Companies: ZOX   

The Yemen Parliament has given the go-ahead for ZincOx Resources to develop the 870,000-tonne Jabali zinc deposit.

AIM-quoted ZincOx has a 52 per cent stake in a joint venture set up to exploit Jabali. This deposit is estimated to contain a ‘measured and indicated’ resource of 10.8 million tonnes of ore at 8.7 per cent zinc, 1.2 per cent lead and 68 grammes per tonne of silver, plus an ‘inferred’ resource of another 1.8 million tonnes at 9.4 per cent zinc, 1.2 per cent lead and 71 grammes a tonne of silver.

The Yemen Parliament has approved an exploitation contract for Jabali between the Ministry of Oil and Minerals and the joint venture company, Jabel Salab, in which the 48 per cent minority is held by a concern ‘controlled by prominent Yemeni businessmen’. ZincOx, chaired by the indefatigable Andrew Woollett, says this is the first large-scale mining licence ever awarded by the Yemen Parliament. It expects to produce 70,000 tonnes a year of high-quality zinc oxide from Jabali.

The estimated project cost is £88 million. ZincOx says London investment banking boutique Exotix is in ‘advanced-stage’ discussions on a banking facility for this.

Recommended by Growth Company Investor in 2005 at 129.5p and highlighted last February at 284p, ZincOx shares are 98.5p up today at 374p, valuing the company at £183 million. Partial profit taking might be tempting, but they could well have further to go.

ZincOx	AIM	£24.44m	31.50p	1.00p
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