Extract gets market thumbs-up

EXTRACT Resources, the Australian-based exploration company owning the world class uranium deposit at Rössing South, has been a ‘stand-out sharemarket performer’, independent experts Resource Capital Research (RCR) say in their latest quarterly report.

Since Extract’s announcement in January that they’re sitting on at least 108 million pounds of U3O8 at 430 parts per million at Rössing South Zone 1, their stock has upped by 200 per cent, the researchers say, reiterating the world class potential of the deposit. They put the total gross value of the company’s resources at US$15 billion, nearly N$135 billion at yesterday’s exchange rate, and say that the current rate of development could see production starting in 2012.The flattering review comes as Extract, whose major shareholders are Kalahari Uranium (38,2 percent) and Rio Tinto (15,5 per cent), embarks on a feasibility study at Rössing South. Company Managing Director Peter McIntyre on Friday released a statement confirming that Extract selected ‘a highly experienced and capable team’ with ‘strong uranium and Namibian experience’ to conduct the study. The project consists of two stages: a pre-feasibility study, followed by a definitive feasibility study.According to McIntyre, leading consulting group GRD Minproc will run the study from Perth, Australia. The company has extensive experience in Namibia and have worked on several primary uranium alaskite deposits locally.McIntyre said comminution and metallurgical test work has already commenced at Rössing South. The Australian Nuclear Science and Technology Organisation Minerals Division (ANSTO Minerals) with its world-renowned capability and expertise is doing the metallurgical tests.Extract furthermore announced that Inge Zaamwani-Kamwi, the Managing Director of Namdeb, has been appointment as an additional independent director of the board, effective immediately.’Zaamwani-Kamwi’s appointment has come at a very important stage for the company as we enter a new phase of growth with our Namibian project. She brings invaluable mining and Namibian expertise to the board, and is a highly respected business leader in Namibia,’ McIntyre said.Analysing the individual deposits, RCR describes results at Rössing South Zone 1 as ‘excellent’ and those at Zone 2 as ‘spectacular’, adding that it is the highest grade granite-hosted uranium deposit in Namibia.’We anticipate a total Rössing South resource of more than 220 million pounds in the third quarter of 2009, with only 6 km of the total 15 km Rössing South strike drilled,’ RCR says.Resource definition drilling at Ida Dome, about 20 km south of Rössing South in the Namib’s Garnet Valley, is finished and RCR expects an update in the second quarter of this year.Exploration at Extract’s Hildenhof and Uis interests are still in its early stages.According to RCR, Extract’s market capitalisation is nearing A$1 billion, or some N$6,4 billion. The company has an annual exploration budget of about N$129 million, while its cash reserves total nearly N$154 million.In RCR’s view, Extract poses ‘an excellent risk/reward investment despite recent huge gains’ for investors.’With total reserves of about 220 million pounds in the third quarter of 2009, and Rio Tinto now holding 15,5 percent the shares still look undervalued,’ the market watchers say. jo-mare@namibian.com.na