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Energio: AGM to vote on change of activities, focus on major Nigerian iron ore opportunity


Energio (ASX: EIO) is conducting some very important business at the company's Annual General Meeting today, including the vote on a change of activities.

The ASX has this morning granted a suspension pending compliance with Chapters 1 and 2 of the listing rules.

Where the story gets really interesting for Energio is that the company is developing a world class iron ore opportunity at the Agbaja Iron Ore Exploration Project in Nigeria, which has resource potential of 1 to 2 billion tonnes of iron ore.

Proactive Investors analysis

Energio ticks many of the boxes as it moves to explore and develop the advanced Agbaja project:

- Experienced board of directors
- Proximity to infrastructure
- Large scale resource opportunity
- Lower relative risk
- Resource rich and high growth country

The board of directors has a track record of developing and financing large scale resource projects.  Kogi State is home to the largest iron and steel factory in Nigeria with the full backing of The Federal Government of Nigeria.

The licenses have close proximity to existing rail; road and power infrastructure provides potential advantages in reduced capital expenditure and allows fast track project development.

Energio aims to complete field programs and drilling program in 2011 with a target of maiden JORC Resource in the March quarter 2012.

Energio has a strong cash position of $4.7 million, which is sufficient to complete the current round of drilling,  and take Agbaja to initial resource estimation in mid 2012. 

However, at the current valuation of the company of just $20 million there is no shortage of upside potential for a company moving in on a 1 billion plus iron ore target with proximity to infrastructure. Energio is one to watch as its valuation does also not take into account the exploration upside at the advanced Agbaja project.

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