Companies: GOIL    MTL   

AIM-quoted Granby Oil and Gas, for example, has increased reserves 130 per cent and expects its first North Sea gas to flow early next year. London-based Granby, with interests in the Philippines, says its booked reserves have risen from 1.9 million to 4.4 million barrels of oil equivalent. The company says it has completed the first phase of development at its gas field in the southern North Sea and managing director David Grassick is ‘looking forward to our first production in early 2008’.

Floated two years ago at 84p, Granby shares soon raced to 137.5p before beginning their descent to 48p. Since August, they have rallied to 70p, valuing the company at £25.5 million and might make further progress if the company’s results continue to enthuse.

Philippine fanciers forge ahead
Mineral opportunities in the Philippines continue to attract smaller companies. AIM-quoted Metals Exploration suggests further drilling could justify moving a third of its estimated two million-oz ‘inferred’ gold resource at Runruno to the firmer ‘indicated’ category. Such a move could lift the estimated total to 2.5 million oz.

Steered by chief executive officer Jonathan Beardsworth, the company is investigating four more targets, in search of gold, copper and molybdenum. Metals Ex talks of possible operating costs of $280 (£136.70) an ounce, against today’s $757 market price.

Elsewhere, the company is waiting for an exploration permit from the Indonesian Government for its Waigeo Island laterite nickel deposit. Fans claim this could yield a million tonnes a year for 15 years, despite possible environmental objections, and generate annual operating profits of between £10 million and £20 million, which all adds speculative spice to the shares at 40p.

Another AIM counter, Medusa Mining, recently raised estimated indicated and inferred gold resources 266 per cent to 713,000 oz at its Co-O mine in the Philippines, at a respectable grade of 10.98 grammes of gold per tonne of ore. Managing director Geoffrey Davis sounds confident the Western Australia-based company can establish a target resource of one million oz at a similar grade over the coming months, which, if achieved, ought to put the shares, at 59p, on the map.

Breakfast from Tiffany
Gem and gold hopeful Target Resources is raising funds for potentially high-margin diamond production in Sierra Leone. Some £5.6 million is coming through a share placing and subscription at 21p, less than half the 50p at which the company was floated on AIM last year and New York Stock Exchange-quoted jeweller Tiffany & Co is providing another £2.45 million through a five-year unsecured loan.

Target’s managing director Dr. Nissim Levy, no stranger to controversy in other guises, is particularly pleased Tiffany has signed a ten-year exclusive marketing agreement for the stones from the company’s 4,200-acre alluvial diamond prospect in Sierra Leone’s gem-rich Kono region. The money now raised will buy mining equipment and infrastructure items to start production there.

Levy, who suggests the company will reach full production in ten months, says Tiffany likes the project because Kono stones tend to be large and valuable, ‘above three carats’ each. He cites consultants’ reports projecting monthly production worth $9 million, against a break-even figure of $1 million or lower.