Monday, September 21, 2009

AGS IN THE HOT SPOT

Seems as though AGS is sitting in the middle of one of the world's biggest uranium deposits. Heathgate, which operates the Beverly mine has announced a new discovery to the north of Beverly and close to B4M. Quasar a subsidiary of Heathgate is in a J.V. with Alliance (AGS) and has been drilling and constantly upgrading the B4M deposit.
This can only be good news for AGS as it can be expected that further high grade extensions will be announced.And Deeplode is reasonably sure that a resource upgrade to B4M will follow closely on the heels of the Heathgate announcement.
The lines on the permit maps do not deineate the geological structures.
In the mean time production will begin in the second half of 2010 on the existing B4M deposit after a few agreements are reached.
AGS is certainly still at the front of DeepLode's mind and of others in Collins St (who represent overseas interests.) The top 20 has not moved out of the Gandel orbit. YET !! So Deeplode is not even a trader now...Wait.

And follow the news on hotcopper.com.au Ignore Hot Copper at your peril

Friday, July 31, 2009

GBM Resources (ASX GBZ) has a DeepLode

Malmsbury is now a very quiet village since the Calder freeway passed it by. Its excellent bakery and fine food outlets are still managing well because of the quality of their produce. Very soon Malmsbury may be on the map for a different reason. The early gold miners in this region were restricted by their inability to go deep. But no longer of course!!
Malmsbury, Deeplode was told tonight, has gold but it is buried deep below the calm of this village. Deeplode enjoyed some local wines this evening..Black Jack Shiraz.. and during chat discovered that GBM Resources (ASX GBZ) has its hands on a deep high grade gold deposit under two hills close by the town.
DeepLode as usual urges caution and suggests readers go to hotcopper.com.au where posters are much more enlightened.
But it appears to be a buy which DeepLode will do!!!

Wednesday, July 1, 2009

AZUMAH READIES FOR THE KNOCKOUT PUNCH

Azumah (ASX: AZM) is named after triple world boxing title holder Azumah Nelson.
This Perth-based explorer that has made gold exploration in Ghana its focus since listing in January 2006 based on its latest announcements seems to be getting to the final round in its campaign to get its WA-Lawra project in the north-west of mining friendly Ghana into production and a four-kilometre long gold corridor will certainly help!
Azumah’s aim of getting its gold resource into the region of 1 million ounces looks to be achievable with some to spare because of its rather huge coverage of the prospective belt that has made West Africa a hot spot for gold discoveries.
And all this for about 0.14c a share.
Of course Opes and Croesus did not help with their forced selling last year.
But Stephen Stone the chairman of the company bought up over 3 million of those!
And Macquarie Bank last year soaked up a A$2 million share placement subscribing for 12,150,000 fully paid new ordinary shares at an issue price of 16 cents per share Macquarie is now Azumah’s largest shareholder with an equity position of 13%.
And Stock Analysis says it is a buy with a valuation of .32
After Deeplode’s dinner tonight with some contacts from Hong Kong that valuation looks conservative.
But Deeplode has no expertise in such matters and suggests readers go to the thread on hotcopper.com.au where much can be learned!

Deeplode acknowledges news reports.

Saturday, June 13, 2009

India rejects the Communist Party

India as we know has returned the Congress Party and at the same time lessened its dependence on minority parties. Its success also means the Government can go ahead with its economic reforms. And also now the Indian-U.S. nuclear agreement, a cornerstone of closer ties with Washington can go ahead. This is assured with the demise of the Indian Communist Party which is now out the back door of Indian politics.
Under the agreement passed by the U.S. Congress last year the USA agreed to share civilian nuclear technology, ending a 30-year ban on sales of nuclear fuel and technology that was imposed after India tested and developed a nuclear bomb.
Deeplode thinks that the election results may see change in Obama' s Asian policy towards India just to remind China that it does not yet hold a full hand. And certainly the crushing blow to the Communist Party could mean it may never recover its voter base.
Manmohan Singh will remain as leader but Deeplode sees Rahul Gandhi as simply waiting.

But what this all means is that the capital inflow into India is not captive to minority interests..eg the Communist Party....Major infra structure projects will now go ahead. Australia will benefit.

Sunday, June 7, 2009

INDIAN GROWTH ABOUT TO EXPLODE

Deeplode came across some figures recently which point out the direction of the flow of global finance. And India looks to be on the brink of a huge growth explosion.

Global money appears to be entering India at the rate of $1 billion a week.
In April, foreign institutions poured US$1.3 billion into Indian equities.Then in early May before the Indian elections another US$1.87 billion was invested from outside India. The total for May was US$4.14 billion

And this is looks to be a world wide trend.
Emerging markets are on the receiving end of large inflows of capital.
Since April, $20 billion has flooded into all emerging markets. The Sensex is up 50%, Russia is up 63%, Brazil 60% China 57%, and Argentina 45%.The capital movement is not India-specific but is representative of a movement into emerging markets.
It looks as though BRICS is still alive as a market force but Deeplode's money is on India and China to mostly benefit the ASX.

