“The company rests on a powerful tripod of interests whose value is becoming less speculative and more real,” Bell said in a trading update on Monday.
The trio includes the 75%-owned Migori project in Kenya; the Red Rock Australasia (RRAL) joint venture with Power Metal Resources (LON:POW) covering 2,188 square kilometres of the Victoria Goldfields region in Australia; and another joint venture with Power Metal focused on copper and cobalt in the Democratic Republic of Congo.
In the past six months, the licenses for Migori, an underexplored greenstone belt in which contains an initial 1.2 million oz gold resource, have been restored and the company said the camp and vehicles in Kenya are currently being readied for the resumption of work by the exploration team.
Electrical, plumbing and repair work is “under way”, with the team preparing options for an initial programme.
In Australia, a corporate office has been opened in Ballarat, Victoria and a new website and presentation are being prepared “to enhance RRAL’s local presence”, while the JV is also been being prepared for a separate stock market listing.
In Congo, where Bell said the situation had been “uncertain and even perilous just weeks ago”, longstanding legal issues have been resolved, and the company “is now in a position to appoint an in-country manager and establish a physical office”, with a contractor engaged to follow up earlier geochemical work and mobilising for ground magnetics and induced polarisation surveys before the rainy season.
“It was a common trope a few months ago that Red Rock looked cheap, given its listed assets and the potential of its projects. If this was accurate, it was not a position different from many other companies,” Bell said in the statement.
“The value was in posse rather than in esse, and the future fortunes of the company appeared to hang largely on one asset, with the expected restoration of its Kenyan licenses.
“The situation now is different,” Bell said. “Kenya is restored since August and granted, an NI 43-101 report has been produced for the Australian assets which leaves no doubt as to their potential, and in the Congo we have defended and even advanced our position with apparent success, and so are now in a position to deploy funds into the country with confidence.”
He said the company will continue to update the market as it focuses its recently augmented financial resources following the GBP1mln placing last month “on strengthening the three legs of our tripod and building the value of the business” but that given the progress on these three key projects, the board has not exercised an option over a potential gold opportunity in Slovakia.