Galileo Resources: Half Yearly Report
December 17, 2012 (Source: Galileo Resources) — Galileo Resources PLC (“Galileo” or “the Company” or “the Group”)
Interim results for the six months ended 30 September 2012
Galileo, (AIM:GLR) the emerging African Phosphate/Rare Earth Exploration company, announces its interim results for the six months ended 30 September 2012.
- Flagship property Glenover advances into preliminary economic assessment, with results due in Q1 2013
- Acquired a 70% interest in Rare Earth International Limited (“REI”)
- REI’s “Nkombwa Hill” project in Zambia demonstrates significant potential
- Praetorian Resources Limited (“Praetorian”) takes a strategic stake in Galileo
The directors of Galileo, the AIM listed emerging African Phosphate/Rare Earth Exploration Company, are pleased to present shareholders with its interim results for the six months ended 30 September 2012.
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This is my second interim report and I am pleased to be able to report an excellent period between interims. An aggressive approach to our flagship property Glenover in South Africa has brought us closer to a production decision than we could have reasonably expected at the time of our initial involvement with the project.
The Rare Earth market is dominated by China and its approach to exports. During the review period, Rare Earth product prices have declined to more sustainable levels reflecting a more balanced approach to marketing by all concerned. The Chinese approach to the market has become more consistent with increased attention being given to efficiencies and safety within its internal industry. The Western response has included country alliances, company partnerships and aggressive rhetoric targeted at China’s dominance.
There remains no doubt in my mind that a well-positioned resource will have a strategic role to play in providing the West with real alternative sources of supply of the critical Rare Earths.
Galileo is a well-structured Rare Earth exploration and development company. The Company has an exceptional management team with proven technical and commercial background. The Group’s flagship property is the Glenover Phosphate concession, which was a successful phosphate producer for many years. Phosphate, however, is now subordinated to Rare Earth Elements (“REEs”). The project area is known to contain significant REEs and Galileo has verified that the grades and tonnages are potentially sufficient to justify exploitation. With this in mind Galileo has appointed UK-based GBM Minerals Engineering Consultants Limited (“GBM”), a British based engineering company, to carry out a fully independent preliminary economic assessment (‘PEA’) for the envisaged operation
One of the key benefits of the project for a medium-sized operation is the fact that a significant portion of the REE resource is contained in stockpiles from the previous phosphate operations. The availability of stockpiled material negates the cost and associated risks of mining. Exploration performed by the company has identified additional REE mineralisation outside of the historical mining area: our aim is to investigate these mineralised areas with the view to building a larger resource of REE.
As announced on 4 July 2012, Praetorian, a new resource focused investment holding company, acquired a 9.03% interest in Galileo through a share exchange and subscription agreement. Galileo is pleased to participate in Praetorian’s underlying investment model and currently holds 4 million Praetorian shares.
Galileo has the potential, with its near term production, to become a significant REE oxide concentrate producer. The project has considerable potential for increasing the ore resource base. Additionally there exists potential for other nonrare earth contribution in the form of scandium and niobium.
Galileo is dedicated to sustainable and socially responsible development and, as a company, to ensure that all its projects adhere to the highest levels of environmental standards. The Company is also a firm proponent for the role of foreign direct investment as a key form of social development in developing African countries.
The Group reported a basic loss per share for the period under review of 0.75 pence (2011: loss of 5.05 pence) calculated using a basic loss of £584,409 (2011: £544,121).
During October 2012, Utafutaji Trading 112 Proprietary Limited changed its name to Galileo Resources South Africa (Pty) Ltd (“GSA”) to better reflect the company’s operations and relation with Galileo.
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