19th Jan 2015 09:18
LONDON (Alliance News) - Stratex International PLC shares fell on Monday morning after the company reported weak drilling results from the Dalafin gold project in Senegal, which it said means it will not make a payment to an outgoing director which had caused its shares to fall back in December.
Stratex said drilling at Dalafin's Faré South prospect in November and December returned "modest intersections", including:
4.8 metres at 1.06 grammes per tonne gold from 63.70 metres;
3 metres at 1.04 grammes per tonne gold from 23 metres and 5 metres at 0.78 grammes per tonne gold from 72 metres;
2 metres at 1.26 grammes per tonne gold from 50 metres;
1 metres at 4.39 grammes per tonne gold from 42 metres; and
2 metres at 1.07 grammes per tonne gold from 59 metres.
Stratex said the drilling campaign completed by the end of 2014 at Dalafin has not provided a sound basis for undertaking a resource estimation at the prospect, meaning the potential deferred payment to Silvrex, the private company Stratex bought in 2012, will not be made.
The company said the potential for a strike extension of the mineralisation to the north of the project remains, but said this is now a secondary priority.
The gold explorer bought a majority stake in the Dalafin gold project in Senegal when it completed the purchase Silvrex in January 2012. It paid an initial GBP850,000 in Stratex shares, but also agreed a success-based, deferred GBP3.82 million payment in cash or shares which would be triggered by the discovery of a minimum of 500,000 ounces of gold in the first three years of its ownership, a deadline that expired on December 31. The resource had to be Joint Ore Reserves Committee-compliant and independently verified by a Competent Person.
In a statement issued in December, Stratex Chairman Christopher Hall noted that John Cole-Baker, who had been a Silvrex director and moved to the Stratex board when Silvrex was acquired, decided to retire effective January 1, 2015 and step down as a director at the end of March, in line with the plans he had set out when he joined Stratex's board.
Although the 500,000 ounce minimum resource target at Dalafin had not been officially declared at the time, Hall said the company has decided to honour its payment to Cole-Baker as long as a resource is declared early in 2015 based on work being carried out before the end of 2014.
The results announced Monday mean the company will not be making the payment to Cole-Baker, Stratex said.
The group will now focus on the Madina Bafé prospect, also in Senegal.
Stratex shares were down 9.8% to 1.85 pence on Monday morning.
By Sam Unsted; [email protected]; @SamUAtAlliance
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