Groote Resources - Manganese

[Huang Chung]

Groote Resources will be the new name of Western Uranium (WTN), after the company's recent transformation.

WTN was a uranium explorer, with a couple of very small projects...pretty much a shell.

In what you might describe as a reverse takeover, a very interesting manganese project has been vended into WTN.

Now, before joing any further, a couple of things need to be pointed out...

1. The leases are only applications at this stage, and
2. Most of the leases are underwater.

If your still with me after that little bombshell, you may wish to read the details of the manganese project deal:

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01010273

and, a very interesting investor presentation:

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01035929

High risk, no doubt, but this project has been picked up right under BHP's nose. I've been told that after the leases were pegged, BHP grabbed the remaining potential leases in the surrounding waters.

If the stars line up for Groote, this project could be a wee ripper!

Disc: Holding

[gazprom1]

HC,

I have had a quick look at the attachments. One question that I have that you may be able to answer. They have just completed a placement at 10 cents a share to prof/sophisticated investors and there are recently granted options exercisable at 20 cents. Current share price is 61 cents. Risk is share price continue to come back towards the new issue price. What have I missed?

[Huang Chung]

Hi Gaz

You probably haven't missed anything and this is a risk. having said that, the last 2 days have already seen sizable falls as placement stock is sold. I have no way of knowing for sure if the share price will retreat much further, but so far, the current price is hovering around the lows of the last couple of days, so maybe we don't go much lower. I picked up stock yesterday around 68c, after the sellers looked like they were done, but then a late wave of selling took it back down.

[Huang Chung]

Western Uranium has now officially changed its name to Groote Resources.

Stock codes GOT/GOTO.

Here's the website:

http://www.grooteresources.com.au/

[drillfix]

HC, that has got to be one of the funniest/weird names of choice for a company to make. Dont ya think? lol

Well, its what money it makes us all right, who cares what the name is providing you get a profit from it :P

[Huang Chung]

What's wrong with a g roote?

[drillfix]

What's wrong with a g roote?

Hahaaaaa HC,

Nothing wrong with a G roote mate, nothing at all,.

Ok I change my mind, what a Choice Name for a company, Excellent~! :P

[denpal]

Well this is worth a punt over the next couple of years or so, in at 61.5c. Those lucky punters in at 10c!!! I'm sure they'll all be free-carried already.

Also, check out who their chief geologist is. A big tick there.

The potential here is far above average.


Groote Eylandt Project – Manganese

Background

Groote Resources holds exploration rights for six tenements covering 1,723 km2 of shallow marine terrain and two islands near Groote Eylandt in the Northern Territory of Australia. These tenements are located immediately adjacent to and contain the interpreted extensions of the world-class manganese deposits at Groote Eylandt currently being mined by Groote Eylandt Mining Company Pty Limited (“GEMCO”), a company jointly owned by BHP Billiton (60%) and the Anglo American Corporation (40%). This mining operation accounts for more than 15% of the world’s high-grade manganese ore production with approximately 70% of its product exported around the globe.

In operation since the early 1960s, the mine produced 2.3 Mt of ore in 2009.

The tenements are considered highly prospective for manganese.

[drillfix]

One question that I have that you may be able to answer. They have just completed a placement at 10 cents a share to prof/sophisticated investors and there are recently granted options exercisable at 20 cents. Current share price is 61 cents. Risk is share price continue to come back towards the new issue price. What have I missed?

Agreed Gaz, you haven't missed a thing (atm) ,

The whole industry and its soph investor thing is getting worst IMO, it used to be a 10% or 20% discount and now 10c? at over a 500% discount, what next? A free baby and pet dog thrown in with ever 1 million you subscribe for?? :scared:

What price will be gauged by the FA and TA strength combined. But for most who read what you have read and made clear, this will eventually work against their favour, but with a SP such as that, the g -root may have eventually just g-rooted itself.

.

HC, you really need to put he Code in the Heading of your post.

[denpal]

Another big tick. Quality management coming on board and putting their own money down as well!

When was the last time a brand-new incoming Chairman stumped up $1M cash to take a share placement? And look at his track record.