(News wires helped the information gathering)

Saturday, June 6, 2009

Gandel Mining the Second Generation money machine

John Gandel made his money in property development. His son Ian looks as if he is on the way to establishing a major mining investment house in Collins Street...Gandel Mining.. His holdings through Abbotsleigh..a private company.. include controlling interests in AGS, ALK, BCI and others.
He is about to take control of GIP...tantalum in Egypt...but under the radar through GIP an interest in SRZ (Stellar Resources) with unknown reserves of tin and other base metals in Tasmania..Deeplode ponders his interest in GIP..with all its risks.. but has some faith in John Dunlop who, if genetics are worth anything, should be followed.

Sunday, May 24, 2009

GURRUMUL YUNUPINGU

Last night Deeplode went to the old Palais Theatre in St. Kilda. A beautiful venue which is now the subject of a development plan.
He hopes any development is done well.
But he went to hear Gurrumul Yunupingu.
Deeplode listened, Deeplode shed a tear or two, Deeplode jumped to his feet and gave, along with a full house, a standing ovation for something electric and spiritual.
Gurrumul firstly though silenced a Melbourne crowd packed into one of our favourite venues (Paul Kelly packed it out the night before.) and gave us something never before heard or experienced.
If you have not heard Gurrumul sing then you must... at least to understand the stories he tells.
Here is a review of his London concerts which sums it up nicely.

Geoffrey Gurrumul Yunupingu
Union Chapel, London
* Robin Denselow
* The Guardian, Monday 18 May 2009

It is dangerous making predictions, but here goes. Geoffrey Gurrumul Yunupingu - better known as just Gurrumul - is going to be the next world-music celebrity. He is a blind Aboriginal songwriter who sings in the Yolngu dialect of the Gumatj clan, but this compelling British solo debut proved he has the ability to move from the remote territories of Australia's Arnhem Land to the world's concert halls.

A slight figure sporting cropped hair and a black jacket, he sat motionless throughout the concert, singing and playing acoustic guitar but never saying a word until the final thank you. "He won't talk‚" explained his producer, Michael Hohnen. "But I can feel that he's happy."

Yet Gurrumul totally dominated the hall, from the first notes until the standing ovation. Backed by a classy acoustic band comprising a string quartet, a second acoustic guitar and Hohnen's double bass, he started out like an Aboriginal answer to Nick Drake, with a soulful and emotional treatment of what could have been a sturdy western folk melody, but with lyrics that dealt with the importance to the Gumatj nation of the orange-footed scrubfowl.

It is this unlikely mixture that explains Gurrumul's appeal. His singing was gentle and heartfelt, his lyrics (translated on a screen beside the stage) dealt with subjects ranging from the forces of nature to his ancestors, and yet the melodies were so straightforward and powerful that any western songwriter would have been jealous. Folk, soul and gospel influences were all there, along with a dash of reggae, and he ended with a personal song in English, I Was Born Blind, the screen showing images of his own history. Gurrumul deserves to become a star.

About this article
World music review: Geoffrey Gurrumul Yunupingu, Union Chapel, London
This article was first published on guardian.co.uk at 00.01 BST on Monday 18 May 2009. It appeared in the Guardian on Monday 18 May 2009 on p34 of the Reviews section.

Argonauts set the sails

Lets think about a tenement fifty kilometres from Teck Cominco's Carapateena copper/gold discovery and 75 kilometres from BHP Billiton's Olympic Dam monster. The prospect contains the sort of magnetic and gravity anomalies that get explorers for so-called iron oxide copper gold (IOCG) deposits excited.
What's more, the group that discovered Olympic Dam (now BHP) — dug some holes into the property and intersected "intense magnetite and haematite alteration typical of Olympic Dam and Carapateena".(Thanks to Barry Fitzgerald for his help there.)

And now after the downturn the tenement owners are valued at less than 10c.
Deeplode is checking out Argonaut Resources very carefully. Add its very prospective ground in Laos.

And Kroombit is a looming, and I mean a looming, positive...Some research would be advisable. ARE is a watch indeed.About to run. Like this week!
Deeplode has no idea and posts on his blog for fun!!

Friday, May 8, 2009

Ian Gandel goes to Egypt for Tantalum

It looks like Ian Gandel has located a supply of tantalum to supplement his resource in Australia.
He has recently taken a major interest in GIP which has very promising ground in Egypt but which has suffered from poor management and an inability to get the Egyptian Government moving.
Ian Gandel's capacity to add shareholder value is second to none.(BCI, AGS, ALK etc)
I would think that ALK his rare earth company in Australia will take over GIP as soon as possible.
And the value of GIP will be somewhat better than its now languishing share price.

Wednesday, April 1, 2009

Reporters without Borders claim kidnap by North Korea

Reporters without Borders are claiming on news wires that North Korean forces crossed the frozen and narrow Tumen River which marks the border with China to seize the reporters who are currently the centre of a diplomatic incident.. and on the eve of the controversial rocket launch.
A diplomat's nightmare and China is in the spotlight.
Let's hope it is worked out quickly as Japan and the USA are quite rightly jumpy!!!

