MDL getting ready to fry some fish :)

GOLD SPECULATION

There was speculation last week that now Mineral Deposits Ltd was producing 160,000 ounces a year of gold from its Sabodala mine in Senegal, it was looking to make an acquisition.

The talk was that it had settled on the Tasmanian gold producer Beaconsfield Gold NL using the 22 per cent BCD stake that Malaysia Smelting Corp has up for sale as a starting point.

The talk was nonsense. MDL has far bigger fish to fry in Senegal. As noted by Garimpeiro previously, more than 10 million ounces of gold has been found in the past four years within a 25 kilometre radius of MDL’s Sabodala treatment plant.

Of the 10 million ounces, 3.5 million is to MDL’s account, and another 3 million is held by Canada’s Oromin in a joint venture with Senegalese interests and the Saudi royal family. It makes sense to run Oromin’s ore through MDL’s Sabodala plant.

The speculation – and gold’s advance to record territory of $US1100 an ounce – has been a good thing for MDL’s share price. It closed at $1 a share on Friday, making its gain a more than handy 56 per cent since September 1. In a note last week RBS Morgans valued MDL at $1.22 a share.

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