Brinkley frustrated with SA govt

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Gerard Holden, joint executive chairman of Lonrho Africa Plc, also chairs Brinkley Mining

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Brinkley frustrated with SA govt
Allan Seccombe
Posted: Thu, 29 Jun 2006

[miningmx.com] -- South Africa�s minerals department (DME) should be wary of driving off investment through being too slow to process prospecting rights, said Gerard Holden, the chairman of uranium exploration company Brinkley Mining.

In an interview with Miningmx, Holden said there was a level of frustration creeping in with the pace of being granted the new order rights for the five farms covering 42,000 hectares in the Karoo that the company plans to explore.

�We are working hard with our empowerment partners to move that process as fast as possible. As soon as we�ve been granted those licences we�ll spend money on the ground,� he said.

�A message to the DME and government is to say there is foreign investment and foreign capital wanting to come into the country, don�t look a gift horse in the mouth. It is a little bit frustrating and the country has to be aware it�s competing with others for capital,� he said.

It is a little bit frustrating

According to statistics from the DME carried in Miningmx�s Mining Yearbook 2006, 13% of 8,293 mining and prospecting licence applications and conversion of old order rights to new order ones have been granted.

In the previous year to June, only 2.5% of 4,424 applications had been granted.

�We are getting the hang of it,� DME director general Sandile Nogxina told the Mining Yearbook.

AIM-listed Brinkley owns one of the farms and has the option to buy the other four. There have been workings on one of the farms before, so there is a high level of certainty about the presence of uranium and molybdenum, which is used in stainless steel production.

Brinkley is also looking for projects in the Democratic Republic of the Congo, Namibia and Tanzania.

�We owe it to our shareholders to be adventurous, bold and brave in terms of where we look to find uranium projects we can transform into operating projects as fast as possible,� he said.

�We don�t want Brinkley to be seen as a single-asset company,� he said. �It�s critical for us to be in the mix when people talk about other assets, which means there�s a lot of things to look at. It will take time and we need to be careful with how we spend $35m of shareholders� money.�

Africa will be the specific focus for Brinkley, rather than the other uranium hot spots of Canada, Kazakhstan and Australia.

�I can add the most value in an African context,� he said, explaining he had spent 20 years in the Barclays group, eight of which as head of global mining and metals, spending a lot of time financing mining projects in Africa.

�It�s a place I know very well. I understand a few of the nuances. I have a pretty good feel for the issues and I have a lot of contacts on the continent,� he said.

Brinkley is keen to make a positive social difference where it operates mines because it will minimise risk to the business.

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An airborne survey of the farms will begin shortly to conduct a radiometric study of the farm to combine with a desktop geological modelling of the area to give drill targets by the start of October.

Most of the sandstone that contains the uranium is 20 metres to 40 metres below surface. It is estimated that the deposits hold between 41m and 83m pounds of uranium and 23m to 47m pounds of molybdenum.

�We want to have an early stage resource in the first half of next year so we can decide how the economics look and what to do next to move towards pre-feasibility and feasibility studies,� he said.

Brinkley was focussing on uranium because it will be the energy source of the future, Holden said.

Australian outfit Resource Capital Research (RCR) forecast the price of spot uranium would rise to $54 per pound this year from $45 currently, which is a 27% increase in the year to date. The price will reach $60 by May 2007, it reckoned.

Worldwide, there are proposals and plans for 180 new reactors to add to the existing 441, a Reuters� story said, citing the RCR.

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