Palladium prices have soared recently from below $300 an ounce to $415, on indications that Russian producers will hold back supplies until the market firms. That, coupled with strong US car sales last month, has brought cheer to some platinum group metals producers, such as Lonmin, up 31.5p at 1004.5p since our mention last week. The implications might be better for South Africa's Impala, at 3100.5p, since a collapsing rand must be swelling its coffers. Aquarius at 301.5p and Cluff Mining at 220p could be beneficiaries, if the palladium surge holds and spreads to platinum.

Murchison wants £100m

Copper and tin group Murchison United is looking to raise some £100 million in the near future, mostly in debt with a smaller equity component. Its shares have been suspended on Aim at 31p following Rio Tinto's acquisition of 49 per cent of Somincor, the holding company for its Neves Corvo joint venture in Portugal, but they can still be traded Down Under.

Advisers to Murchison, which has fallen from a 12-month high of 67p, say it has set in train significant cost cutting measures in Portugal and that its copper deposits are showing some encouragingly high grades. Bulls argue tin and copper are showing signs of bounce from previous lows, claiming that base metals lead precious in the cycle.

For a pure metal play, fully listed Antofagasta, firm at 545p, looks a safer bet. But at these levels Murchison should be worth holding as a recovery speculation – as long as further encouraging news from Portugal accompanies the impending fundraising.

Angus scoops in £400,000

Bob Young's tantalum venture Angus & Ross raised £77,000 yesterday from institutions at 22p a share, a 3p discount to its Aim price. This brings the amount the company has raised from City funds to £400,000, since it moved up from Ofex to Aim in August.

Close observers believe the company should soon be in a position to reveal some encouraging drilling results from Greenland, where it is investigating tantalum deposits. Sympathetic sources suggest the company could have found mineralisation in virtually every hole, though confirmation of that awaits the drilling report.

The shares have soared since we first highlighted them on Ofex, where their 12-month low was 1.75p. As we have said before, take some profits, but keep in some for the chance of further gains.

Impala backs Ofex hopeful

Mighty platinum producer Impala is helping fund platinum prospecting in Minnesota by Franconia Minerals, which is coming to the J P Jenkins market for £332,000 at 2.33p a share, to value the company at £1.3 million. Based in Calgary, Canada, Franconia, which is exploring copper-nickel and zinc prospects as well as platinum group metals, has interests in 14 sites in Minnesota's mineral-rich Duluth complex and Impala has agreed to pay up to £430,000 to fund platinum prospecting.

According to Franconia's adviser Lion Capital, Impala stands ready to put up many times that if the projects look promising enough. Franconia is operating in alliance with Teck Cominco, one of the world's leading zinc producers, which will hold 7 per cent of the company after the float.

Franconia's president Brian Gavin and chairman Ernest Lehmann are understood to have accepted co-operation terms from Impala in preference to an offer from Anglo-Australian giant BHP Billiton. Aussie investor Bruce Rowan is supporting the Franconia issue in a big way.

He is taking 34 per cent of the issue (8 per cent of the company) through Web Shareshop and is being granted twice that amount of shares (16 per cent). He also receives warrants equivalent to another 16 per cent at 2.33p exercisable for four years – for a theoretical 40 per cent – while his colleague Otto Snel is receiving 250,000 shares for broking the deal.

For gamblers.

Sour reception for ZincOx

Shares in ZincOx, ex-Reunion Mining boss Andrew Woollett's comeback vehicle, fell 17 per cent to 99.5p on their first day of trading on Aim, after successfully raising £3 million in a placing at 120p. Woollett claims the company's new zinc oxide process can cut production costs to 22 cents a pound, more than 10 cents below even current depressed prices, and dismisses fears over political risks for its Jabali mine in Yemen by pointing out how pro-western the Yemeni regime is (for now).

Last week, we said ZincOx, floated by broker Charles Stanley, was a a gamble but one which was worth taking. That remains our view in the medium to long term, especially since one of the company's joint venture partners is Anglo-American, though short-term investors might prefer to avoid this one.

Diamond profits in the City

Broker Williams de Broe, which last year handled the successful Aim float of European Diamonds, is exercising a package of 350,000 warrants to buy some new shares at 84p each. With European's shares trading at 188.5p, 11.5p off its high and 45 per cent up from its 12-month low, that gives the broker an immediate paper profit of £371,000.

Williams de Broe may prefer to hang on to its shares, though most of the team involved in the European float have since then moved to Beeson Gregory. It is hoped there could be some cheering news about its Finnish gem deposits before too long.

Another feather in the same broking team's cap is Aussie-listed Dwyka Diamonds, which came on to Aim the other day after a £3.5 million placing at 40p and has now moved briskly up to 49p. With interesting prospects in South Africa's Kimberley region, this one could have further to go.

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