Not many left under $50m really……
A Cheap Uranium Explorer?
FN Arena News – May 03 2007
By Greg Peel
There are an awful lot of junior uranium explorers listed on the Australian stock market, the share prices of which have flown to the moon based on perhaps a just few clicks of the Geiger counter. Paradigm Gold (PDM) is not one of them.
At a mere $11m in capitalisation, and an 18c share price, Paradigm has missed out on the great uranium rush. Maybe it’s because everyone thinks it must be a gold miner. But as respected Australian uranium analyst Warwick Grigor points out, Paradigm gave up on gold exploration late last year.
Far East Capital’s Grigor notes Paradigm has adequate working capital at $2.2m after an issue recently. It should be noted at this point that Far East Capital underwrote that issue.
Grigor suggests Paradigm offers a low cost entry into legitimate uranium exploration in Queensland, where the company is assessing an area near Cloncurry that showed “highly anomalous” uranium sampling when tests were conducted by Energy Resources of Australia (ERA) way back in 1970. Cutting through all the geological mumbo jumbo, it seems the potential resource is “limestone hosted”, which is unusual in Australia.
It’s not unusual in Kyrgyzstan, where about 3,500t of high grade U3O8 was recovered from the Malisu mines. Monaro Mining (MRO) has noted a similar geology in one of its licences in Kyrgyzstan, while Deep Yellow (DYL) does have some targets in Queensland but they are somewhat…ahem…deep.
Says Grigor “Whether PDM actually has an economic deposit will depend on further work – but this is the case with dozens of explorers.”
Paradigm also has another potential site in Queensland – Blue Bush – which is “an interesting oxide-copper-gold-uranium project” which had been previously drilled by the old Conzinc Rio Tinto, which some of you will remember as CRA, back in 1983, and which shows similar geology to the old Mary Kathleen.
But the other interesting string to Paradigm’s bow is its project at White Rock, 120km south of Orange in NSW. Here Paradigm is sitting on an indicated and referred resource of 150,000t at 0.9% WO3 (which is tungsten oxide to you and I). Grigor notes that the value of the tungsten is roughly equivalent to the combined value of the five times larger Wolfram Camp tungsten and molybdenum project being developed by Queensland Ores.
Paradigm sees potential to lift the White Rock resource to 500,000t or even 1mt which would give it the critical mass to develop a mine. If the project can go to production, Grigor suggests this alone would justify a multiple of the current Paradigm share price.
Be warned – this is a highly speculative stock that has absolutely no guarantee of ever mining anything. Investors must be prepared to enter with this knowledge in mind. There is always a chance, however, that the stock could be re-rated by the market before any production possibilities are contemplated.
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