%)

Worst performing sectors in Nikkei 225: Telecommunications (-2.63%), Health Care (-1.25%), Financials (-0.98%)

US

US equities finished in minor positive territory yesterday following a choppy trading session. There was an initial rally following better than expected initial and continuing claims numbers before the market open, as well as good corporate earnings from Kellogg and Mastercard, and a retracement whilst Fed’s Chairman Bernanke was giving his testimony at the House Budget committee during the session. Investors now look to US non-farm payroll data tomorrow morning, expected to come in at 144K, down from the previous number of 200K.  Finally the DJIA finished down 0.09% at 12705.34, the S&P 500 finished up 0.11% at 1325.54 and the Nasdaq 100 finished up 0.31% at 2495.83 

Top performing sectors in S&P 500: Financials (+0.68%), Oil & Gas (+0.44%) & Consumer Goods (+0.17%)

Worst performing sectors in S&P 500: Utilities (-0.41%), Health Care (-0.38%) & Industrials (-0.16%)               

Gilead Sciences – Co. reported a Q4 non-GAAP EPS USD 0.97 vs. Exp. USD 1.05, Q4 revenue USD 2.20bln vs. Exp. USD 2.18bln with Q4 antiviral product sales rising 9% to USD 1.86bln. (RTRS)

ExxonMobil – Petroleos de Venezuela is negotiating with Co. to pay an arbitration award in crude oil instead of a cash settlement, according to a government source. (Sources)

UK

UK Banks – Proposals by Vicker’s Independent Commission on Banking to erect firewalls around Britain’s retail banks do little to provide protection from unregulated shadow banking, according to NIESR. The proposed rules will drive lenders towards unregulated banking as they seek cheaper forms of credit. (Sources)

BT Group – Co. Q3 Ebitda GBP 1.52bln vs. Exp. GBP 1.49bln. Co. IAS pension deficit increased to GBP 4.1bln net vs. Exp. GBP 3.4bln. Co. have said they expect to achieve 2013 Ebitda target a year early. (Sources)

Investec – Co. 9M Operating Profit down 5.6%. Co. says targeting minimum tier 1 capital ratio of 11%. Co. 9M income from principal transactions down 31.3%. (Sources)

Barclays – BarCap is said to be planning 25-30% pay cut for staff. (Sources) 

Glencore/Xstrata – S&P said that both co.’s ratings were unchanged following the merger talks between the Co.’s. (RTRS)

Companies paying dividend: Vodafone (GBP 0.3388), Lonmin (USD 0.1666)

OTHER UK 

Hays - Adecco could be lining up a GBP 2.10bln or GBP 1.50 per share cash bid for the Co. (Daily Mail)

Misys – Co. says it is in talks with Temenos over a possible merger, adding that there is no certainty a transaction will take place. (Sources)

FRANCE 

SocGen – Co. CEO said he would oppose a law that would split the activities of retail and investment banking. (RTL)

Vinci – Co. has been awarded five road maintenance contracts in the UK with a total value in excess of EUR 1.7bln. (RTRS) 

Lafarge – Co. is to cut 460 jobs as part of a reorganisation of corporate functions. (RTRS)

Axa – Co.’s private equity arm has sold its shares in Russian funds that are under the management of Marshall Capital Partners. (Vedomosti)

STM – Fitch revises co. outlook to negative from stable. (Sources)

EADS – According to press reports, UAE could announce an order for 60 Rafale planes from Dassault Aviation, which is part owned by the co. (La Tribune)

GERMANY

German banks – According to BaFin, German banks are set to reach the EU bank regulatory capital targets on their own strength. (Sources)

OTHER GERMAN

Sky Deutschland – Co. plans to raise EUR 300mln from capital markets. (Boersen-Zeitung)

PAN EUROPEAN

Generali – Co. has no intention of dissolving its joint venture with the Czech firm PPF. (Finanza & Mercanti)

Volvo – Co. Q4 sales SEK 86.5bln vs. Exp. SEK 81bln. Co. Q4 Operating Income SEK 6.96bln vs. Exp. SEK 7.45bln. Co. adds that it will keep Northam, Europe truck market view for 2012. Co. says re-organization process remains on track. (Sources)

Bankia – Co. which was originally expected to announce Q4 results today is set to release the trading statement on 24th Feb instead. (Sources)

Repsol – According to sources, co. has begun drilling its first well in its E&P programme offshore Cuba. (RTRS)

SMI

UBS/Credit Suisse – Switzerland’s competition regulator has opened an investigation into co. and more than 10 other foreign banks on possible manipulation of LIBOR and TIBOR rates. (Sources)

ABB – Co. holds 95.02% in Newave Energy Holding according to the published definitive interim results. (Neue Zuercher Zeitung)

