african minerals appears to be upping its stake - possible takeover / offer?

Yesterday's from Proactiveinvestors >>>>>>>>>>>>

Baobab Resources sees all routes pointing forward in Mozambique
Mon 1:46 pm by Jamie Ashcroft

For some investors the jury is out on Mozambique’s promising Tete mining hub in light of Rio Tinto’s $3bn coal write-off there.

The write-off sent shockwaves across the African mining sector at a time when there are serious questions about the industry’s appetite for major growth projects.

According to Baobab (LON:BAO) chief Ben James, though, there have since been positive signs in Mozambique that the situation is improving.

Since Rio’s action - at the end of January - the region has seen significant developments.

Brazilian mining major Vale this month confirmed that a new railway link capable of carrying 30mln tonnes each year would go ahead.

Around 12mln tonnes of that capacity would potentially be available for third parties including companies like Baobab.

“The Rio write down was something of a reality check for the government,” James said.

“There is a possible fairytale opportunity here for Mozambique, but it will only come off with a lot of elbow grease and with everybody working shoulder to shoulder.

“So we now seeing the government, rather than taking a backseat, actually taking a much more proactive approach. And that’s wonderful news for companies like ours.

“The government is much more ready to pick up the phone, reach agreements and broker meetings.

“And that is also true of the majors, both Vale and Rio, too. They are being very co-operative with the juniors. We are showing that we can all work together to develop and define infrastructure solutions.”

Baobab is in the midst of the important feasibility and mine planning stage. After finding over 700mln tonnes of iron ore in the Tete province it now has to confirm if and how a mine can be built.

Crucially it must also secure a viable export route to take its end product to market.

James explains that a number of options are open to the company and it is continuing talks to secure allocation on one or both of the two key railway lines currently in development.

He says the company won’t be putting all its eggs in one basket and it is pursuing these opportunities through both the public and private sector.

“We’ve been talking with Vale for a long time and that route really looks like it is going to go ahead now.”

In fact, he says he'll soon be visiting the new rail spur construction in Malawi – where 2,000 men are building the railway through to Tete.

“The project is definitely happening. And there will be plenty of third party allocation on that railway line once it is commissioned.”

“What we are also seeing now is a very clear commitment from the international community, particularly the Japanese, for co-funding the east-west rail corridor.

“All of these things are in play."

Meanwhile, James also points to positive signs that the expansion and refurbishment of the Sena rail line is well underway.

Fellow AIM-firm Beacon Hill recently secured an allocation on this line, which connects the Tete province to the Port of Beira, at the mouth of the Pungue river on Mozambique's coast.

"We would expect to see the railway handling up to 6mln tonnes per annum very soon, and it will continue expanding from there on.”

“For us, the route through to the Port of Beira would present an ideal solution for our exports because of both the distance to the coast and the fact that we won't be constrained there unlike the coal miners.

“We would require Handymax sized vessels, which are operating very efficiently at the port at the moment. So while Beira is not an ideal port for the coal players, it is ideal for Baobab.”

James explains that Baobab has always had strong support from the Mozambique government and this is, in part, because the company plans will see additional industry being developed in the region.

Through intermediate smelting at the ‘mine gate’ it plans to add value to the ore it mines, processing it into pig iron.

“The government has been keen to endorse and support these plans.”

This pig iron operation can become one of the largest of its kind in the world, with the potential to produce up to 4mln tonnes of ‘pig’ iron each year over a 35 year life.

Currently the largest producer is a Russian operation that yields around 2.5mln tonnes a year.

The process requires significant volumes of coal, which in itself presents an opportunity given the region’s vast coal fields and its currently limited scope for exports.

Both Vale and Rio are keen to talk to Baobab about the coal requirements, according to James.

“Their thermal coal can’t be commercially exported at present. It is simply not viable for them. So it is just building up in stockpiles at the moment.

“We will need coal. We can take some of it off their hands. So we’re in the process of opening discussions about possible off-take arrangements and we are confident of getting very competitive mine gate rates for that coal.”

The development plans are now coming together with the fully funded prefeasibility study drawing to a close.

Last week, Baobab revealed the latest in a series of resource upgrades that have seen the Tete project’s resource base grow massively from to over 700mln tonnes from 160mln tonnes in the summer of 2011.