Tuesday, March 31, 2009

North Korea testing the world again

Two American journalists detained in North Korea will be tried on charges of perpetrating "hostile acts" against the Communist state, a crime punishable by years in a labor camp, the North’s state-run news agency said today.The news agency is of course the regime's mouth piece to let the world know what it is thinking.
The decision to put Laura Ling and Euna Lee on trial is a strong message from North Korea and coincides with concerns about the launch of a test rocket by the North Koreans next week. Both Japan and the USA consider this "experimental space launch" as another test of North Korea's long range missile program. These two events are timed to test the outside world when its resources are already stretched to the limit.
The North Koreans are on the news wires tonight as saying they will declare war on Japan if there is any interference with the launch. Dangerous words from a dangerous regime...and the USA will be relying on China to tone down the North Koreans...China has some political and economic power at a crucial time in world events.

Saturday, March 21, 2009

When an Irish hopeful went FAR away on a slight hope

Deeplode has ventured into the archives to remind us all that Tullow Oil, which is being touted as FAR's partner in its Senegal lease, in fact started its history with another outside punt also in Senegal.Twenty years ago Aidan Heavey then an Irish accountant followed a hunch that changed his life.
A friend told him that Senegal was looking for a company to develop the country's oil and gas fields which were too small to be of interest to major companies.
"Like most people in Ireland back then, I knew little about oil except what I learned from J.R. on Dallas," he is reported as saying.
But Heavey flew to Senegal on the basis of what was there to lose!!
He read up on the way so he at least knew the jargon.
He won the contract.
After mortgaging his house and calling in a few favours he bought a used oil rig in Texas.
It made it to Senegal but the crew forgot the basics..passports..not exactly surprising for Texans..(ask Geo W.)
The first well was dry but the rest is history!

Now is history about to repeat itself through FAR...with its maybe partner Tullow..which in DeepLode's guess may then be in Chinese hands.
What a story!

Follow the drama as it unfolds on hotcopper.com.au.

Friday, March 20, 2009

China, Tullow and a little far away Australian spec

In spite of a €1.6bn refinancing and a surprise €430m rights issue recently, Tullow apparently faces major funding hurdles over its oilfields in landlocked Uganda. Reports suggest it might have to sell part of the oilfield to a partner because Uganada has no oil infrastructure and a vast pipeline would need to be constructed to bring the oil across Uganda and through Kenya to the sea where it could be exported. The cost of building such an enormous pipeline would be prohibitive for Tullow.
It would need a partner!
And of course which sovereign wealth fund has that capability and has been engaged in extreme dollar diplomacy in West Africa?
And which sovereign entity has been running the ruler over Tullow as a whole?
DeepLode has written extensively on the activity of China in West Africa and of its interest in Tullow. There is no doubt Tullow needs another huge injection of money to keep up its activities in West Africa. China has both the cash, the willingness to take the risk and the political debts it can call in to get it all happening.
And of course there is the matter of our tiny spec First Australian Resources which has a huge acreage off shore from Senegal courtesy of the Senegal Government which is now almost totally reliant on China (and to some extent Indian) support.
FAR is about to announce its Joint Venture partner…..and has been a bit slow to do so…
Maybe a waiting game while China decides which of its three giants gets the partnership…or to avoid criticism of its “oil diplomacy”.. backs Tullow into it under its control.
Whatever DeepLode is watching closely.

As is the thread on hotcopper.com.au
If you are not there you will miss it all.

Sunday, March 15, 2009

AMERICAN CORPORATE ETHICS ARE DEAD

The news wires are reporting tonight that the American International Group, which has received more than $170 billion in taxpayer bailout money from the Treasury and Federal Reserve, plans to pay about $165 million in bonuses by Sunday to executives in the same business unit that brought the company to the brink of collapse last year.
These payments are in addition to $US121m in bonuses already committed!!!

The U.S government now owns 80% of AIG....and they must stop this payout if the US financial system is to hold the little respect left for it.

DeepLode is outraged! Are you?

Saturday, March 14, 2009

THE POLITICS OF SOVERIEGN DEBT

China is tightening the screws on America. It is about to break free from being the adolescent of the international economic arena.

It started in February when this was reported on Bloomberg,

"China should seek guarantees that its $682 billion government debt won’t be eroded by “reckless policies,” said Yu Yongding, a former adviser to the central bank. The U.S. “should make the Chinese feel confident that the value of the assets at least will not be eroded in a significant way,” Yu, who now heads the World Economics and Politics Institute at the Chinese Academy of Social Sciences, said in response to e-mailed questions yesterday from Beijing. He declined to elaborate on the assurances needed by China, the biggest foreign holder of government debt. “the muscle-bound adolescent of the international system"

And this week what was said by the Chinese Premier?

Mr. Wen said on Friday in Beijing that China is worried about its huge stock of U.S. Treasury securities, an ominous warning given U.S. reliance on Chinese borrowing.
"We have lent a huge amount of money to the U.S., so of course we are concerned about the safety of our assets," Mr. Wen said in response to a question at his annual news conference. "Frankly speaking, I do have some worries"

Hmm? Seems the same spin doctor at work!
So typical of the very sharp and well orchestrated Chinese political machine.

But did the USA take it seriously? Yes they did!!

The Obama administration quickly rejected China's concerns that its vast holdings of U.S. assets might be unsafe, in an unusual diplomatic exchange that underscored the global importance and the potential fragility of the Sino-U.S. economic relationship.

