If investing in venture markets was a sure thing we would not call them 'venture' markets.
We're riding a commodity cycle here. But if the market keeps going up - so will this stock.
BTW - we are low hanging fruit. Any lower any you'll be picking us up off the dirt.
By contrast, Allana Potash(AAA-V), which holds the Dallol potash project in Ethiopia, on Africa'seast coast, has had to turn potential partners away, despite having arelatively early stage project.
Last year, the company backed outof a proposed joint venture with China Co. after finding it had betteroffers from other investors. (The deal would have seen $4.5 millioninvested in the company in return for just under 20% of Allana's sharesand 70% of Dallol's capital costs paid for.)
The company recentlyraised $12.4 million through a private placement with Liberty Metals& Mining Holding (a subsidiary of Liberty Mutual Group). The moneymeans the junior is fully funded to the end of a feasibility study.
LastNovember, China Mining United Management put $2 million into thecompany. The company can secure 20% of production from a mine at Dallolif it picks up 35% of development costs, estimated to be around US$280million.
Dallol holds an inferred resource of 105 millioninferred tonnes grading 20.8% potassium chloride. BHP, Anderson notes,has a significant plot of land next to Allana.
Dallol is not onlya solution-mining project, but it's also a comparatively shallowdeposit, with mineralization starting at less than 50 metres depth(against 1,500 metres for Saskatchewan deposits). That means potentiallylow-cost production using solar evaporation. Infrastructure, however,including roads, electricity and water are limited or non-existent.
"Whilethe asset presents some challenges based on its location in Ethiopia,the potential for solution mining and interest expressed in the companyby Chinese suitors makes it another candidate for consolidation,"Anderson wrote in a Nov. 23 research note.
He has a speculativebuy rating on Allana with a 12-month target of 90¢ a share. It'srecently traded as high as 81¢, though it's since come back down toabout 66¢.
Robert Winslow, an analyst at Wellington West Capital Markets, has a "strong buy" rating on the stock and a target of $1.20.
The company has 96.5 million shares outstanding and a 52-week range of 29¢-81¢.