West African Resources Ltd


WAF Details
 
Capital raising to enhance balance sheet:West African Resources Ltd (ASX: WAF) raised $21 million to accelerate development of Tanlouka Gold project and strengthen its balance sheet. The placement is made to existing shareholders and leading institutional investors. Definitive Feasibility of 100% owned Tanlouka Gold projects is expected to complete in Q42016. On the other side, recently the Ministry of Environment, Green economy and Climate change has given permission to WAF for mining the Tanlouka Gold project.
 

Tanlouka Gold Project (Source: Company Reports)
 
Meanwhile, the group reported that the project mineral resources now have 9.8 MT tonnes at 2.1g/t Au for 670000 ounce of gold and a further 10.7 Mt tonnes at 2.0 g/t/ Au for 695,000 ounce of gold. Furthermore, the group reported a 34% increase in mineral resources for Tanlouka gold project. M1South indicated mineral resource of 290,000 tonnes at 10.3g/t Au for 96000 ounces of gold and inferred mineral resource of 410,000 tonnes at 6.4 g/ Au for 83,000 ounces of gold.  The stock increased by 407.04% over last one year (as of August 19, 2016), and still we recommend a “Speculative Buy” on the stock at the current market price of $0.34
 

WAF Daily Chart (Source: Thomson Reuters)
 
Mineral Deposits Ltd


MDL Details

First positive EBITDA at GCO: Mineral Deposits Ltd’s (ASX: MDL) primary assets is 50% interest in the Tizir JV which owns the Grande Cote mineral sands operation (GCO) that has reported first positive EBITDA since completion of construction. On the other side, MDL’s cash position is at $6.7 million but debt is at $7.2 million while underlying net loss for first half 2016 reached $19.8 million. MDL’s share of TiZiR’s underlying loss is at $18.9 million. On the other hand, in its Q2FY16 operational review, the reported record sales for zircon, retile and leucoxene. GCO achieved a record average throughput in June of 7,350 tph. The group exited position in World Titanium resources and received $6.45 million in April.
 

Grande Cote mineral sands operation performance (Source: Company Reports)
 
On the other hand, the group witnessed an operational incident at the TiZir Titanium and Iron ilmenite upgrading facility leading damage to the surrounds of the furnace. The group expects a preliminary cost to repair over US$5 million (on a 100% basis). But we believe the group would be able to handle this situation as there are insurance covers against these risks. MDL stock generated over 37.31% returns in the last four weeks (as at August 19, 2016) and we give a “Speculative Buy” recommendation on the stock at the current market price of $0.435
 

MDL Daily Chart (Source: Thomson Reuters)
 
Tiger Resources Ltd


TGS Details

Improved grid power supply:Tiger Resources Ltd (ASX: TGS) reported June quarter (Q2FY16) activity report and informed that there has been improvement in grid power supply with grid supplying 80% of Kipoi’s electricity for the quarter and 60% year to date. But the Q2FY16 copper production was at 5,541 tonnes and sales reached 6,052 tonnes at $4,792/ tonne. This is down from 6,162 MT in Q1FY16, as the performance was mainly impacted due to reduced recoveries from the heap leach circuit early in the quarter. The second drawdown on the senior facility of US$9.7 million was completed with total drawn senior facility of US$142.9 million. TGS lately guided FY16 production of 25,000 – 26,500 tonnes of copper cathode, which is down from its earlier guidance of 26,000-28,000 tonnes. On the other hand, the group expects cash operating costs of $1.4-1.46/b and ASIC of $1.62-1.7/b (against previously announced cash operating costs of $1.34-1.42/b and ASIC of $1.56-1.65/b). Moreover, Tiger informed that it has a resource of 40,000 tonnes of oxide ore measured and indicated, and 5,600 tonnes of inferred cobalt across the Kipoi project. We give a “Speculative Buy” recommendation on the stock at the current price of $0.039
 

TGS Daily Chart (Source: Thomson Reuters)
 
Pioneer Resources Ltd


PIO Details

Planning lithium drilling program:Pioneer Resources Ltd (ASX: PIO) received strong support from investors as company prepares for an extensive lithium drilling program. Pioneer completed $4.8 million raising through share purchase and placement of circa at issue price of $0.036 per share with one option for every three shares subscribed for and issued at $0.06. Moreover, Pioneer with International Lithium Corporation is planning $1 million in exploration expenditure in 2016 on the Mavis and Raleigh lithium pegmatite project at Canada. PIO has set C$1,000,000 budget for 2016-17 financial year for drilling.  Pioneer further prepares to drill lithium-prospective Pegmatite corridor, which is expected to begin during September 2016. The company has outlined a 5000 reverse circulation program at the Pioneer Dome Project in Western Australia. For Blair Nickel Project, EIS funding award of up to $86,500 is planned for drilling, which is expected to be scheduled for December 2016 quarter. Considering the current lithium boom and PIO’s potential, we recommend for a “Speculative Buy” on the stock at the current price of $0.021
 

PIO Daily Chart (Source: Thomson Reuters)
 
Troy Resources Ltd


TRY Details

Operating costs contained despite various challenges at Karouni: Troy Resources Ltd (ASX: TRY) reported its June quarter performance with gold equivalent production for FY16 of 82,826oz while Karouni gold production for the quarter was of the order of 14,545oz. C1 Unit Cash Cost was US$658/oz for the quarter and US$515/oz. from 1 January 2016. TRY’s revolving debt facility has also been restructured with Investec on more favourable terms and this is said to enhance exposure to the spot gold price as production increases. TRY’s Karouni operations were able to maintain a relatively low cash cost despite all the setbacks indicating for a positive sign for future margins.
 

Operations Results (Source: Company Reports)
 
The company otherwise faced various challenges including debilitating weather conditions, a more complex ore body than anticipated and other problems in the mill operation. The company had received US$1.99 million from Anfield Gold for the sale of the Andorinhas Plant while the final payment of US$1 million is due late February 2017. The stock fell 18.9% in the last three months (as of August 19, 2016) while rising 5.9% in the last five days. We put a “Speculative Buy” recommendation on the stock at the current price of $0.505
 

TRY Daily Chart (Source: Thomson Reuters)

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