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    Further evidence that consolidation on the horizon in Africa:

    Eckhof argues case for Spinifex
    Michael Quinn
    27 November 2002

    FRESH back from a round of roadshows in Europe and North America, Spinifex Gold managing director Klaus Eckhof has told of a growing Canadian love affair with Tanzanian gold explorers.

    Eckhof pointed to the capitalisations versus assets of Canadian companies active in the East African country - Tan Range Exploration ($70-100 million), Minieres du Nord ($40 million) and Lakota Resources ($20 million) - as proof Spinifex Gold, which is capitalised at around $33 million, remains comparatively undervalued.

    According to Eckhof, Tan Range's assets comprise around 300,000 ounces (grading about 1.5 grams per tonne) and around $2 million cash, while Minieres du Nord has around 300,000oz and $8 million of debt, and Lakota is a grassroots explorer with $60,000 cash.

    Spinifex, meantime, has around $12 million in cash and properties containing 2 million ounces, although the 730,000oz at 6.32gpt at Nyakafuru is part of a joint venture where Resolute is earning a 66% stake by spending US$5 million.

    Undoubtedly of relevance for Canadian investors in valuing Tan Range is the management, which comprises the former Sutton Resources team that found the huge Bulyanhulu deposit in Tanzania, currently being mined by Barrick Gold.

    Sutton's capitalisation rose from US$15 million to US$325 million when taken over by Barrick in March 1999.

    Eckhof also concedes that with Resolute holding 7.65%, African Lion 25.52% and Lion Selection 18.18%, liquidity is not one of Spinifex's strong points, as compared to Tan Range, for example.

    "We're looking around for consolidation in the industry worldwide," said Eckhof, who also commented that he continues to actively advance discussions about possible deals.

    "I work very closely with African Lion and Lion Selection and they support me in what [Spinifex] is doing," Eckhof said.

    Asked what the relationship was with Resolute, Eckhof answered: "Not bad ... the question is can they pay what we want?"

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