Companies: AMBR    CMR    IFL    PLX   

Ambrian Capital’s agreement to merge its unlisted mining and exploration assets with Kyrgystan-focused Palladex brought a fillip to Palladex’s bombed-out shares, now 4.5p, but sent Ambrian marginally lower to 55.75p.

Elsewhere, Chinese stainless steel combine JISCO is the biggest single shareholder in ferrochrome supplier International Ferro Metals (IFM). It produces this essential stainless steel ingredient at Lesedi in South Africa’s Bushveld and is speeding up expansion by launching a new smelter in January, three months ahead of schedule. Australia-based IFM, which raised £99 million at 35p with its AIM float last year and has agreed £79 million of project finance, has doubled initial productive capacity to 300 million lbs a year by acquiring 80 per cent of the Skychrome deposit, near Lesedi.

Managing director Stephen Turner suggests IFM, which has an offtake deal with JISCO for nearly half its output, will be able to produce ferrochrome at a cost of 38 US cents- a-lb, roughly half its current market price. The weakness of the South African rand is an important element in the calculations of the company – it lost more than £5.5 million in its last full year.

At 40.5p, valuing the company at £166 million, IFM shares could repay a long-term punt.

Vanadium ponders AIM float
Precious Metals Australia (PMA) says an AIM float could, if new issue sentiment recovers, feature in preparations for its £70 million Windimurra vanadium project Down Under. Loss-making, but with £20 million cash, PMA trades at the equivalent of £1 on the Australian Stock Exchange and insists vanadium, a recently-discovered element that hardens steel, helps make sulphuric acid and reduces cholesterol, is poised to come into its own.

Managing director Roderick Smith is negotiating a £48 million debt-funding, part of a £74 million package to start production from Windimurra’s industry standard reserve of 50.4 million tonnes and claimed potential resource of 148 million tonnes. Noble, a £1 billion Singapore-listed metals trading group, has agreed to take all Windimurra’s output on a cost-plus basis, plus stakes of ten per cent in PMA and the project itself. Definitely worth a flutter.

New era for Cambridge
Colin Andrew, managing director of battle-scarred Cambridge Mineral Resources, is determinedly seeking to carve out a new path for the AIM-quoted concern, whose long and ultimately fruitless attempts under a previous regime to develop a large polymetallic deposit in Spain, cost the company dear in cash and shareholder support.

Cambridge is poised to appoint a new chairman in the shape of Ambrian’s Neil McLachlan and has identified encouraging gold and silver prospects in Colombia and Peru. It is thought to be considering a £1 million fundraising to take them further.

Andrew, who took the helm last year, has set the company seeking a collection of small to medium-sized projects make it a sizeable producer. Cambridge has so far defined a measured resource of 10,921 tonnes at a grade of 9.63 grammes of gold and 20 grammes of silver per tonne of ore at Quintana in Colombia. Andrews, an experienced mining hand, reckons this forms part of an overall 28,950 tonnes, grading 9.49 grammes-a-tonne gold and 20 grammes silver.

Cambridge, for which Andrews has set a target of achieving gold production of 100,000 oz a year, is looking at several interesting veins at Quintana similar to the one now being mined and has identified further encouraging grades. The company is investigating prospects in Peru and has received cheering drilling results from the Tashlaka Hill gold deposit in Bulgaria, where Cambridge is a minority partner with Asia Gold.

Floated nine years ago at 16p, Cambridge has been a dire AIM performer, trading now at 4p. If its new plans bear fruit, it could offer interesting recovery potential.