It has also made a bold step in kicking off a drilling programme and work on other ‘time critical’ elements for the definitive feasibility study.

This decision was made as the mine developer became sufficiently confident in the outcome of the ongoing pre-feasibility work.

From a financing point of view Baobab is in a strong position as it moves the project forward, James says.

The prefeasibility is fully funded and so is the ‘front end’ of the bankable work.

And in the meantime, wheels are now in motion on a process to select a strategic partner to help bring the project through commissioning and into production.

possibly something strange afoot .... though there is no published news, sp is again strong this morning with volume approaching 1.5m already

BAOBAB RESOURCES PLC
PYRO-METALLURGICAL TESTWORK PRODUCES LOW IMPURITY PIG IRON
4 MARCH 2013

Baobab Resources Plc ("Baobab" or the "Company") the iron ore, base and precious metals explorer with a portfolio of exploration projects in Mozambique, is pleased to present the results of pyro-metallurgical test work at its 85% owned Tete pig iron, vanadium and titanium project (the "Tete Project") in which International Finance Corporation ('IFC') hold a 15% participatory interest.

HIGHLIGHTS
-- Bench-scale pyro-metallurgical test work has confirmed the ability to produce a
low impurity pig iron product using Baobab's iron ore and local Mozambique
thermal coal.
-- The reduction and smelting test work has been conducted using coarse
concentrates derived from the Tenge resource block at the Commonwealth
Scientific and Industrial Research Organisation (CSIRO) laboratories in
Australia.
-- Reduction test work using a rotary kiln simulator has returned very promising
results with in excess of 70% metallisation being achieved after a short
residence time using locally sourced thermal coal as a reductive agent.
-- Samples from the rotary kiln experiments were inductively smelted in a crucible
to produce a clean disc of pig iron reporting 97% Fe (at 1.8% C) and containing a
very low level of titanium of 0.002%.

Commenting today, Ben James, Baobab's Managing Director, said: 'the results of the pyro-metallurgical test work mark a major milestone for the project. Two critical questions have been answered: will local thermal coals work in the reduction process and will the titanium separate from the iron when smelted? In both cases the answer is a resounding yes. We now possess very clear physical and empirical evidence to support the Company's conviction that we can exploit the project's unique access to low cost thermal coal at the licence boundary together with Baobab's iron ore to produce a high quality / low impurity pig iron at the bottom of the cost curve.'

market is not particularly excited by the news .... that said, it's a pretty soggy market, and to have any stock showing blue today is no mean feat

Cynic, Steady you almost sound as if you are beginning to believe. 8-)

he's in the red here.......

On the bounce after a 61.8% retracement from the last rise
and a 50% retracement on todays intraday price

for the record

BB - out of these entirely a week or two back

Cynic
I do not blame you to be out. I never saw any virtue in this one from the start.
I suggest you stay out for you own health.
Cloudy in Benidorm today, but was sunny yesterday down by the promenade.
I think Benidorm must reflect the Stock Market just now.
Should be warmer next week I am advised
Bob

out with a profit me...... clever clogs.,.

good for you

How much did you sell it for?

Some have not noticed BAO was on the turn this morning

The Fibonacci retracement was at work this morning as the MMs make sure the share price was marked down to that point and then up again.

naturally followers did help the share price move up fast again

another intraday 50% was triggered once again and so on this afternoon, but the share price finished well up on the day.

I made the chart this morning but kept it from posting here till the share price is well up and someone nasty around this side was not getting my "TIP" at the early stage.

others did got it this morning at other places.

From my thread ......

50% intraday fibonacci retracement at 23.125p and UP she goes

High of the day 24.625p
Low of day 21.375p

50 % fibonacci 23.125p

wow.,.

Wow - down 3.75p today 21.75 / 22.00 or 14.63%
Where to tomorrow ?
Is this for pure gamblers or investors ?

gambling and/or momentum trading only

Interview with Ben James, MD of Baobab - Tete pre-feasibility study return positive result

Click here to listen

has anyone come across this?

panel discussion

Ben, the Baobab CEO is involved.

Cheers Morigam, I'm going to listen to the panel discussion. Good find!