ABN 24 119 494 772
SUITE 4, 38 COLIN STREET, WEST PERTH WA 6005
TEL: (+61 8) 9481 4000 FAX: (+61 8) 9481 4088

ASX RELEASE 22 March 2010


Groote Resources Chairman Appointment and Placement

Board and Management Changes

The Board of Groote Resources Limited (“the Company”) is pleased to advise that experienced
executive Mr Chris Catlow has agreed to accept the role of non-executive Chairman of the
Company.

Mr Catlow has a Bachelor of Science in Engineering from the University of Durham, UK and is a
Fellow of the Institute of Chartered Accountants in Australia. Mr Catlow has extensive experience in
the international resources industry and has held various senior roles in major operating companies
and has considerable experience in raising both equity and debt for large resource projects. Mr
Catlow was the inaugural chief financial officer of Fortescue Metals Group, playing a central role
in the development of Fortescue and in raising more than US$4 billion.

Under the terms of Mr Catlow’s appointment, he will, subject to necessary shareholder approval,
be entitled to receive 6 million options on the following terms:
2 million unlisted options exercisable at $1.00 vesting 12 months from issue;
2 million unlisted options exercisable at $1.25 vesting 12 months from issue; and
2 million unlisted options exercisable at $1.50 vesting 12 months from issue.

Mr Maurice Catina has been appointed Company Secretary effective immediately, replacing Mr
Alec Pismiris who has resigned. The Company would like to thank Mr Pismiris for his services in
steering the Company to date. Mr Catina will be the person nominated under Listing Rule 12.6 for
communication with ASX with regard to listing rule matters.

Capital Raising

The Company further advises that it intends to raise additional working capital to supplement its
existing cash reserves to fund the Company’s planned exploration activities at the Groote Eylandt
Manganese Project and Mt Alexander Uranium Project.
.
The Company intends to make a share placement of 1.25 million shares at an issue price of $0.80 per
share to raise $1,000,000 before costs.

The placement will be issued to Mr Chris Catlow and or his nominees. The placement will be
completed following shareholder approval.

For further information contact:

Maurice Catina
Company Secretary
Groote Resources Limited
Tel: (+6 18) 9481 4000
www.grooteresources.com.au

[Huang Chung]

I missed this announcement denpal.

Great stuff...chucking down a million of your own hard earned.

[gazprom1]

Hi Guys,

Looks like it has been a great investment for those thta are in. Good announcement re appointment of non-exec. Annoys me how he is able to subscibe for 1.25 million shares at a more than 20% discount to market and there will be no escrow period. Just made a paper profit of over$250,000. Nice. Didn't even have to pay brokerage=)=)

Gazprom

[Huang Chung]

Gaz, don't forget when he would have agreed to come on board, the share price would have been somewhat less...its had a big rise over the last few days. On the same basis, his oppies would have been well out of the money as well.

But, all pretty irrelevent in the overall scheme of things.

Lets get the leases confirmed first.

After that, it probably will only take one drill hole offshore to confirm the continuity of the manganese into the GOT leases. Then you might see fireworks!

[gazprom1]

Too true HC, good point!!!

[Huang Chung]

Key offshore tenements granted. This is a HUGE step forward to what potentially is one of the most exciting plays on the ASX.

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01083886

I'm back in.

[Huang Chung]

From Proactive Investors:

Friday, July 30, 2010
Groote Resources receives landmark manganese exploration licenses approval

by Andrew McCrea (http://www.proactiveinvestors.com.au/about_us)

Perth-based manganese explorer, Groote Resources (ASX: GOT) has gifted investors with the news worth waiting for - the granting of the Groote Eylandt exploration licenses in the Northern Territory.

Groote will come out of a trading halt with the announcement this morning.

The prospective exploration licences contain the interpreted extensions of proven high-grade manganese resources owned by Groote Eylandt Mining Company Ltd (GEMCO). The tenements under application are along strike from GEMCO’s manganese reserves, where the geology is well understood and manganese is being mined.

The OELAs and Authorisations comprise 15,439 km2 of prospective tenure, immediately to the south and southwest of Groote Eylandt, one of the world’s largest high-grade manganese deposits.

