Hi there,
Please see the attached note on Kalahari Minerals issued by Ambrian today.
Please contact me if you require any further information.
Kind regards
Chris
________________________________
1st Sep 2009
Kalahari Minerals - Financing; Further results from Zone 3 drilling Recommendation Suspended Contact Details Research Dean Cooper Cleantech +44 (0)20 7634 4769
Andrew Darke Support Services +44 (0)20 7634 4767
Peter Davey Metals & Mining +44 (0)20 7634 4764
Julian Emery Metals & Mining +44 (0)20 7634 4768
Gurpreet Gujral Cleantech +44 (0)20 7634 4771
Nick Mellor Metals & Mining +44 (0)20 7634 4762
Werner Riding Oil & Gas +44 (0)20 7634 4772
Brock Salier Metals & Mining +44 (0)20 7634 4765
Sales Charles Bendon +44 (0)20 7634 4736
Jonnie Cox +44 (0)20 7634 4763
Anthony Nathan +44 (0)20 7634 4738
David Pettman +44 (0)20 7634 4737
Hugh Rich +44 (0)20 7634 4739
Caspar Shand Kydd +44 (0)20 7634 4735
Trading Lee Hunter +44 (0)20 7634 4753
Darren Knight +44 (0)20 7634 4752
David Mackay +44 (0)20 7634 4751
Nick Screech +44 (0)20 7634 4741
Chris Stallard +44 (0)20 7634 4740
Operations Mike Dack +44 (0)20 7634 4734
Kalahari Minerals (AIM:KAH) Mkt Cap: �350m Price: 177p RECOMMENDATION SUSPENDED Financing; Further results from Zone 3 drilling
Financing
Kalahari has conditionally raised �20m (before expenses) by way of a placing of 11,764,706 new ordinary shares at 170p/share; representing 5.6% of the enlarged share capital of the company. The funds raised will be used to satisfy the Companys commitments with regard to the proposed A$91m equity raising announced by Extract Resources on 26 August 2009. The Company is also in advanced discussion to raise an additional �10m before expenses through the issue of convertible bonds, details of which will be published shortly. Ambrian is engaged by the Company in regard to the placing.
Zone 3 Drill Results
Extract Resources, in which Kalahari Minerals owns 39.98%, has reported new drill results from an area 1.2km south of the existing Zone 2 resource.

The company has reported chemical assays from the first hole in this new area, called Zone 3, which show large intersections of economic mineralisation, including 72m @ 676ppm.

In addition the company has reported infill holes from Zone 1 (highlight of 90m @ 796ppm) and Zone 2 (highlight of 75m @ 1,445ppm). Extract is also now drilling a new prospect, 10km south of Rossing South, called Salem.

Handheld spectrometer readings have identified numerous zones of uranium anomalism, but no chemical assays have been released on the 10 holes completed to date.
Comment
This announcement contains a double-wammy for Extract, and by extension Kalahari: The Zone 3 results are outstanding and it looks like new prospect Salem has come up trumps too.

This is the first hole released from Zone 3 and we expect more like it.

Although only one hole has been assayed chemically, the company map (accompanying the press release) shows five more holes with good grades and widths from hand held spectrometry.

Reviewing the geology, we are in no doubt that Zone 3 will prove into a third zone of economically viable mineralisation, although it is hard to get a grasp on the size at this early stage.

In our view, Extracts wider licence area hosts more than the premiere deposit in Namibia (Rossing South Zones 1 & 2), it is potentially an entire district that may represent the worlds largest uranium deposit with known economic mineralisation extending for at least 7.5km.

At Salem the company map shows eight of the ten holes drilled have good grade and width from handheld spectrometry and we await the chemical analyses with great interest.

The size of the deposit here is likely to be smaller than Rossing South as the resource is hosted by dykes (narrow sheets) rather than the larger granitic body that hosts Rossing South. We have previously noted our confidence in the resource exceeding 300Mlbs in the next six months, and reaching 400-500Mlb if Zone 3 comes in as hoped.

With these new drill results confirming our speculative view of Zone 3, and Salem likely to add to this, we are now confident that the resource will ultimately reach 500Mlbs, and may even exceed that.

For comparative purposes, 500Mlbs U3O8 equates to 29Moz of gold equivalent (at US$850/oz and US$50/lb).


Current (JORC) Ultimate (Ambrian estimate) Zone 1 (Mlbs) 145 200 Zone 2 (Mlbs) 122 200 Zone 3 (Mlbs) 0 100 Salem (Mlbs) 0 25 Ida Dome (Mlbs) 25 35 Total (Mlbs) 292 560
Recommendation
We previously valued Kalahari at �2.19/share, but now suspend our valuation and recommendation pending admission of the new shares to trading. - Brock Salier Ambrian is engaged as corporate broker to this company. Recommendation - Recommendation Suspended www.kalahari-minerals.com This document has been approved under section 21(1) of the FMSA 2000 by Ambrian Partners Limited ("Ambrian") for communication only to eligible counterparties and professional clients as those terms are defined by the rules of the Financial Services Authority.

Its contents are not directed at retail clients as Ambrian does not provide investment advisory services to retail clients.

Ambrian publishes this document as non-independent research which is a marketing communication under FSA Conduct of Business rules.

It has not been prepared in accordance with the regulatory rules relating to independent research, nor is it subject to the prohibition on dealing ahead of the dissemination of investment research.

It does not constitute a personal recommendation and does not constitute an offer or a solicitation to buy or sell any security.

Neither Ambrian nor any of its directors, officers, employees or agents shall have any liability, howsoever arising, for any error or incompleteness of fact or opinion in it or lack of care in its preparation or publication; provided that this shall not exclude liability to the extent that this is impermissible under the law relating to financial services.

All statements and opinions are made as of the date on the face of this document and are not held out as applicable thereafter.

This document is intended for distribution only in those jurisdictions where Ambrian is permitted to distribute its research.

In particular, it is not intended for distribution in and is not directed as persons in the United States.

On the date of this document, Ambrian, Ambrians holding company, persons connected with it and their respective directors may have a long or short position in any of the investments mentioned in this document.

Ambrian is a member of the London Stock Exchange and is regulated and authorised by the Financial Services Authority.

Ambrian is registered in England and Wales no.

4236075.

Its registered office is Old Change House, 128 Queen Victoria Street, London EC4V 4BJ.

Ambrian is a wholly owned subsidiary of Ambrian Capital plc.


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