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Joint venture set to boost gold explorer

by Dan Coatsworth

Investors hoping for a share price revival in Turkey-based gold explorer Stratex International (STI:AIM) could be in luck if a joint venture (JV) deal plays out. It is in final discussions with an Australian resources group that may fund a feasibility study on the Altintepe project. This should speed exploration and potentially become Stratex’s first mine to go into production.

Stratex last week announced a 43.8% increase in Altintepe’s oxide resource to 472,318 ounces of gold. While a JV proposal has already been received, chief executive Bob Foster says he is also inviting other companies to suggest partnership terms. If a deal cannot be fleshed out, Stratex says it will undertake the feasibility study itself, easily funded by a £4 million cash balance.

Shares in Stratex fell 71% to 3p between November 2007 and September 2008. It continues to make progress with a portfolio of gold projects in Turkey, but has been dragged down by the negative sentiment towards small Aim natural resource companies. The market failed to realise the milestone reported last week in Stratex having over one million ounces of gold across three projects. But investor meetings helped reverse the price movement, resulting in a 12.5% gain to 3.4p on Friday (12 September).

An uplift in newsflow over the coming weeks could push the shares up further. In addition to potential JV news, Stratex will report drilling results on Oksut, which independent stockbroker Fox-Davies believes could hold more than 500,000 ounces of gold. It will also report progress on exploring Karacaoren in Konya, which Foster reckons could be the company’s big porphyry discovery.

Shares says: The company’s projects are starting to take shape. Buy