BROKER MOVES

RBS DOWNGRADED TO HOLD FROM BUY AT DEUTSCHE BANK

SHELL CUT TO EQUAL WEIGHT FROM OVERWEIGHT AT Barclays

XSTRATA UPGRADED TO NEUTRAL FROM UNDERPERFORM AT EXANE

ASTRAZENECA RAISED TO BUY VS NEUTRAL AT SWEDBANK

UNILEVER CUT TO HOLD FROM BUY AT SOCGEN

SCHRODERS ADDED TO UBS’S LEAST PREFERRED LIST

BNP PARIBAS RAISED TO BUY FROM HOLD AT DEUTSCHE BANK

DEUTSCHE BANK CUT TO NEUTRAL FROM BUY AT NATIXIS

MUNICH RE RAISED TO BUY VS ADD AT COMMERZBANK

SANTANDER RAISED TO ADD FROM NEUTRAL AT WESTLB

BBVA CUT TO SELL VS NEUTRAL AT UBS

The intersections reported today included 4.19 metres grading 6.94 grammes per tonne (g/t) from the California vein and 7.37 metres at 6.31 g/t gold from the India vein.

Ovoca Gold also released an operational update. The company said that at it has discovered gold and silver mineralisation at the Podgorniy and Zet Prospects within its Rassoshinskaya license in Russia that warrants additional field work for 2012.

The best results included an intersection of 10 metres at 7.9 g/t gold and 10.9 g/t silver at Podgorniy and an interval of one metre at 14.2 g/t gold and 121 g/t silver at Zet.

Finally, Nyota Minerals, whose main asset is the Tulu Kapi gold mine in Ethiopia, has placed 161 million shares to raise £9.66 million.

Nyota said the placing has been supported by new and existing shareholders including Centamin Egypt (LON:CEY), which will now own a 14.08 percent stake in the company.

The placing will allow Nyota to progress Tulu Kapi after completion of the definitive feasibility study (DFS) but before project finance, as well as maintain momentum with exploration drilling of its Northern Block exploration properties.

“Although the market remains relatively untested for fundraisings in 2012, there are signs that many exploration companies intend to raise finance in the next four months and the Board of Nyota felt it essential that we ensure adequate working capital to maintain our focus on our objectives beyond the end of the current financial year,” said Nyota chief executive Richard Chase.

Clean energy group Kedco (LON:KED) also provided a funding update today, announcing that it has raised £403,000 through a placing of 31 million new shares at a price of 1.3 pence per share.

The proceeds will be used for working capital purposes and for continuing investment in the Company's portfolio of biomass electricity and heat generation projects.

Back to mining companies, VANE Minerals (LON:VANE) has confirmed that it has drilled a copper-molybdenum porphyry system at its McGhee Peak project on the Hillsboro-Chino-Tyrone-Bisbee porphyry mineral trend in southwest New Mexico.

The drilling has discovered two mineralised targets located one mile apart within a clearly identified porphyry system, containing copper, molybdenum and zinc.

Copper values ranged between 300 and 600 parts per million (ppm), while zinc values topped 200 ppm.

“These are encouraging results, showing a mineralised porphyry and confirming our geological theory that the porphyry systems that have been successfully discovered and mined at surface in this part of the U.S., also occur at depth,” said chief executive of VANE David Newton.

The company plans more drilling over the coming months to confirm whether this porphyry has economic potential.

In oil and gas, Wentworth Resources (LON:WRL) has spudded the onshore Ziwani-1 exploration well , the first new well to be drilled in the Mnazi Bay concession area since the MS-1X exploration well was drilled, logged and tested in 2007.

The well is targeting Miocene and Oligocene sandstones, similar to the reservoirs of the Mnazi Bay and Msimbati gas fields.

The well is expected to take 35 days to drill.

Wentworth, which holds a 52.225 percent participating interest in the well, will cover 30 percent of the costs.

“We are excited to start the year with a high impact work programme that has the potential to deliver significant asset growth and shareholder value in 2012,” said managing director Geoff Bury.

“The carried interest we enjoy in the Mnazi Bay concession provides full participation with reduced financial exposure.”

In the meantime, Gulf Keystone Petroleum (LON:GKP) has secured regulatory approvals to transfer its interest in the Hassi Ba Hamou permit in Algeria to BG Group and Sonatrach.

It is part of a strategic exit from the country which will allow the company to concentrate on its assets in the Kurdistan region of northern Iraq.

Oil and gas company with assets in Morocco and Australia Tangiers Petroleum (LON:TPET) has joined the AIM market of the London Stock Exchange today. The company said that along with its Australian listing, the London quote broadens its access to capital from international investors.

Elsewhere in the markets, software group Misys (LON:MSY) confirmed it is currently in discussions with Temenos Group AG over an all-share merger.

“Discussions are continuing and there can be no certainty that a transaction will ultimately take place, nor as to the terms on which any transaction might be constituted,” Misys said in today’s statement.

In other news, pub group Fuller, Smith & Turner (LON:FSTA) has bought 15 freehold, tied, tenanted pubs from Enterprise Inns for £22.9 million, which will be paid from the group’s existing bank facilities.

