Mining chiefs get it together at Cape Town's Indaba
Garimpeiro
February 6, 2012
GARIMPEIRO
AFTER a happy summer hibernation, Garimpeiro's attention has turned to South
Africa where the annual Mining Indaba conference is in full swing in Cape
Town.
''Indaba'' comes from the Zulu word for ''business'' and among the Zulu and
Xhosa peoples of southern Africa it describes an important conference
featuring the representatives of different communities.
The Mining Indaba, now in its 18th year, is attended by resource companies,
geologists, fund managers and financiers. About 6500 people have descended
on Cape Town to do what mining types do best - network, drink and strike a
deal.
With that in mind, Garimpeiro couldn't help but note that Deloitte has
chosen this year's Mining Indaba as its new ''Insomnia Index'', a survey
that identifies just what is keeping leaders in the mining sector awake at
night.
Deloitte plans to survey as many attendees as possible to take part in the
Deloitte Insomnia Index, an ''online tool that captures the most significant
challenges and opportunities mining companies face when expanding into
Africa''.
Sleep, Garimpeiro can assure readers, has never been high on the agenda at
Mining Indaba.
''This is my fourth Indaba and I can assure Deloitte it's a very specific
type of gold digger that keeps many mining types awake long into the
night,'' one Australian attendee said. Couldn't have put it better
ourselves.
IKIN EYES OPTIONS
One Australian who has joined the exodus to Indaba is Colin Ikin, the
chairman of Namibian Copper.
Just two weeks ago Namibian Copper struck a deal with Canada's NGEx
Resources to acquire its Mogoraib River exploration licence in Eritrea - and
most importantly, the Hambock copper-zinc project that's a central part of
it.
Hambock contains a JORC-compliant mineral resources estimate including 550
million pounds of copper and 1.2 billion pounds of zinc. It's also located
15 kilometres from the new Bisha goldmine opened by Nevsun Resources, which
has produced first-phase, year-to-date production of 379,000 ounces of gold.
It took Ikin the best part of eight months to land the Hambock deal. NGEx
has taken 50 million shares of Namibian Copper, plus a $7.5 million cash
payment upon the successful commencement of commercial mining operations in
Eritrea.
''We're very excited about it,'' Ikin told Garimpeiro over the weekend. He's
at Indaba hoping to drum up some more investment interest in the project.
''We've budgeted $2 million on drilling in Eritrea this year and there are
already two drilling rigs on the site that have been there since November.''
At its current share price of 15.5¢, it makes Namibian Copper a resource
play with an effective value of 0.8¢ a pound of copper equivalent - a
bargain basement price, when one considers there are other companies on the
stock exchange valued at about 5¢ a pound of copper equivalent.
''In those terms, I think we're the cheapest copper play on the ASX,'' Ikin
said. Of course, there's a good reason for that pricing - Eritrea, like so
many parts of Africa, comes with its own sovereign risks.
''It's not something we hide from,'' Ikin said. ''Eritrea comes with its own
set of issues and problems that need to be dealt with. That said, the latest
United Nations resolutions seem to be a step in the right direction.''
Ikin was referring to Resolution 2023, passed in December by the UN Security
Council, which metes out new sanctions on the government of Eritrea.
Specifically, the resolution deals with concerns with the ''use of the
Eritrean mining sector as a financial source to destabilise the Horn of
Africa region''.
There's still a long way to go, but Namibian Copper will stay on
Garimpeiro's radar.
Read more:
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http://www.smh.com.au/business/mining-chiefs-get-it-together-at-cape-towns-
indaba-20120205-1qztz.html#ixzz1lbHBi3b5>
http://www.smh.com.au/business/mining-chiefs-get-it-together-at-cape-towns-i
ndaba-20120205-1qztz.html#ixzz1lbHBi3b5
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Received on Mon Feb 06 2012 - 11:17:13 EST
