AAA on Financial Post:
.Allana Potash surges on drill results
Comments Twitter LinkedIn Email .Jonathan Ratner March 7, 2011 – 1:17 pm
Allana Potash Corp. shares rose as much as 15% to $1.92 in morning trading Monday after the company reported strong drilling results.
Allana, which is focused on the exploration and development of the Danakil Depression in Ethiopia, drilled to test the southern unexplored limits of its concessions.
The drill hole intersected a 1 metre zone of 44.5% potassium chloride (KCI), which would represent the highest concentration of potash Allana has struck to date, Dundee Capital Markets analyst Richard Kelertas told clients.
“While not particularly thick, the shallowness of the resource (at less than 120m deep) would be extremely suitable for open pit mining, which the company is considering pursuing and on which we have based our NAV,” he said.
The analyst’s net asset value is $2.83 and he has a Buy rating and $2.50 price target on Allana shares.
He said these excellent results of drill hole #11 support the view that Allana is sitting on a potash resource far bigger than its current NI 43-101 resource estimate would suggest.
“Given its position along the southern edge of Allana’s concession, this hole could very well help expand and delineate Allana’s potash resource to the South considerably,” Mr. Kelertas said.
Allana is his top pick in the junior potash space.
.Posted in: Mining, Trading Desk Tags: Allana Potash, drill results, Ethiopia, Mining, potash, potassium chloride .
