Australia | May 25 2007
By Chris Shaw
When it listed in March shares in Carnavale Resources (CAV) enjoyed a solid debut as the 20c shares came on at 26c and then trended higher. The company offered exposure to a couple of projects in Brazil prospective for copper and gold as well as some iron ore interests and a relatively tight register of only 23m shares, meaning the stock was well supported.
In April the shares spiked as the company announced it had acquired the rights to the Tres Cores iron ore project, also in Brazil, giving it a sizable amount of prospective exploration ground in which to work and 100% interest in the project.
With the ink barely dry on that deal and taking the view diversification is a good thing, management has now announced the acquisition of the Frei Matinho molybdenum project in Brazil for US$4.0 million and the issue of 1,000,000 shares to Metal Land, in return gaining 100% of a project where previous exploration has uncovered moly grades of 0.4%.
The company intends to conduct an aggressive exploration program in the area as it points out the project remains open at depth and along strike, which is suggestive of further good results being likely. This is supported by the fact within the tenements being acquired there were previously two small moly mines, increasing the company’s confidence it can prove up significant additional reserves.
The market certainly likes the deal, as the stock has shot up by 15% or 15c this morning to trade at a record high of $1.15, meaning those shareholders in the float have enjoyed their money increasing more than five times in the space of a couple of months.
Currently no brokers in the FNArena database cover the company.