Small Talk: Strategic Minerals puts tax concerns aside in Queensland

It has now been a week since the announcement by the Australian government of sweeping plans to curb carbon emissions, with Canberra unveiling a levy on the country's biggest polluters. The continent boasts a vast mining industry, and the news has been met with disappointment among industry groups. Some big- name miners also weighed in, agreeing with the principle of tackling climate change, but not so receptive to the idea of the planned tax on their operations.

But what about the smallerplayers? There are numerous mid- and small-cap miners acrossAustralia – one of them is Strategic Minerals, which made its market debut in London last month.

The company is focused on iron ore in north-eastern Australia and, through its wholly owned subsidiary Iron Glen, owns an exploration permit for minerals covering some 2,100 hectares just south-west of Townsville in resource-rich Queensland. Well, as it turns out, chief executive Patrick Griffiths is not too pleased with the news from Canberra either.

"It's a hotchpotch of a policy," he says, complaining that while he does not disagree with the aim of tackling emissions, the best way to go about it is via collective action around the world. But if the proposal does become law, Mr Griffiths warns it will "add to the cost of Australian exports", and "certainly have a negative impact".

For now, though, his focus is on Strategic and its Iron Glen exploration programme. The company has been busy since listing, with four updates to the market, including one at the end of last week.

The latest release was encouraging, with Strategic saying that its Iron Glen drilling plans are advancing well. Altogether, 10 holes have been completed and another two are nearing completion. The area is known to hold magnetite, which is in increasing demand as an iron ore source – it makes up around 24 per cent of Australia's economic demonstrated reserves of iron ore – and comes in handy in steelmaking. And in addition to showing this resource, recent results, although preliminary, have also pointed to deposits of copper, zinc, silver and gold.

"While these results can only be considered preliminary, they are consistent with our expectations for the area covered by the work completed to date," Mr Griffiths said when he announced the latest results on Friday. "The consistency of the silver value is encouraging, as is the presence of gold. The commercial value of both can only be properly assessed when our geologists have analysed the full assay results, combined with a subsequent assessment of the mineability of the deposit and associated factors."



Ferrex to test mettle on Aim

From iron ore in Australia to iron ore in Africa. This morning will see the commencement of dealings in Ferrex, a miner focused on developing iron ore and manganese deposits in South Africa and Mozambique.

The company has raised £2m before expenses by placing shares at 3p apiece, thus commanding a market value of around £15.5m on admission to London's junior market. The money will go towards expanding and advancing itsportfolio, which includes theMalelane iron and the Leinstermanganese projects in South Africa, as well as a joint venture covering an early stage manganese project at Changara in Mozambique's Tete province.

Ferrex is led by chief executive Dave Reeves and chairman Brian Moritz, who is well known in London's mining circle. A chartered accountant by training, he was once senior partner at Grant Thornton UK, where he formed the accountancy firm's capital markets team, helping to bring more than 100 companies to the Alternative Investment Market during his time there. Mr Reeves specialises in miners, and in the past was the chairman at African Platinum and Metal Bulletin.

The veteran, who has spent more than a decade developing African projects, says that, alongside a sound management team, Ferrex offers a "compelling valuation relative to its peers", adding that he thinks all of the company's projects are well placed to make advances.

"Our near-term resource and mid-term production horizon ideally places Ferrex to capitalise on the increasing world demand for steel, which is the primary market for iron ore and manganese," Mr Reeves says. "The market for steel-feed commodities is growing rapidly, primarily driven by demand in China, and the economic outlook for a company producing such commodities is set to be favourable."

Enegi runs the rule over ABT

Enegi Oil has now been around on the Alternative Investment Market since 2008. The oil prospector, which has interests in Ireland and Newfoundland, Canada, recently raised money via an equity placing, with the funds earmarked for exploration activities, working capital and to pay for due diligence on Advanced Buoy Technology or ABT, which Enegi has an option to acquire.

ABT is a private firm, fully owned by Enegi's chief executive, Alan Minty. So far, however, Enegi has not put any money towards the business. In an update in May, it said it had secured the "exclusive, four-month option, at nominal cost", and wanted to study the business before deciding whether or not to put the deal to shareholders, who will get the chance to vote on the matter.

The company, which recently secured a strategic partnership with the oil services heavyweight Wood Group, is a specialist in new, unmanned buoy technology that allows for the development of marginal oil and gas fields. The idea is attractive. It doesn't make sense to build costly offshore platforms with production systems when it comes to marginal or end-of-life fields; the expense plays havoc with the economics of sucking out a few thousand barrels.

ABT offers a way out with a buoy structure that has an access tower. The unmanned buoy sits just below the surface and houses the production and processing equipment. Crucially, it costs a lot less than big platforms or pricey vessels, making it worthwhile for companies to exploit marginal fields. There are a lot of marginal fields where this technology could be applied. In the UK continental shelf alone, there are numerous avenues for new developments, with many of them too small to merit a huge capital outlay.

Suggested Topics
Sport
The sun rises over St Andrews golf course, but will it be a new dawn for the Royal and Ancient Golf Club?
sportAnd it's Yes to women (at the R&A)
Arts and Entertainment
Friends is celebrating its 20th anniversary this year
tvSeries celebrates 20th anniversary
Sport
Yaya Touré (left) and Bayern Munich’s Spanish defender Juan Bernat
footballToure's lack of defensive work is big problem for City
Voices
voicesApple continually kill off smaller app developers, and that's no good for anyone
PROMOTED VIDEO
Arts and Entertainment
Liam Neeson said he wouldn't
tv

Liam Neeson's Downton dreams

Sport
Wembley Stadium
footballNews follows deal with Germany
Arts and Entertainment
A spell in the sun: Emma Stone and Colin Firth star in ‘Magic in the Moonlight’
filmReview: Magic In The Moonlight
News
ebooksAn unforgettable anthology of contemporary reportage
Sport
A 'Sir Alex Feguson' tattoo
football

Arts and Entertainment
Ben Whishaw is replacing Colin Firth as the voice of Paddington Bear
tv

Thriller is set in the secret world of British espionage

Life and Style
life

News
ScienceGallery: Otherwise known as 'the best damn photos of space you'll see till 2015'
Life and Style
fashion

Bomber jacket worn by Mary Berry sells out within an hour

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Audit Manager Central Functions

To £85,000 + banking benefits: Saxton Leigh: You will be expected to carry out...

Credit Risk Audit Manager

Up to £90,000 + benefits: Saxton Leigh: Credit Risk Audit Manager required to ...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week