STT strata mining corporation limited

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    Midas Gold Expects To Make Money Out Of Its Tasiast Gold Project In Mauritania.


    A small, but ambitious mining company called Midas Gold is on its way around London seeking to raise around £5 million and list on AIM. This is no dual listing and it is passing strange that we have not had a company of that name doing the rounds before as it is such an obvious one. Midas, in fact, was initially called Tasiast after its main gold project in Mauritania, but the management realised that this was hardly a name that tripped off the tongue and it might become a bit mangled. It was as the Tasiast project that it was first identified by the Mauritanian Geological Survey; Tasiast while whole owned and explored by Normandy La Source; and Tasiast when acquired by a private company, led by Strata Mining of Australia, which adopted the name. Now it is Midas and its current lineage goes back to Strata with 54 per cent and St Barbara Mines as well as a few other shareholders.

    Strata, it will be remembered, has a significant shareholding in St Barbara and it is interesting to see that Ross Calnan, the chief executive, was formerly general manager of operations for St Barbara and most recently managed the Paulsens project acquired last year. He is an experienced mining engineer and therefore just the man for Midas’s Tasiast project as it is close to completing a bankable feasibility study. One can be as sure as eggs that the project will be robust as nobody in their senses is going to pay around £3 million for a project that is questionable and, in fact, SRK Consulting has reviewed the pre-feasibility and confirms the quality of the project.

    Normandy is said to have spent over US$14 million on 25 kms of trenching, 25 kms of RC/RAB drilling and 3.3 kms of diamond drilling. The result is an inferred resource of over 1 million ounces, but the drilling was too widely spaced for it to qualify for JORC standards as it stands. However there is thought to be plenty of potential to increase this resource as the deposit has only been drilled to a maximum of 150 feet and is open at depth . There is also considerable untested strike length and potential for high grade shoots which have already been intercepted down plunge grading 22.1 g/t gold over 43.5 metres.

    The money being raised by Midas will therefore be used for further drilling to upgrade resources into reserves, carry out further metallurgical and design testwork, and complete the feasibility. There is not much doubt that it will be taken into production as quickly as possible and Ross Calnan looks the man for the job. Some things are on his side, such as the fact that there are oxidised outcrops at surface and this soft ground goes down for around 50 feet before hitting the banded ironstone formation. The geology and metallurgy look pretty simple and he seems confident that he can lay hands on a standard 1.5 million tonnes/annum CIP/CIL plant in Australia at the right price.

    It is then the qualities tempered in the Outback of making these things work under difficult conditions come into play. Tasiast is on the western fringe of the Sahara Desert and around 170 kms east of the port of Nouadhibou. The nearest paved road under construction is 60 kms to the east and there is a railway 85 kms to the north. Some investors in London might blanch at the thought of getting a mine into production under such conditions, but Ross Calnan would counter by pointing to the facts that the road is moving towards the mine and there is an aquifer 60 kms away which could supply water.

    He is focused on getting this project into production at a rate of around 130,000 ounces of gold a year and it looks as if cash costs will be around US$175/oz. The deposit will be open cast mined at a grade of 3.1 g./t and not only is the initial ground to be mined soft, but the strip ration should be as low as 3.5 to 1. Once it is up and running the company can look forward to a mine life of at least seven years and can then start exploring its highly prospective properties well to the east of Tasiast and seek new projects. The rest of the directors bring plenty of expertise in mining, mining finance and law so Midas will not be a one-project company.
    ........................thought this would explain where they are at.................gosh
 
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