Companies: IOF   

US iodine and gas concern Iofina expects first cash flow from its two projects in Montana later this year.

Iofina, which joined AIM in May with a £15 million placing at 55p, lost £317,500 in the first half of this year, but starts drilling this month and says it anticipates its first iodine and gas revenues by the end of the year. The company, steered by chief executive officer Dr David Schneider, owns 100 per cent of the 60,000-acre Atlantis project and says it is discussing a possible joint venture with gas operators at its recently acquired 30,000-acre Triton prospect.

Schneider says Iofina, which in April recruited ex-Shell UK boss Dr Chris Fay as deputy chairman, still has £14.2 million cash, ‘enough to cover the planned drill programme’. According to the company, a ‘competent person’s report’ (in the industry parlance) on an initial 28,000 acres of Atlantis shows an estimated resource on that portion alone of 155 billion cubic feet of gas and 100 million kg of iodine.

Looking forward, Schneider says he expects the company to drill 1,100 wells over five years and generate production of 1,400 tonnes of iodine. ‘We’d then be No 1 in the USA’, he suggests, adding that increased uses for the material are likely to cause a long-term shortage.

As yet, however, AIM punters are unexcited. The shares, which hit 93.5p in June, now trade at 50p, valuing the company at £47 million, which could prove a grudging rating if Schneider’s hopes are fulfilled.

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Iofina	AIM	£27.68m	29.50p	-0.50p
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