News

June 04, 2008

Frontier Mining Might Not Be Averse To A Merger With Another Junior Mining Company

By Our Man In The City

It’s been a long haul and plenty of unfulfilled promises, but Frontier Mining claims to be ‘just a couple of months’ away from finally starting commercial production at the Naimanjal gold/silver project in Kazakhstan, which has been pilot mining for nearly three years. Financial results due later this month won’t show a pretty picture in terms of revenue, as gold and silver production has been hampered by permitting issues and bad weather reducing the amount of ore it could stack. Chief executive Brian Savage says that times have been tough but he believes that Frontier is turning the corner. Indeed, the presence of a second project, the Benkala copper porphyry deposit, makes the company look more interesting. But can shareholders put three years of disappointment behind them and give Frontier a second chance?

Frontier’s IPO prospectus when it floated on London’s Aim market in 2004 said the company would be producing 100,000 ounces of gold annually within three years of admission to the stock market. That goal should have been celebrated at the forthcoming results, which cover full-year operations for 2007. The reality is that Frontier may report just five per cent of this production level. In the first half of 2007, it only produced 816 ounces of gold. The full-year target was then placed at 5,000...