So things are serious.

And let's remember that during the Presidential campaign America's debt to China was a big issue. McCain said this to Reuters..

"the first step that has to be taken is obviously we have to stop mortgaging our economy to China ... and asking them to finance our debt."

Well too late!

The question for America is can it sustain its over 700 military bases in foreign countries? The answer is clear.

And now the question for sovereign funds bankrolling America is on the same topic.

Will China, Japan or Saudi Arabia keep financing new American military action?

The answer is equally clear.

And China is using this new found economic power to up its military capacity.
The USA is cap in hand as DeepLode has written before...

During her first overseas trip as the country’s top diplomat, Clinton continued asking Beijing to keep purchasing U.S.Treasury bonds despite its deteriorating economic condition. Clinton said because the economies are so intertwined, it could hurt China if the U.S. couldn't finance the nearly $790 billion stimulus plan.
In other words the USA need China to fund the U.S stimulus package

“We are in the same boat. Thankfully, we are rowing in the same direction, toward landfall,” said Clinton. She added that China and the United States “are truly going to rise or fall together.”

This is desperate politics and demonstrates just how much the balance of power is shifting between the U.S. and China

And this plea from the Obama administration shows just how the balance of power is shifting between the U.S. and China.

And DeepLode has China as odds on.

Monday, March 9, 2009

FIRST AUSTRALIAN RESOURCES AND ITS AFRICAN HOPE

Much interest is being shown in the prospects for First Australian Resources as it gets close to announcing its partner to develop its huge prospect off shore from Senegal.DeepLode has previously written on the circumstances surrounding the fortuitous position that FAR has found itself in with this tenement.
The share market forum Hot Copper (hotcopper.com.au) has much speculation on its FAR thread.
DeepLode's pick is that the Chinese Government will pull a surprise on us and one of its oil companies will be announced as the joint venture partner to manage the project.
DeepLode's reasons for this have been put to readers previously.
Deeplode's position has been strengthened by reports coming out of Hong Kong and now hitting the news wires that one of the potential joint venture partners, Tullow Oil, is the latest Africa-focused energy firm to draw Chinese takeover interest.
Chinese oil giants Sinopec Corp, CNOOC and China National Petroleum Corporation -- parent of PetroChina-- have all looked at Tullow, three un-named Hong Kong-based bankers have told Reuters.
DeepLode suggests that we would be talking $US10b to get Tullow interested in any deal.The Chinese oilers' modus operandi is to hunt down a target and then the Chinese Government decides which entity will be the vehicle for the bid.
DeepLode will shortly be going up to Hong Kong so will be listening closely to any gossip.
But an announcement may come sooner than that.

Friday, March 6, 2009

TIGHT GAS GETTING CLOSE IN W.A.

DeepLode has written earlier about the chances of a huge discovery of tight gas in W.A.
The need to get a new supply of gas to secure W.A's energy supplies was dramatically evidenced by the explosion last year at Varanus Island

The W.A. Senate Committee investigating that gas explosion which crippled W.A.’s gas supply had some evidence placed before it in December about the huge reservoir of “tight gas” in which one of DeepLode’s favourite juniors(ASX: TSV) has a stake.
In his submission to the Senate Committee the former Minister for Energy, Hon Fran Logan MLA, pointed out that that there are drilling programs underway in 'tight gas' reservoirs in the mid-west and Busselton regions. Tight gas refers to gas that is difficult to extract because it is found in rocks with low permeability, needing specialised techniques and equipment for extraction.
Mr Logan informed the committee that:
“The volumes of tight gas in the two regions north and south of Perth are significant; notionally, around 12 trillion cubic feet. If the geological problems facing the explorers are overcome, the security and competition of the gas market in WA will be resolved to a significant degree, and I put it to you that the explorers for the tight gas should be encouraged and assisted both by the state and federal government: through royalty concessions, I believe, in the state area and through funding for the geological sites of geological science support for that exploration through the federal government.”
The drilling by Latent, Alcoa and Transerve is getting close to payday so keep a watch.
You can be sure that the West Australian and Federal Governments will doing all they can to support this project…now and in the future.
As with most interesting plays you can follow the action on

hotcopper.com.au

Sunday, February 22, 2009

Egypt becomes the focus of Terror

DeepLode wrote sometime ago about the increased sovereign risk for investment in Egypt as a result of perceptions in the region about its involvement in the Gaza war.
Unfortunately today in Cairo a terrorist attack has confirmed that view.
Reports suggest that a bomb was thrown from the Al Hussein Hotel overlooking the square where the bomb exploded.This is very close to the Al Hussein Mosque.
Eye witnesses are saying that the perpetrators were two people donning a face veil (niqab) accompanied by one man.
News wires are reporting that seventeen people were wounded, including 11 French tourists, three Germans and three Egyptians when a bomb went off in the tourist district of Al Hussein, near the popular Khan Al Khalili market in the heart of Cairo at around 7 pm.
A conflicting report by Reuters claims that four people have died.
Let's hope this is not the start of a serious campaign to further de-stabilise the region.

