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Alecto Minerals, Caledonia Mining, Avocet Mining, A-Cap Resources news briefs

Contributed by Fox-Davies Capital

Alecto Minerals PLC has announced the start of its current exploration programme at its Aysid Metekel Gold Project located in a highly prospective greenstone belt in north western Ethiopia.

- Technical study highlighted 5 high priority targets
- Commenced comprehensive mapping, soil, rock chip and stream sediment sampling programme
- Work programme to take 12 weeks managed by the Company's Technical Manager, Niall Tomlinson and recently appointed Project Geologist, Tim Strong.

FD Comment: A few days after releasing the results of its exploration programme at Wayu Boda in southern Ethiopia Alecto has started its exploration programme at Aysid Metekel. The Aysid-Metekel gold exploration licence is approximately 50km north and north-east respectively from Nyota Minerals (AIM: NYO) Towchester and Brantham tenements (the Northern Blocks) which are in turn 100km north of Nyota's 1.872Moz at 2.34g/t (indicated and inferred) Tula Kapi gold project.  Aysid-Metekel is also approximately 80km from Aydot-Fiti, part of the Metekel Exploration License owned by MIDROC Gold Mine PLC which also owns and operates the Lega Dembi Gold Mine. In December, Alecto announced it had identified 5 high priority targets following compilation of historical data and regional aeromagnetics with follow up satellite imagery and further stream sediment sampling which indicated the presence of prospective NW - N trending dextral shear zones within the licence. This work programme should allow the company to further refine and prioritise its targets over the next few months.

Caledonia Mining is pleased to announce that the Special Meeting of the Caledonia Shareholders held on January 24th passed the following special resolutions:

- Approval of a reduction of Stated Capital of Caledonia's common shares by 94.10% of the votes cast
- Approval for the issued and outstanding common shares of Caledonia to be consolidated on the basis of one (1) post-consolidation common share for every ten (10) common shares currently issued and outstanding by 89.54 % of the votes cast.
- Subsequent to the conclusion of the Special Meeting, Caledonia's Board of Directors resolved to declare an initial dividend of $0.005 (one half-cent) Cdn. per non-consolidated share.
- Caledonia's non-consolidated shares will commence trading ex-dividend on February 6, 2013.  The dividends will be paid to the shareholders of record at the close of business on February 8, 2013.

FD Comment: Caledonia has had an outstanding year having resolved Indigenisation and gold production of 45,623oz, 27% up on FY'11 at the Blanket gold mine in Zimbabwe. With such strong cash flows, which the company believe are sustainable it announced in November it was planning to pay an initial dividend of 0.5 cents per share. In order to pay the dividend under the Canada Business Act, the company needed to reduce its Stated Capital as a company cannot pay dividends if its Stated Capital plus liabilities exceeds the realizable value of the company's assets. As of the 30 September, the Company's Stated Capital, which was a reflection of historical equity capital raises, was $196,657,000 and so the company was required to make a capital reduction. With this resolved at the Special Meeting the company was able to declare the initial dividend as proposed and the capital reduction does not affect the Company's operations or the value of the Company or its issued shares. The company is now planning to raise production at Blanket from 40Koz in FY'13 (which we believe is conservative) by 90% to 76Koz by FY'16.

Avocet Mining PLC has released its 4Q'12 production results from its Inata Gold Mine in Burkina Faso:

- 4Q'12 gold production was 30,909oz down from 33,067oz in 3Q'12 (-6.5% MoM) and 46,102 in 4Q'11 (-33% YoY)
- Total cash costs (including royalties) were US$1,246/oz compared to US$937/oz (+33%) MoM) in 3Q'12 and US$773/oz in 4Q'11 (+61.2% YoY)
- Total annual gold production was 135,189oz at a total cash cost of US$1,000/oz compared to 166,744/oz at US$693/oz in FY'11 (-18.9% and +44.3% respectively YoY)

FD Comment: Avocet's 4Q'12 production figures make poor reading, although not unexpected. Some of this is due to timing of the gold pour which has added US$190/oz to the costs compared to 3Q'12 with 4,568oz added to the circuit compared to a reduction of 2,631oz in 3Q'12. Cost also rose due to due to consultant fees paid to Alexander Proudfoot, a full quarter of costs associated with the hired mining fleet and scheduled maintenance of Inata's own mining fleet, all of which should be reduced going forward. However, there is no getting away from the fact that having done so well to rebuild investor confidence with the disposal of its underperforming SE Asian assets it will once again take some time before investors can regain confidence in the company's ability to hit its targets in both production and costs.

A-Cap Resources has announced it has been granted coal rights within its Bolau tenements  in Botswana.

- Tenements sit next to Sese Coal and Power Project owned by African Energy Resources and immediately north of the Letlhakane Project
- Thermal coal horizons are interpreted as the up and down dip extension of the the Ses coal project which has over 2.5bt.
- Initial drilling confirms seams are of comparable thickness and quality
- The coal licences at Bolau follows the approval by the Botswana government of the renewal of the Bolau discovery licences PL138/2005 and PL125/2009 and the amendments of those tenements to include coal rights as well as uranium already held by the company.

FD Comment: Originally a pure uranium exploration company, A-Cap discovered coal at Bolau through its uranium exploration program and to date six reverse circulation holes and seven diamond drill holes have intersected coal horizons. A-Cap are now looking at assessing the potential economic synergies of mining and processing its coal and uranium concurrently. Although we have doubts about the quality and logistics of coal in Botswana, with a lack of domestic power and growing demand for coal both regionally and international we are seeing more interest in Botswana and more advanced infrastructure being proposed. With the granting of these coal rights, A-Cap is becoming a major coal and uranium player in Botswana.