Broker places $0.10 price target on Peninsula Minerals
The broker concluded its review: "Low capital and operating cost uranium developer with significant catalysts. Maiden resource from USA on track for mid 2010 with first production Q1 2012".
"Peninsula Minerals (ASX: PEN) has reported additional drill results from its 100% owned Lance Uranium Project, located in Wyoming. The company has now drilled ~180 holes at its two main areas of focus, Ross and Barber. The most recent drilling results are from the Barber project site. PEN has reported grades of up to 1,140ppm U3O8 over 12ft of thickness."
"Peninsula remains on track, or ahead of schedule, to accomplish its targeted inferred resource of 15mlb uranium by 30 June 2010 and first production by mid 2012."
Mapping Roll Fronts – What it Means
"Peninsula is yet to specifically target the nose of any roll fronts; however, every hole that has been drilled to date has encountered mineralisation."
"This is particularly significant as the Company should begin targeted drilling on the nose of the roll fronts over the next two months, with possible results by the end of March 2010. We expect that these results will yield consistently higher grades than the already impressive results achieved to date."
"The roll fronts are in the redox (reduction / oxidisation) zones where the greatest deposition of uranium can occur. In order to most efficiently define a resource, these roll fronts must be mapped. The best way to do this is to drill either side of the redox zone, with one well in the oxidised zone and one in the reduction zone. There is no guarantee that mineralisation will exist in every redox zone encountered; however, PEN has achieved an almost 100% strike rate."
This type of drilling often results in seemingly inconsistent results; however, is sufficient to define an inferred resource.
Once the roll fronts have been mapped, more focussed drilling, targeting high-grade mineralisation can occur, which will result in an indicated resource (higher degree of confidence than inferred). The indicated resource can then be used as the basis for a Bankable Feasibility Study (“BFS”)."
Boxes Ticked -High Grade Results, Initial Resource Expected Next
"Peninsula has also achieved other significant milestones recently, such as commencement of pre-feasibility and plant design at Lance, 24 aquifer monitoring wells completed and significant progress on permitting."
"All of these milestones provide confidence that the Company can meet or exceed expectations related to timing of production and size of potential resource. We are also expecting significant catalysts over the next 5 months, with high grade results likely from targeted drilling of mapped roll fronts and the achievement of the initial JORC resource by mid 2010."
Hartleys was an underwriter to the company.