(major source..Daily News Egypt)

Saturday, February 21, 2009

Mrs Clinton goes to Beijing

Pundits on the news wires for the past week or two have been pointing to China’s official manufacturing index and an increase in bank lending as a sure sign that China is on the improve and will lead the global recovery.
DeepLode has been consistent in pointing to the enormous potential of China to recover more quickly than other countries. Its cash reserves are enormous and word coming through contacts in Hong Kong, which DeepLode has mentioned, has been optimistic.
Let’s remember that in January car sales in China topped those in the USA…not difficult at the moment but unthinkable in the very recent past.
And also we need to be aware that Beijing has spent only a little of its huge stimulus package announced late last year.
Banks have responded to the government's demand to lend and have extended a monthly record of 1.2 trillion yuan ($US176 billion) in new loans in January.
And now Mrs Clinton is in Beijing heralding a new era in Chinese-USA co-operation.
The new administration in Washington is (painfully) aware that China is its economic saviour and Mrs Clinton is now swallowing her own presidential campaign message. During her campaign Mrs Clinton, in a letter to Henry Paulson, expressed her concern about “the exposure of our economy to economic developments in countries like China. As we have been running trade and budget deficits, they have been buying our debt and in essence becoming our banker.” Get tough was her message!
And now of course she is in Beijing being very diplomatic…after all how do you go about “being tough” on your country’s banker.China will be the first economy to recover…it has indeed started….and the swing of financial power away from the USA will be in full force.
George W’s legacy will take decades to turn around. The U.S.will retreat to re-build. Its forays into every corner of the Globe and its unregulated excesses in financial experiments are over. And China will be making hay...buying up Australian assets, American debt and extending its oil diplomacy in West Africa and the Middle East.
DeepLode again urges don’t sell those Australian spec miners we follow that have good prospects and close production…They are the diamonds in the recovery.

Wednesday, February 18, 2009

TIGHT GAS, BIG POTENTIAL IN W.A.

DeepLode thinks that the giant Alcoa is a very smart operator. It has done some highly advantageous deals in Australia eg the energy supply deal with the Victorian Government has been a bonanza for them.
It looks as though they may be on to another good deal in W.A. Having agreed to farm in to a major stake in the Warro tight gas project in Western Australia’s onshore Perth basin in return for funding development of the field you can bet they will be wringing concessions out of the W.A. Government

Alcoa knows the gas is there (at least 5 trillion cubic feet of the stuff) and to energy starved W.A. that's very attractive.But of course being tight gas the trick is to get it out.The Americans are old hands at tight gas extraction the finer details of which escape DeepLode. However DeepLode doesn't need to be an oil engineer to know that the rewards could be substantial.
A beautiful state of the art, specially designed rig has arrived from the States and is now at work on the first well. Any success will have a huge impact on energy exploration and supply in Australia. The action is dominated by Alcoa Australia with 65% of Warro, project leader and private company Latent Petroleum will hold 25% and a little Australian spec. stock will hold 10%.
That spec stock Transerv Australia (ASX: TSV) stands to be seriously re-rated at any scent of success and news will be forthcoming in the very short term. DeepLode is of the opinion that a little holding in TSV could be the way into a major development backed by major interests...so keep an eye on this project.

Saturday, February 14, 2009

The Australian Bush Fires

DeepLode lives in Victoria.
The past week has been horrific. All the people who are dead have not yet been found.
Those that have been are lying in morgues away from their loved ones.
Many who have been found are not able to be identified.
Other bodies are still in burnt out houses, cars or lying in gullies or creeks where they ran for cover. Those who survived are in shock...and in the parlance of the therapist...in denial. And why not be in denial!
Not only has your home gone but also your neighbours and their boisterous children are dead. Your main street is gone...your farm is gone..your cattle are dead...your fences are gone..no shops, schools, community centres, sports clubs...all gone.
One woman said to DeepLode .."I am alive but I have lost my life."
The beautiful eucalyptus full of their wonderful cleansing oils were turned on us by a freak of nature , in some situations by distorted fellow citizens, and their cleansing oils became destructive fire balls.. Let us hope recovery is possible and if possible is fast. We have lost much and we all are fighting the battle to survive. Join us if you can.

Thursday, February 12, 2009

China goes exploring in West Africa

Deeplode has noticed that the Chinese Premier is visiting West Africa and has made his first stop Senegal. It seems that Beijing is ignoring the criticism from the West that its diplomacy in West Africa is a drive to secure the natural resources of vulnerable African states.
Ah! is the West innocent of that?
But DeepLode is very interested in the Premier's stop over in Senegal.
Could it be that the fabulous offshore tenement now in the possession of a tiny ASX stock FAR has China's attention.?
And the last few days buying of FAR on the ASX has been very upbeat.
After all the Senegal Government..not long before this visit from the Chinese Premier..has granted all rights over the tenement to FAR and the Hunted has retreated.
Now for a joint venture. Deeplode enjoys following the intrigues of international small spec funding and it seems FAR is on the money.
DeepLode follows the spec buy funds coming through Hong Kong...and no doubt about this one...China has been buying.
Some interesting posts on hotcopper.com.au...

easy to join the threads .....just register on line and its free.

Thursday, February 5, 2009

CHINA ABOUT TO SURPRISE ON THE UPSIDE

Deeplode had an interesting round of golf yesterday with some visitors from Hong Kong.

