🕐11.11.13 - 08:27 Uhr

SABLE MINING (SBLM LN) - RESOURCE LIFTS TO 178MT DSO AND SITE VISIT



Hi there, Please find below GMP Europe’s morning note relating to Sable Mining Africa’s JORC Resource increase to 178Mt DSO at the Nimba Iron Ore Project. GMP has a current price target of 21p for Sable Mining (closing price on Friday of 9.55p). If you would like any further information, please don’t hesitate to contact me. Best, Susie [cid:image002.png@01CECBDD.61F8A860] Susie Geliher St Brides Media & Finance Ltd 3 St Michael’s Alley, London, EC3V 9DS www.stbridesmedia.co.uk Tel: 020 7236 1177 | Mob: 07976 749 561 | Twitter: @StBrides1 From: Brock Salier [mailto:] Sent: 11 November 2013 07:02 Subject: Sable Mining (SBLM LN) - resource lifts to 178Mt DSO and site visit [Description: Description: Description: Description: GMP Securities logo email] 11 November 2013 SUBJECT: Resource lifts to 178Mt DSO and site visit IMPACT: Positive – that Sable has maintained its 200Mt target while lifting the current resource to 178Mt today is a key positive.

After our site visit last week, we are confident the 200Mt target will be exceeded once ~30 further holes inaccessible in the 3Q13 wet season are completed (~half drilled already).

The company has maintained its 4Q13 target for PFS, and on the ground good progress is being made toward an MoU governing rail allocation, which we expect in the current quarter, with full IDA (infrastructure development agreement) shortly thereafter. DETAILS: Drilling from a 3.9km x 200m extension area has lifted the JORC resource at Nimba, Guinea, from 135Mt @ 59.4% Fe to 178Mt @ 59.4% including 134Mt @ 59.4% Fe in indicated category, all at the same 40% Fe cut-off grade.

To date 276 holes have been completed, and the company has maintained its 200Mt resource target as drilling continues.

Ahead of mining, a 160-hole infill programme has now started, which aims to prove a portion of the deposit up to measured category. Resource for Nimba, Guinea [cid:image003.png@01CEDEAB.E114E560] Source: Company data OUR VIEW: Nimba just keeps growing – this latest upgrade firmly establishes this is the largest (in fact only >100Mt) undeveloped near-rail DSO resource owned outside the majors globally.

The +38Mt addition is in line with the company’s stated target of +35-70Mt, but most importantly, and verified by our site visit last week, we firmly expect the company to exceed its own 200Mt target.

This requires ~30 additional holes to be drilled (~half of which are complete already) in an area that wasn’t accessible in the 3Q13 wet season.

With drilling set to be complete shortly, we would expect the >200Mt target to be reached early in 1Q13. The infill drilling will be conducted with RC drilling for first time, supplementing the 100% diamond drilling conducted to date.

Being faster and cheaper, we would expect the maiden reserve in 1H14 with the final feasibility study, followed by funding including off-take, debt and equity, for mine build to commence in mid 2014.

Being a simple road, rail and ship-load with no requirement for beneficiation, barging or extensive new rail, we see good potential for 2015 initial production. We were pleased to see progress on Liberian permitting during our visit, and are confident that Sable will be able to secure an MoU governing rail allocation in the current quarter.

In Liberia, the process is such that this will be followed by a detailed Infrastructure Development Agreement (IDA) which covers full details of fiscal terms etc.

We expect to be completed around year end. CATALYSTS: - 4Q13: MoU for rail allocation in Liberia - 4Q13: PFS - 4Q13/1Q14: Infrastructure development agreement for rail allocation in Liberia - 1Q14: JORC upgrade to >200Mt - 1H14: Final feasibility study - 1H14: Off-take, debt and equity finance - Mid 2014: Mine build commences - 2015: Potential first production
Brock Salier, PhD Mining Analyst Email: Dir : +44-207-016-1904
Filipe Martins Mining Analyst Email: Dir : +44-207-016-1905
James Bell Associate Email: Dir : +44-207-647-2806
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