GEMCO (BHP Billiton 60%/Anglo American Corp 40%) operates one of the largest high-grade Mn mines in the world. The mine has produced 50Mt of ore since 1965, has total reserves of 114Mt at 46.7% Mn with a 14 year mine life (3-4Mtpa DSO operation – lump and fine) and currently produces more than 15% of the world’s high-grade manganese ore.

The broad coastal plain bordering the licences under application is known to contain numerous manganese occurrences in geological settings very similar to that found on Groote Eylandt. Two of these sites (Rosie Creek and Battern Creek) are currently the focus of intense exploration activity by other companies.

With this box ticked, Groote can get moving to the next stage and is now commencing an intensive six month exploration program, comprising a three- week non-invasive geophysical survey to generate drill targets (late August) followed by an initial three-month drilling program starting in October.

The company said it is on target with the exploration program to delineate an initial JORC resource by early 2011.

Simon Noon, executive director, said that the granting of these licences, located alongside one of the world’s largest and most profitable manganese mines, represented a very significant milestone for the company.

He stressed that Groote Resources is now moving into an exciting phase of discovery that would result in the establishment of a major new force in the delivery of a range of high grade manganese products for the rapidly expanding Asian market.

Groote is targeting 45-60Mt of manganese ore grading 35-50%Mn. These tonnage and grade estimates are based on comparison with the well documented manganese ore deposit presently being mined on the adjacent mining lease operated by GEMCO.

Should the company achieve this target, Groote Resources would aim to become one of the world’s largest high grade manganese producers.

If ever there was a key inflexion point and rallying point for valuation uplift, the tenement grants provide the springboard.

[Huang Chung]

From The West Australian 30 July...

Perth junior Groote Resources is about to gatecrash BHP Billiton's stranglehold on the hugely-profitable world of manganese mining on Groote Eylandt with the award of five exploration licences around the remote Gulf of Carpentaria island.
Groote placed its shares, at 73¢, in a trading halt yesterday pending an announcement about the status of the Groote Eylandt exploration licences.
It is understood that Groote, having acquired the company which held the five exploration licence applications last November, has now been informed by the Northern Territory Government that the permits have been awarded.
The award is expected to trigger the immediate start of exploration by Groote, initially on the offshore licences in shallow waters around Groote Eylandt while a land access deal with native title groups for nearby Winchelsea Island is negotiated.
Groote would not comment on the status of its licences yesterday.
But BHP is likely to be furious that extensive lobbying to the NT Government to oppose Groote's licence applications has failed.
BHP made clear its displeasure at Groote's initial move into the area in November by immediately lodging exploration licence applications surrounding its upstart's target areas. In the process, BHP also gave credence to Groote's ambitious proposal to dredge manganese off the seabed surrounding Groote Eylandt.
BHP has been mining manganese, a metal used to strengthen steel, on Groote Eylandt since the mid-1960s -- it is one of the global mining giant's most profitable ventures.
BHP's underlying manganese earnings before interest and tax, dominated by the Groote Eylandt venture's contribution, were $US1.3 billion ($1.5 billion) in 2008-09 although the result for the year to June 30 is expected to be significantly lower because of the global financial crisis-triggered collapse in metal prices.
The Groote Eylandt venture, owned 60 per cent by BHP and 40 per cent by Anglo American, contributes 15 per cent of global high-grade manganese supply and is about three times the size of Consolidated Minerals' Woodie Woodie asset in the Pilbara and OM Holdings' Bootu Creek mine in the NT.
The prospect of tapping into such manganese riches has sent Groote's shares from less than 9¢ just before it announced the acquisition of the exploration licence applications in November to $1.20 in March.

http://news.yahoo.com.au/thewest/business/a/-/wa/7673966/groote-muscles-in-on-bhp/

[gazprom1]

HC,

Do you have any views on what BHP's stategy may be in realtion to GOT? Would BHP potentially take them out at this stage?

Thanks
Gaz

[Huang Chung]

No real idea, but, now or later, buying GOT would be a drop in the ocean for GEMCO.

There might be another battle if and when Groote apply for a mining licence, but, if they get to that stage, I'd imagine the share price would be well north of where it is now in any case.