Interesting, not because of the golf swings, but because of the swing in mood amongst the visitors from my previous contact with them. They were actually talking about earlier than expected growth in China and a second quarter rebound.

In summary the points they made went like this

• The IMF on Monday suggested that although 8% growth for ’09 was a challenge it was possible.

• Steel prices have been rising since November, up another 200 yuan this week.

• Credit is flowing faster than expected. A major bank (Industrial and Commercial) has approved 252 billion yuan in loans in January for power grid , rail and road projects as well as to businesses and individuals.Deeplode is aware that these figures can be inflated by the lending process but they are still impressive amounts)

• They also pointed out that in their opinion China had nowhere near reached the limit of its stimulus capacity.

• There were large outflows of sovereign funds into off shore joint ventures. (We in Australia are aware of that!!!)

Deeplode has blogged previously in regard to China’s continuing investments in West Africa and in the prospects of FAR in Senegal

Asia has shown in the past that it can confound the experts by recovering quicker than expected driven by political need, opportunism and the sheer weight of population. The second quarter could be a repeat of that capacity to surprise.

Wednesday, January 28, 2009

China is nervous but Obama is an Ox

Deeplode has returned from the Chinese New Year celebrations in Hong Kong where much fun was had. It takes more than a global meltdown to ruin the mood of the Chinese during New Year.
The fireworks were spectacular, the Flower Show at Victoria Park as well attended as ever and the restaurants were packed. The visits to the shrines and temples were as usual.
But underlying the celebrations were unspoken concerns about the year of the Bull...one certainly wouldn't articulate them during the New Year period but hope is replacing reality.
Indeed one of my friends who had been up in the southern province of Guangdong reported that a daily queue was forming every day in front of a giant replica of the Wall St. Golden Bull so they could touch it for good luck!!
Meaning the people feel more than ever that luck is needed!

However Xie Xuren, China's finance minister, did acknowledge the financial problems in his New Year greeting . The situation, he said, was now "very severe".
An unusual comment at this time of the year.
It indicates a nervousness amongst China's leaders about potential civil unrest which can spread like wild fire in some of the provinces.
The USA's current comments about manipulation of the yuan will not help ...indeed it was one of the factors in China and Russia attacking the USA this week as being the cause of the meltdown. The USA must be careful not to put themselves on the outer and at the same time giving reason for other countries to form "economic blocs". That we do not need.
Much will now depend on how President Obama handles relations with China and the Middle East. Russia needs some allies at the moment and it would be unwise of the USA to provide them with disaffected leaders of countries the West needs.
President Obama was born in the Year of the Ox and this could be very helpful in winning the trust of China.

Tuesday, January 20, 2009

The President's First Action

The first move of the new President must surely be to demand that banks which have received massive public money support through the rescue package immediately begin to LEND. This major function of banks has all but ceased even though the rescue package was built on a platform of expected lending.
The banks however are hoarding the money as squirrels do.
It looks as if the idea of an aggregator bank controlled by Washington is going to become a reality sucking up all the toxic assets littering the American banking landscape, freeing them from fear and getting them back to their primary function...ie capital flow.

But different to the long transition period between Presidents we will know within days if the new administration has the muscle to attack the banking crisis.

DeepLode is in no doubt that America is about to move!

And for a wide spectrum of views on this topic log onto hotcopper.com.au

Monday, January 19, 2009

A General Atomics Classic Power Play for Uranium

General Atomics ( the "famed Blue Brothers") through one of its subsidiaries Quasar has been patiently holding a share in the extension of its Beverly Mine in South Australia for many years.
It has been waiting for a friendly change in policy from the Federal Government of Australia. It now has that and as well a very enthusiastic State Premier .
Its prize is not its approved Beverly mine but an extension to that..The Beverly 4 Mile area..named because of its distance from the Beverly mine.The size of B4M has never been public information. But now its junior partner Alliance Resources is demanding just that.
Quasar (the legal Joint Partner)...Heathgate..General Atomics..the Blue Bros.. want to keep it private... AGS now wants to make it public for share price consideration, listing rules and to alert other big fish of its value so that Quasar has some opposition if bidding for this prized deposit commences.
So it is commissioning out of its own capital an accurate resource estimation of what the deposit holds.
The AGS Board is very savvy. Ian Gandel the major shareholder is an international developer of shopping centres , a keen mining entrepreneur in Australia and one of the country's wealthiest persons.
This is the beginning of a corporate play.....
Ian Gandel has made the first play because right now at current prices AGS is too cheap and too vulnerable.
So get the information into the public arena as quickly as possible.
Skilled negotiation and planned deal closure is the strength of the AGS Board.

And what about the Blue boys

Well
" Blue is a razor-sharp businessman, and interviews with dozens of Blue's associates and sparring partners suggest that he will do anything to maximize profit - even if it means violating agreements. And while some who have locked horns with him simply shrug their shoulders and move on, a few have taken him to court for breach of contract, fraud, and racketeering.
Blue admits to breaking contracts but won't comment on the rest."
(Fortune Magazine)

So a tough fight can be expected.After all he is on record as saying that the USA should have sent unmanned aircraft over Nicaragua on kamikaze missions to blow up the country's gasoline storage tanks. "You could launch them from behind the line of sight," he recalled matter of factly "so you would have total deniability."