Under Enterprise's ownership, these pubs generated operating profits of £1.7 million in the financial year ending September 30 and had a balance sheet value of £18.4 million as of that date.

The group said the pubs will allow it to bring the Fuller's brand into areas of the west and south east of England, where it said it has been under-represented.

The acquisition takes the total number of pubs bought by Fuller, Smith and Turner over the past 12 months to 29.

The two drill holes were  a mile apart and had found two targets within a clearly identified porphyry system, containing copper, molybdenum and zinc, it added.

The drills encountered copper values in the range of 300-600 ppm, with zinc values greater than 200 ppm.

One hole showing visible molybdenite is being re-drilled after caving while there will be  further additional drilling to determine if economically viable higher grades are present.

David Newton, VANE’s chief executive, said: "These are encouraging results, showing a mineralised porphyry and confirming our geological theory that the porphyry systems that have been successfully discovered and mined at surface in this part of the US, also occur at depth.“

“Further drilling is required over the coming months to confirm whether this porphyry has economic potential. This successful drilling result at what is only our third project on this very favourable mineral trend gives us confidence of further exploration success in our remaining projects, " he added.

VANE added that the drill currently working at McGhee Peak will be moved to its next copper target once the re-drilling of hole MP-1 is completed as additional drill holes will require permitting. Permitting of the additional holes at McGhee Peak is underway.

VANE’s focus is the porphyry copper systems of the south-west US, and its targets on either side of the Arizona-New Mexico border. This is an area that is home to 60 per cent of all US production of the metal.

McGhee Peak is located on the Hillsboro-Chino-Tyrone-Bisbee porphyry mineral trend in southwest New Mexico.

Isarene hosts the world class Ain Tsila gas field. 

The deal was first struck in April last year. Petroceltic says it is now owed over US$100 million from the deal and payment is due in the next 30 days.

"We are delighted to announce the completion of the Enel farmout and formally welcome our new partner to the Isarene Licence,” said chief executive Brian O'Cathain.

“Since announcement of the deal in April 2011 we have forged a valuable and co-operative working relationship with Enel and Sonatrach, culminating in the completion of the highly successful appraisal campaign. 

“We look forward to a long and successful relationship in this outstanding asset."

Under the terms of the deal, ENEL agreed to pay to US$36.75 million to Petroceltic. This gives the firm more than 24 per cent of all back costs incurred from 2005 until the end of the exploration period in April 2010. 

Additionally ENEL had to commit to funding 49 per cent of the costs associated with the recently completed six well appraisal drilling programme. These costs are capped to a maximum of US$145 million.

Furthermore, there is a further potential payment which is contingent up the outcome of future appraisal as well as future reserve volumes and production volumes. This could be worth as much as US$75 million for the company.

The company now retains a 56.625 per cent interest in the licence while Algeria’s national oil company Sonatrach owns 25 per cent and ENEL owns 18.375 per cent.

Earlier this week broker Daniel Stewart came out with a bullish assessment of Petroceltic. It says the firm has a well diversified asset base that has ‘game changing’ potential.

The bullish view is reflected in the broker’s punchy price target, set at 13.7p, which implies nearly 70 per cent upside from the current price of 8.2p a share.

Gulf Keystone Petroleum (LON:GKP) has received permission to transfer its interest in the Hassi Ba Hamou permit in Algeria to BG Group and Sonatrach at no cost. 

The receipt of formal government approvals ends a process that began back in 2010.

It is part of a strategic exit from the country which will allow the company to concentrate on its world class oil assets in Kurdistan, the semi-autonomous region of Iraq.

Todd Kozel, company’s chief executive, said:  "We are pleased that with the HBH transfer we have made good progress towards achieving our goal of a gradual strategic exit from Algeria. 

“We are firmly focused on our operations spanning four exploration blocks in the Kurdistan Region of Iraq, including the Shaikan world-class discovery, where the 2012 and 2013 high impact drilling campaign is currently underway following excellent results achieved in 2011.”

The flagship Shaikan block is estimated to contain 8 billion barrels of crude calculated on a P90 basis – meaning the oil has a 90 per cent certainty of being produced.  The P10 value is 13.4 billion barrels, giving a mean figure of 10.5 billion barrels.

The last update was possibly one of the most encouraging so far as the company’s chief operating officer, John Gerstenlauer, said the Shaikan-4 may be the best well it has logged to date.

It achieved a flow rate of 4,970 barrels and 7 million standard cubic feet of gas a day from a thin zone at the bottom of the lower-lying Kurre Chine B formation.

The oil was a 39 degree API light crude, while the gas flowed at a wellhead pressure 1,101 PSI. 

In the Kurre Chine C, Shaikan-4 achieved a flow rate of 563 barrels a day and flowed 3.65 million cubic feet of gas. These were two of seven planned well tests.