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UPDATE - Stratex International and Centerra switch focus in Turkey

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Stratex (LON:STI) and Centerra have switched the emphasis of their joint venture in Turkey and will now concentrate solely on the Enez gold project in Thrace.

Originally, Centerra’s earn-in agreement had earmarked US$500,000 for a project at Altunhisar but exploration there indicated there was little chance of making a gold discovery.

Centerra now has the option to acquire a 51% interest in Enez, with a minimum of US$145,000, the remainder of the original deal, to be spent by June next year and two further tranches of US$500,000 by end 2015.

The Canadian group can then increase its interest in Enez to 75% by spending a further US$2mln.

Stratex will manage the initial exploration programme and chief executive Bob Foster said the change of emphasis to Enez showed the good working relationship that has developed between our two companies.

Early exploration work at Enez had identified low but anomalous concentrations of gold in volcanic rocks similar to those that host the Ӧksüt discovery and a soil-sampling programme currently underway will determine how best to extend the programme following the end of winter.

Centerra and Stratex have an alliance over a number of other potential gold targets in central Turkey.

City broker Northland, which rates the stock a 'buy', noted that the firm has already started a soil-sampling programme at Enez with follow-up work expected to begin in the second quarter of 2014.

"The renegotiated option agreement is another positive development for Stratex that will see another project in its portfolio advanced with no financial commitment from Stratex, de-risking its exposure to the project.

"Stratex continues to look significantly undervalued considering its impressive track record of discoveries and significant cash balance," says analyst Dr Ryan Long.

Northland has a target price of 12.8p on the shares, which is a hefty increase on the current price of 4.125p.

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Price: 0.38 GBX

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