[Huang Chung]

Decided to sell after the share price didn't bounce on news of their offshore tenements being granted. I figure that if the share price didn't bounce on that news, then it probably won't bounce for a couple of months until the drilling is underway.

Also some disquiet with the indigenous population:

http://www.theage.com.au/business/traditional-owners-warn-groote-eylandt-explorer-20100805-11kvb.html

So, I'll probably get reset again around October.

[soulman]

Decided to sell after the share price didn't bounce on news of their offshore tenements being granted. I figure that if the share price didn't bounce on that news, then it probably won't bounce for a couple of months until the drilling is underway.

Also some disquiet with the indigenous population:

http://www.theage.com.au/business/traditional-owners-warn-groote-eylandt-explorer-20100805-11kvb.html

So, I'll probably get reset again around October.

Fair enough HC. I bought the other day for 81. Will also look to exit since Thurs encouraging rush was followed by Fri lacklustre performance.

[gazprom1]

Decided to sell after the share price didn't bounce on news of their offshore tenements being granted. I figure that if the share price didn't bounce on that news, then it probably won't bounce for a couple of months until the drilling is underway.

Also some disquiet with the indigenous population:

http://www.theage.com.au/business/traditional-owners-warn-groote-eylandt-explorer-20100805-11kvb.html

So, I'll probably get reset again around October.

HC,

I decided to buy today...first holding in GOT. SP has drifted lower in the past few weeks and looks like the news flow should start again within the next few weeks. Did not think I would get the opportunity to buy in low 70's.

Are you still out?

Cheers
Gaz

[Huang Chung]

Still out Gaz.

Amazing potential if they can manage indigenous and environmental concerns, and GEMCO doesn't try to obstruct proceedings in some way.

[gazprom1]

I foolishly bought GOT a few weeks back at 70 cents and have been smashed. Rode it all the way down to 32 cents!!!! It is trending up strongly after news of a possible tie in with Korea but still only at 53 cents. They have had a lot of bad press.

Question: does anybody have a clue as to whether they have a chance to negotiate with the locals up there?

Thanks
Gazprom

[gazprom1]

Losses are being cut by the hour....56 cents!

[drillfix]

Sheezus Gaz, thats one heck of a roller coaster ride you been taking mate.

Hope it bursts past your entry to give you some good profits.

MACD looking sweet and price now touching the 50ema, it could test 63c eventually but I think I would scale out of any position just to be sure, and buy back in once all the ducks line up, but MACD crossover signal lines have crossed over whilst in negative territory and would wait until they in positive territory above the MACD histogram prior to scaling out.

[gazprom1]

Thanks DF. I posted on BUR and wondered whether you could look at it from a TA perspective (if you have the time) - it would be appreciated.

GOY has been a shocker. Will ride it a bit longer to see what happens in the next few days but will be looking to get out.Worst trade for ages!!

Gaz

[drillfix]

No worries Gaz, although you mean GOT yes as cannot see no Goy...lol

Ok give me a couple of mins mate, will throw one up for each.

Hey, as you know EMAs have a tendency to draw to each other and either cross or bounce off as does the price on these EMA's.

Dont worry too much about the bad trade, I believe it will recover for you, although should it recover for you perhaps you should take the opportunity to recover ;)

[drillfix]

Ok Gaz,

Here is a daily of GOT

http://i55.tinypic.com/6egiad.png

I really would time this so while the Parabolic Sar dots continue below price.
And
The 13 EMA moves up to the 50 EMA, which by that time, the price will be near 60 to 65c

Also take note of the circle around the histogram on the MACD, this is where the macd signal lines will eventually hit too while the EMAs go to touch.

This to me would be a dump zone to reduce holding.

I then would be watching for what happens to price to gauge where if the OBV and RSI lines will fall back to either bounce off the previous lines it has recently crossed, it may break back through in which case, you will be glad you dumped because MACD will follow.

And also take note if Parabolic Sar (red) dots appearing above the price, dont watch them, it means prepare a strategy to unload.

Should there be a bounce back up on the OBV and RSI and MACD continues, I would hold to see what happens with the EMAs crossing the 150 EMA, if it does then I would continue to hold.

