Oriole Resources: Morphing into an African Explorer

New image and impetus from an overhauled management team
Company is refocused on African projects
Earning in on projects in Cameroon - a relatively new frontier
Potential revenue streams from legacy Turkish project portfolio
A major as a joint venture (JV) partner in Senegal in the form of IAMGOLD
Africa is again being seen by investors as the most prospective and least explored territory in the mining universe
Cash stood around £1.3mln at the end of December, with another £0.5mln due in from the taxman in the near future

This company may be familiar to many investors under its previous guise as Stratex International, when its focus was as a hybrid developer/project generator, with a strong bias towards Turkey.

Now Oriole Resources PLC is primarily an exploration company, operating in Africa and Europe but with some legacy exposure through investment in, and royalties on, the projects it incubated in Turkey since its listing in 2006.

Oriole is focused on early-stage gold exploration in Cameroon and the more advanced Dalafin gold project in Senegal, where Iamgold has the option to spend US$8mln to earn a 70% interest.

It also has residual interests and royalties in projects in Africa and Turkey that it anticipates will generate cash flow (and capital gains) in the future.

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Executive summary

The great mining slump of 2012-16 caused many miners to question their models. Oriole (then Stratex) also did so and headed in a different direction pursuing advanced stage assets, but has now returned to basics with a focus on exploration in Africa and husbanding its Turkish asset portfolio. The company represents a hybrid of explorer and royalty company. The development is in Africa and the royalty business is primarily net smelting royalties on long-held Turkish assets.

Africa is a go-to location again and with Iamgold as its partner in Senegal, it is in good company. The "closeology" in Senegal is impressive with many household-name projects in near proximity. Meanwhile, the company is cutting its coat to suit its financial cloth with the evolution and exploration of its two targets in Cameroon.

Quick facts: Oriole Resources PLC

Price: 1.15 GBX

LSE:ORR

Market: LSE

Market Cap: £17.86 m

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