ALK:ASX; ANLKY:OTCQX

Alkane Resources Ltd.

Alkane Resources Ltd. is a multicommodity mining and exploration company with a focus on gold, copper, zirconium, niobium and rare earths. Its projects and operations are located in the central west of New South Wales, in eastern Australia. Alkane commenced gold production in early 2014, after commissioning its Tomingley gold project in February, on time and on budget. The company is also developing the Dubbo zirconia project, with operations scheduled for 2016. This will position Alkane as a strategic and significant world producer of zirconium products and heavy rare earths. Several other copper-gold exploration projects in the region are being evaluated. The company is heavily committed to safe environmental practices and local community wellbeing.
ALK:ASX ANLKY:OTCQX

Expert Comments:

Mike Millikan, Hartleys (4/21/16)
"Gold production from Alkane Resources Ltd.'s Tomingley gold operation. . .is still tracking within FY/16 company guidance of 60 Koz. . .we maintain our Speculative Buy recommendation on the company's stock. Alkane's wholly owned subsidiary Australian Zirconia Ltd. (AZL) was granted the environmental protection license for the Dubbo Zirconia project (DZP) on March 14. This license is the final approval required to enable AZL to progress with construction, but development remains subject to financing. . .AZL is targeting first production in 2018."

Tom Hayes, Edison Investment Research (4/14/16)
"Alkane Resources Ltd., via its wholly owned subsidiary Australia Zirconia, has signed a letter of intent with a private Vietnamese specialty metals refiner and trader relating to the toll treatment of the Dubbo zirconia project's (DZP) rare earth output. The agreement, although early stage, removes a degree of uncertainty over the future sale of a significant portion of the DZP's annual production; we also see the agreement as derisking project financing."

Tom Hayes, Edison Investment Research (3/15/16)
"Alkane Resources Ltd.'s wholly owned subsidiary, Australian Zirconia, has been granted an environmental protection license. This finalizes the approval process for the Dubbo Zirconia project (DZP) and significantly de-risks the path toward financing. With all the development permits now in place, the company can provide assurance to its finance team that no fundamental obstacle, whether technical, commodity price (the DZP is robustly profitable at current commodity prices), governmental or otherwise, can hinder the project's development post financing being secured. . .Alkane can finalize key off-take agreements and progress financing of the project."

Mike Millikan, Hartleys (2/1/16)
"Gold production from Alkane Resources Ltd.'s Tomingley gold operations (TGO) was down quarter-over-quarter but in-line with company forecasts. . .gold production continues to underpin the current trading range, with generated cash funding some of the pre-construction activities at the company's flagship Dubbo zirconia project (DZP). . .the DZP is considered a world-class asset of strategic value, containing a large polymetallic resource of zirconium, hafnium, niobium and rare earths, which can support a long mine life (30-plus years). The project financials appear robust and highlight potential for significant cash flows (AU$300M-plus annual earnings before interest, tax, depreciation and amortization deductions)."

Tom Hayes, Edison Investment Research (2/1/16)
"Alkane Resources Ltd. reports a second cash flow-positive quarter in Q2/16. . .gold production remains on track for 60–70 Koz by FY16E. . .progress on developing the Dubbo zirconia project is also highlighted, with the key mining lease achieved during the quarter."

"It has been a long-term objective of Alkane Resources Ltd. to mine underground at the Tomingley gold project (aka the TGO) and the announcement of a JORC-compliant reserve, undertaken as part of its TGO prefeasibility study, is a major step toward realizing that objective. In fact, when the TGO first started production, Alkane extracted more gold than it had originally estimated within the resource block model for one of its deposits. Further, due to JORC reporting guidelines, all Inferred material included in the pit designs needed to be set to a zero gold grade, but upon mining all Inferred ounces were 100% converted into production ounces. So as you can see, the amount of gold extracted at surface exceeded expectations, and to me this highlights the strength of the mineralized system at the TGO. So, yes, the TGO's gold endowment certainly does support an underground operation. It would not be a surprise to me if the amount of gold extracted underground at the TGO exceeded expectations again." read more >

More Expert Comments

Experts Following This Company

Charles Gibson, Director, Mining – Edison Investment Research
Tom Hayes, Analyst – Edison Investment Research
Richard Karn, Founder/Editor – Emerging Trends Report
Mike Millikan, Resources Analyst – Hartleys

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Investing Highlights
 
Multi-commodity miner: gold, zirconium, niobium and rare earths
 
Successful mining track record
 
Next heavy rare earth project