WOW...He also owned the aircraft of course..the Predator

But my money is on Ian Gandel getting value for shareholders.

Opinions are those of DeepLode.. quotes from
http://money.cnn.com/2008/10/28/magazines/fortune/predator_gimbel.fortune/index.htm?postversion=2008103106


hotcopper.com.au
has an AGS thread which has it all...but would probably moderate some of DeepLode's speculation.

Sunday, January 18, 2009

It pays to be First in Senegal

As the global economy struggles to find some base from which to continue its growth small explorers are decidedly unwanted.But growth will return and energy requirements will increase. As we have seen even in the interim demand for energy remains strong and available supplies are under stress.
First Australian Resources’ prospects in Senegal, North America and China all have the potential to add serious value for its shareholders. DeepLode has written before on its fortuitous position in Senegal, and its already existing links with the Chinese, which could be a company maker for this minnow.Remember that analysts have estimated well in excess of 1 billion barrels for the Senegal tenements...and this could prove to be conservative.

The upside potential for the value of FAR certainly gives it a very attractive risk/reward balance.The income being derived from its North American assets continue and are not to be sneezed at in the current economic climate. Many juniors would be envious of any income.

DeepLode continues to rate FAR highly especially at such depressed prices.
Of course this is just opinion and for general interest.

Informed discussions can be found on hotcopper.com.au (a classy mining forum here in Australia)

Saturday, January 17, 2009

Senegal Natural Resources Attracting Attention

Although Senegal is facing economic difficulties international interest is, if anything, increasing. France has recently agreed to lend the Government $US165m to pay down its debts to local entities.
This is on top of the considerable input from China that DeepLode has identified in previous posts. Senegal has undeveloped resources including the offshore oil exploration tenement now under the leasehold of First Australian Resources.
Foreign interests want to keep the Senegal economy alive and kicking to protect their existing interests and to get a foot in on new developments...and they will come!

Analysts report that economic growth should recover to something like 5.5 percent a year between 2009 and 2013.
Last year's $100-million injection into phosphates production by Indian interests has helped enormously.

Although a minnow on any scale FAR suddenly has a trump card. Follow with interest!

Wednesday, January 14, 2009

China's African Oil Diplomacy and A Small Australian Oiler

China resumed diplomatic relations with Senegal back in 2005. Since then it has lent it, on very good terms, something like $US161 million dollars. The latest loan was just this month (Jan 7th) for about $US80 million dollars.
It also recently signed a trade deal with Senegal reducing import tariffs on goods from Senegal to zero.It also announced in 2006 that it would spend $US35 million building West Africa's biggest cultural theatre in Senegal. At the same time it announced debt relief of some $US20 million.

So what has that do do with the tiny Australian oil explorer First Australian Resources?
Recently a huge oil exploration tenement in Senegal fell into the hands of FAR when its 60% USA partner, Hunt Oil, unexpectedly pulled out of the joint venture. It gave no reason and being a private company it does not have to.
This posed a problem for FAR as the lease on the tenement was also about to expire.
But against all odds the Senegal Government approved the passing of the tenement to FAR and immediately extended the lease for another 12 months to enable FAR to find a senior partner to fund the drilling at a cost of about $US60 million for the first well.
The tenement is ready to drill as over the past year or so $US20 million has been spent identifying targets.
Now Deeplode makes no assertions about this scenario...readers can do that themselves.
But this situation sure looks interesting.

Monday, January 12, 2009

Egyptian Government at risk

The Egyptian Government may not survive the backlash of its people against its support for the Israeli attack on Gaza. DeepLode has written on this topic before and expressed concerns for Egypt's stability post Gaza. Even if Israel comes out on top of the current unrest it and Egypt are at risk of years of insurgent attacks from beyond Gaza.
In my opinion any short term gains won, at an appalling human cost, will be just that............ short term.
As well, in DeepLode's opinion, Egypt's octogenarian President Hosni Mubarak and his Government will not survive.
And investments in Egypt are at risk. One in particular is the joint venture between Tantalum Egypt and Gippsland Limited.
Directors of GIP advised recently that the Abu Dabbab project's definitive feasibility study has been reviewed and that the total capital expenditure will amount to US$173 million, an increase of US$48 million over the previous November 2007 estimate.
Also they are hoping that the Egyptian Government will rebuild Port Turumbi an old unused port close to Abu Dabbab (mind you the road network is non existent as yet also).
This is just one example of projects facing funding difficulties in Egypt.
Development Banks have already contributed to this project with no progress seen and private equity is on the back foot.
One can only hope there is a turn around.
There is a very interesting GIP thread on hotcopper.com.au...a site worth visiting!
DeepLode hopes Gippsland gets its project off the ground..It could be massive...but another partner is badly needed.

Thursday, January 8, 2009

Agents Provocateurs

The rockets coming from Lebanon into Israel do not carry a message of peace.There is every possibility that they are being fired and funded by agents provocateurs who want to escalate the current war, and I use the word advisedly, into a wider Middle East "incident."
Iran has a motivation to do just that before the Americans get their act together because of their clumsy inauguration process.
We know Iran controls supply lines to Hizbollah so join the dots.
Deeplode has been concerned since the start of this conflict that Iran would find a way to be involved.
It may now be involved.
Danger indeed!


