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Great Western Minerals (GWG.V) - plumbs new depths for rare earth elements
Comment by Objective Capital , May 22, 2008
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Great Western Minerals has started an aggressive drill programme on its Deep Sands rare earth element project in Utah, United States. The company expects to complete 66 holes to a minimum depth of 30 metres, at a 1,600-metre spacing.
These tests will allow Great Western to assess the iron and rare earth element content across the 17,094-hectare property. The company will also drill 1,000 shallow holes to a depth of approximately six metres to investigate the near-surface distribution of iron and rare earth elements.
Great Western is spending C$400,000 for this programme and it tentatively expects results in September. The company acquired a 25-percent interest in the project in 2007 for US$4.3m.
Objective's view:
Great Western Minerals remains focused on the Hoidas Lake rare earth element project in northern Saskatchewan, but the Deep Sands property offers further exposure to rare earth elements, which continue to command robust prices.
Preliminary work last year showed that the mineral sands persist to a depth of at least eighty metres and preliminary sampling suggests a total rare earth oxide content of 0.14 percent. The objective of the current drilling programmes is the development of an NI 43-101-compliant mineral resource estimate, to be followed by commencement of a prefeasibility study.
Our valuation ascribed little value to the Deep Sands property, based on its early stage and lower priority. Pending any compliant resource estimate we view this news as supportive of our core valuation of C$0.35 per share.
