Bezant Resources plc (LON:BZT) has thrown its weight fully behind its platinum and gold assets in Colombia and written off its interest in the Mankayan project in the Philippines.
Bezant appointed local firm Exumax as its contractor in Colombia in September.
In November, Ed Nealon, chairman, said all machinery, earth-moving equipment, processing plant and work crews was on site and work on the first exploration test pits had commenced at licence FKJ-083 in the Choco region.
Nealon, a South African platinum mining veteran, is optimistic over the potential.
“We identified that there are promising near surface alluvial platinum projects in the famous Choco district, a region that had previously been the world's major source of platinum prior to the discovery of the Bushveld Complex in South Africa."
Bezant calls time on Mankayan..
After attempts to sell the copper/gold project at Mankayan, Bezant bit the bullet and took an impairment charge of £8.3mln as the uncertain mining environment in the Philippines meant a deal was unlikely.
It also meant an after–tax loss of £9.1mln for the year to June 2016.
..to focus on Choco
Bezant acquired the new platinum and gold licences in the Choco from a company called Leeward Island Resources.
The region is a historic heavyweight in platinum production and the deal involved the payment of a US$1mln option fee and a further US$1mln in shares.
Bezant is moving quickly to establish the potential of the FKJ-083 licence area through correlating historic mining data with current exploration.
After that will come a first alluvial plant for platinum and gold with cashflow to be used to fund further exploration and evaluation to establish new production zones.
Valuation suggests option money
The market’s current valuation of Bezant is just under £4mln at 1.95p.
It’s not much and suggests the company will have to prove the potential first before it gets any credit.
One positive of that, though, is that it should mean any good news that does come out should impact markedly on the share price.
but team has experience and knowledge
Nealon is aware that any miner that can secure a meaningful source of platinum outside of South Africa (which dominates supply) should find itself highly sought after.
He should know the market given he was a driving force behind the rise of Aquarius Platinum (LON:AQP) in the last decade and also a co-founder of Sylvania Platinum.
Both Aquarius Platinum and Sylvania Platinum operated in the famous Bushveld Complex in South Africa.
The Bushveld Complex is the world's most significant platinum producer, but it is high cost, deep mining in a very uncertain political environment.
In Choco, Bezant will have the benefit of near surface alluvial gravels that contain both platinum and gold deposits, and both metals are recoverable in their native state.
“The mining conditions in Colombia are very simple compared to the Bushveld Complex,” he said.
“The Bushveld Complex essentially involves deep, hard rock mining operations with considerable metallurgical complexity involved in liberating the economic metals.”
In the past, Colombia has been considered to be a high risk country, but the political and investment situation has also improved dramatically in recent years, he added.
“Modern day Colombia has experienced nearly half a decade of new investment.”