2008 Annual Report
Address by the Chairman
It is my pleasure to present to you the annual report for the year to 30th June 2008.
Despite the significant down-turn in the share market that has persisted since November 2007, coupled with the impact from the Opus Prime collapse, which involved some of the Company shareholders, though none of the Directors personally, the Company has endeavored to remain focused on developing its base metals resource in north western Botswana.
During this year the availability and supply constraints within the resource industry have made it difficult to maintain projected time frames, which I understand can cause frustrations within the investment community. The pace of exploration activity that prevailed during the year impacted to the same extent in Africa as it did in Australia, resulting in difficulties in contracting drilling rigs and field crews to compliment them. At times, assay laboratory queues extended to ten weeks. Despite this, the Company managed to complete some 5,000m of diamond core drilling, mainly applied to resource development.
The Company is targeting an open cut zinc/lead/silver resource base of some 20 million tonnes at its base metals project in north western Botswana, as a precursor to a pre-feasibility study. We believe that there is a good possibility of achieving this 20 million tonne target from potential combined resources at the Kihabe and Nxuu deposits, which are situated seven kilometers apart. Assay results from the above mentioned drilling are currently being applied to the revised resource models which are expected to be completed in October.
Within this significant Proterozoic belt of some 2,000 square kilometers, which is completely controlled by the Company, a number of other prospective targets have been generated for testing. Further exploration drilling was conducted at the Gossan anomaly, ten kilometers south of the Kihabe deposit and extensions to the mineralised system on the Namibian side of the border were also drill tested. Results from this drilling are pending.
Despite the downturn during the year in zinc and lead prices, the Company believes that this is a temporary situation influenced by the current economic climate which has brought about the recent closures of some high cost underground zinc mining operations. These closures are already critically impacting on the low and sensitive world zinc stock pile levels and any escalation of closures could well put world zinc supply back into deficit, as seen in 2006/2007. The longer term forecasts, through to 2011/2012, show that the demand for zinc in developing nations could well be restricted to supply, which we believe will take prices back to the levels of 2006/2007.
In Namibia, the company continued with diamond exploration at its Tsumkwe project. One potential kimberlite target was drilled. This target requires deeper drilling to determine whether the hole drilled to date intersected a conglomerate or a kimberlite breccia.
During the year, the Company was granted additional ground for diamond exploration in the Hardaap area of Namibia. This ground covers the Maltahohe kimberlite field, believed to be the source area for the diamonds recovered around Meob bay on the western coastline of Namibia.
At the Company’s Telfer project in Western Australia, the Company delineated a resource estimate at the Camp Dome deposit, which is currently under application. An inferred resource was estimated at 6 million tonnes @ 0.47% copper, with an in ground metal content of 28,200 tonnes of copper. It is believed that this resource could be extended significantly with further drilling. This porphyry style deposit also contains significant values of tungsten, though further drilling and assaying for tungsten will be required to estimate a tungsten resource.
I would like to extend my thanks to the support of our shareholders who have continued to help in our fund raisings and to our Directors and staff members for their commitment to the Company’s objectives. Operations within different international time zones require the application of irregular and longer than normal working hours. For this I am grateful.
Nigel Forrester
Chairman & Managing Director
