Rocher Deboule (TSXV: RD) - Profile: Artillery Peak Manganese

POSITIONED FOR TAKEOVER BY A STEEL COMPANY? 

 

Larry Reaugh, who's already started producing mines in the past and seems to have a knack for spotting new opportunities abit ahead of the curve (like moly), is positioning this company as a mineral resource base for a major Steel company. In addition to some niobium and fluorite properties (both used in producing steel), the largest stride RD has made in fulfilling that potential is with Manganese.

MANGANESE

Manganese is basically indispensible in the manufacture of steel, giving steel it's foundation strength and hardness (without Mn a steel utensil would shatter if you dropped it on something like concrete). Manganese isn't like alloy metals that give steel specialty characteristics like rust and heat resistance - those have alternative metals steel manufacturers can resort to when prices escalate. Witness the steel market's reaction to Nickel late last year. Manganese on the other hand simply does not have any feasible substitutes. So if steel supply is important (it is), so is manganese.

And in keeping with the "Reaugh model", manganese has seen a substantial increase in price in a short period of time recently. But while some base metals have seen increases in the order of 10x plus (like moly), manganese "only" tripled in price in 2007. So there's probably considerably more upside in the Mn market.

ARTILLERY

In 2007 Rocher Deboule made several acquisitions of properties with Manganese production potential. By far the most significant is the Artillery Peak Manganese Properties in Mohave County, Arizona.

Highlights:

(1) They've got a newly-updated NI 43-101 compliant Resource Calculation:

                        Tonnage      Grade    Total Mn lbs.

INDICATED   9,272,442       3.79%    772,475,549

INFERRED     2,553,000      3.82%    215,050,000

- that's nearly 1 billion lb. manganese in total - price has stabilized this year around $2 /lb.

(2) There could be (alot) more than that - news release June 24 says in part:

"

Negotiations for some of the adjacent patented claims have been finalized within the past few days and these acquisitions are expected to provide a significant increase to our resource over the next few months." That's in addition to the further drilling scheduled this Winter - they closed a $1.6million PP in Feb. 2008 so they should be budgetted for that and beyond.

(3) The resource could be cheap to produce / quick-to-production:

- nothing particularly challenging in the geography or location;

- based on newer photos and some of the text in the new NI 43-101 there's alot of ore near surface and even sticking out of the ground;

- some ore previously stockpiled;

- some claims in the property group ready to go: the MacGregor Pit for example (largest of several) is completely ready to mine with benches in place etc.

(4) They've got an actual TimeLine out on their website (unusual for Juniors in pre-feasibility), and though they're in it's early stages they're executing on time or better...

link to Artillery Peak property webpage:

http://www.rdminerals.ca/iocg-mining-resources.php?mainpage=25&newpage=8...

AND THEN THERE'S THAT IOCG TARGET IN B.C.

They probably have news coming soon about their Rocher Deboule (historical minesites) property in central B.C. - my hunch, given the nature of how the expenditures of those PP's work: conditions on how / where it is spent don't always allow for the sole pursuit of the most recent, most promising prospect