The Inauguration Gap is Too Long

A poster on the very popular and informative forum hotcopper.com.au has suggested that
"The reason there is such a long interval between the election and the inauguration of a US president is so he/she has enough time to ride a horse from the other side of the country to Washington."
Very romantic ...I like it...and it is partly true..it actually used to be twice as long because of the slowness of transport..
It was amended in 1933 because of the then financial crisis!And in this current crisis ridden world the gap seems an extraordinarily long time for the American political processes to be all but paralysed.

But there is another reason as well. The American system unlike our Westminster system has no provision for a shadow cabinet . The president-elect needs time to select his cabinet members and all those other executive roles which are a feature of US governance. And all then needs to be be confirmed by the Senate. So time is needed...and right now time is short.
Perhaps something to be said for our system where the alternative government is ready to go immediately..and does!!!
I am sure the current gap will be under review in the USA

Saturday, January 3, 2009

Taiwan and China reach out across the Straits.

I was present at an interesting lunch yesterday to celebrate the birthday of a Hong Kong friend. I was sitting next to a Taiwanese businessman who has interests in Australia, Hong Kong and London.
Our conversation turned to the warming of relations between Taiwan and China. In general he was quietly supportive but clearly had some reservations. With journeys shorter by 90 minutes, businessmen and travelers are finding it easier to get across the straits.Up until the direct air connections were established a week or two ago if he needed to go China on company business he used to travel via Hong Kong and Macau. But now he is able to fly direct to Guangdong Province, reducing the traveling time by more than an hour. He pointed out that as well as shortening the travel time and distance there is a saving of eight tones of jet fuel. Ah! The minds of businessmen.
Of course it is not only business travelers who are pleased about that….family visits, holidays etc are now much easier with over 20 destinations in China being served and direct postal and freight services also commencing.

So everything is fine?
Well not really. It was explained that significant sections of the Taiwanese people are concerned that President Ma and the Kuomintang Party (KMT) are just a bit too close to the ruling group in China. Taiwan is historically fiercely independent, and with the strong backing of the U.S. has always kept a wary eye on the military power of China. Approaches from China to engage in joint military exercises, in return for reducing the number of missiles pointed at Taiwan are being greeted with much suspicion by the Taiwanese people. Interestingly the businessman’s son was also present and is about to start his compulsory National Service. He was clearly very positive about this and was adamant that Taiwan must maintain a separate and alert military.
The other concern expressed was the KMT’s increasing moves to control and censor both the printed and televised news services.
Apparently during this week thousands of people protested in Taipei against a draft motion that would enable the government to control the public television's news coverage and programming. The view at the table was that this could just be the thin edge of the wedge and that the Taiwanese people were not going to surrender any of their hard won freedoms.
Anyway we will watch with interest and after many toasts…which I have learned to cope with by taking very small sips…the lunch broke up.

Friday, January 2, 2009

Saudi Blames Hamas

Saudi Arabia seems to be blaming Hamas for the continuing attacks on Gaza according to news reports coming out of the Middle East and Europe (The Guardian is one news source reporting this but it is also on general news wires. )
This seems to be a clear indication that the shaky Arab League is again under pressure and that Saudi Arabia is not going to be part of any extreme Arab League action.
Turkey seems to be playing a key role in these new developments offended by what it sees as Israel’s dishonesty when their PM met with Turkish PM Erdogen on Dec 22. It seems that Israel, not surprisingly, set up a decoy position in the talks.

Saudi is saying that Hamas must resume talks with Fatah before the Arab League can give support..
"This terrible massacre would not have happened if the Palestinian people were united behind one leadership," Saudi foreign minister, Prince Saud al-Faisal is reported as saying.

Hamas of course attacked the Arab League position as "pathetic" and further is saying that Fatah is providing intelligence to Israel itself. That is a serious division.

But maybe these divisions are no greater than those in the Arab League.
Some want an immediate summit others do not eg Syria and Qatar want one whereas Saudi and Egypt do not!..Now I am sure readers can work that out!!

The biggest danger is that the Arab League may renege on the Arab Peace Initiative of 2007 in which Israel is assured of the recognition of all Arab entities if it accepts the 1967 borders and recognises an independent Palestinian state.
Turkey’s significant role is evidenced by its PM taking on a whirl wind tour of Middle East states
Syria and Jordan today and tomorrow to Saudi Arabia.
In Jordan he also met with the Palestinian President.
His intent is clear..he is quoted on the news wires as saying "Developments in Gaza are very dangerous developments to which we cannot remain silent both in regards to humanitarian reasons and to regional peace and stability. Turkey has been deeply concerned over the humanitarian tragedy in Gaza and the fact that the Middle East is entering a spiral of violence. The goal of the regional tour upon which we embarked today is to help end this dangerous course of events."
The divide between the hard line states and the Western allied ones is becoming greater and the atmosphere more tense. And of course as protesters are flooding the streets the divide between the “soft line” states and their populations who want action is also becoming greater. The Middle East is on edge tonight.

Sources: monitored newswires. Opinions are mine.