Truth is, anything can happen in these markets, but thats how it appears to me, atm anyway.

[Huang Chung]

Ok Gaz,

Here is a daily of GOT

http://i55.tinypic.com/6egiad.png

I really would time this so while the Parabolic Sar dots continue below price.
And
The 13 EMA moves up to the 50 EMA, which by that time, the price will be near 60 to 65c

Also take note of the circle around the histogram on the MACD, this is where the macd signal lines will eventually hit too while the EMAs go to touch.

This to me would be a dump zone to reduce holding.

I then would be watching for what happens to price to gauge where if the OBV and RSI lines will fall back to either bounce off the previous lines it has recently crossed, it may break back through in which case, you will be glad you dumped because MACD will follow.

And also take note if Parabolic Sar (red) dots appearing above the price, dont watch them, it means prepare a strategy to unload.

Should there be a bounce back up on the OBV and RSI and MACD continues, I would hold to see what happens with the EMAs crossing the 150 EMA, if it does then I would continue to hold.

Truth is, anything can happen in these markets, but thats how it appears to me, atm anyway.

I'm not really sure how useful charting is with GOT Drilly....share price is currently hostage to sentiment around whether they will or will not be able to explore, let alone mine the shallow sea bed to the west of Groote. Traditional Owners, it seems, are dead against GOT proceeding with their plans. I haven't heard too much from the conservation lobby as yet (except for a couple of posters on Hot Copper), but you'd have to expect a degree of opposition, given the location. I'm sure GEMCO are quite happy to see others gumming up the works for GOT.

[drillfix]

I'm not really sure how useful charting is with GOT Drilly....share price is currently hostage to sentiment


HC, I completely agree, and its the same with many stocks in the Speck department.

The chart for GOT was only as a request for our good buddy Gaz as posted, but I guess if anything, it can give you some ball park estimates on what and how it could happen if momentum or emotion become apparent. As sometimes that all that charts are, proof of emotion and belief.

Are you still holding any of these, it was you who started this thread wasn't it?

This stock has been a bit of a roller coaster, I think I traded it once and then said, too unpredictable when charting. You could make a killing or go broke trying quite quickly.

[Huang Chung]

Not currently holding Drilly, as the potential (or percieved) environmental issues made GOT fail the 'sleep at night' test.

Potential is still there, but it might be a difficult road they travel.

[drillfix]

as the potential (or percieved) environmental issues made GOT fail the 'sleep at night' test.

Ahhhh LOL, I completely understand HC, and hey what a great way to explain that in a brief line.

Cheers mate.

[gazprom1]

No worries Gaz, although you mean GOT yes as cannot see no Goy...lol

Ok give me a couple of mins mate, will throw one up for each.

Hey, as you know EMAs have a tendency to draw to each other and either cross or bounce off as does the price on these EMA's.

Dont worry too much about the bad trade, I believe it will recover for you, although should it recover for you perhaps you should take the opportunity to recover ;)

Hey DF,

GOT has made a full recovery and has made me a profit (after being down nearly 50% a few weeks ago - kind of reminds me of the PLV ride!!!!) so I decided to pull the pin. Appreciate it is in a strong upswing but I am frying the AZZ fish at the moment and am happier to be holding AZZ v. GOT. GOT is a long time away from producing anything and will need to raise capital - but could get taken out by the big boys up there. AZZ on the other hand should/ could have US$156 million in hand TOMORROW!!!!

Hope the markets are treating you well.

Gaz

[gazprom1]

Now NTM after a name change but have a look at the nasty 2 year chart...high near 120 and currently trading at 3.6. Hope evrybody jumped some time ago.

Gaz

[Huang Chung]

Now NTM after a name change but have a look at the nasty 2 year chart...high near 120 and currently trading at 3.6. Hope evrybody jumped some time ago.

Gaz

So much potential, derailed by environmental and indigenous concerns. Maybe just a little too ambitious with respect to their shallow seabed mining.

From memory, I think I actually exited for a small profit.

[denpal]

Likewise I'm long gone from GOT thank goodness!!!! Pays not to hang around when the music stops. Reminds me of GLF which was going well then the wheels fell off.