New York based market expertise and investment consulting firm Arrowhead Business and Investment Decisions published a report on the potential of South Boulder Mines and its mining prospects. Find below an excpert and a link to the entire report.

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South Boulder Mines Limited is an Australian-listed exploration and development company focusing on multiple gold, nickel and fertilizer prospects primarily located in Western Australia and Eritrea in North East of Africa.

One of South Boulder’s main areas of focus is on its Duketon Greenstone Belt projects which contain the exciting new Rosie NiCu-PGE discovery. The company owns 100% of all gold prospects and participates in a farm-out Joint Venture with Independence Group NL (earning 70%) for nickel sulphide prospects within the same area.

South Boulder Mines Ltd has a 100% interest in the Colluli Potash Project located in the Danakil Depression region of Eritrea (Africa), approximately 200km south east of the Capital Asmara. In January 2011, South Boulder announced the maiden JORC/43-101 compliant resource estimate for the Colluli Potash project. It reported a Measured, Indicated and Inferred resource of about 548MT @ 19% KCl including 119MT @ 23% KCl (total contained potash of 102MT) located at <100m depth. It plans to increase the exploration target to 750MT – 1250 MT @ 18-20% KCl including 450MT – 750MT @ 20-23% KCl in the coming quarters.

South Boulder is currently conducting an engineering scoping study to ascertain the optimum potash processing capacity from 1MT to 10MT per annum. Arrowhead believes that this is a significant landmark which reduces the resource risk and improves the upside potential for the company.

South Boulder also has three (90-100%) owned fertilizer exploration projects in Western Australia. Given due diligence and valuation estimations based on discounted cash flow method, Arrowhead believes that South Boulder mines limited fair share value lies in the AS$6.25 to AS$29.95 bracket. iv This valuation is based solely on the Duketon Nickel and Eritrean Potash project and does not take account of the potential value of the company’s Terminator Gold prospect. We have also presented a comparable valuation based on Enterprise Value/resource and Enterprise Value /proposed capacity to ascertain the value the Nickel and Potash prospects respectively.

South Boulder Mines - Arrowhead BID Due Dillegence and Valuation Report

South Boulder Mines

South Boulder Mines Ltd is pleased to announce that diamond drilling has resumed at the Colluli Potash Project in Eritrea. The drilling is part of an expanded 5,000m exploration program designed to further define and extend known resources. The results will be incorporated into the current engineering scoping and feasibility studies.

To date approximately 1,407m of diamond core drilling has been completed at Colluli in 17 holes.

The planned locations of the first five diamond drill holes are shown in Figure 1. The location of additional drill holes for the program will be determined based on the new results.

In addition, a trial surface gravimetric survey has been completed with results currently being interpreted. Once outstanding drill results are received and interpreted together with the gravity data, the effectiveness of the gravity survey as a targeting tool will be assessed.

A number of key activities are planned to be completed over the coming months including;

• Receipt of outstanding potash assays from holes 006 – 017 which are expected in March/April;
• At the end of March drilling is planned to commence with a second rig that has the capacity to drill deeper and larger diameter core holes for geotechnical and metallurgical test work;
• An update to the initial resource is planned to be completed in May/June and will incorporate additional drilling, downhole geophysical logging and geotechnical/metallurgical data. It is expected there will be an increase to the current JORC/43-101 Mineral Resource Estimate of; o 547.62Mt @ 18.58% KCl (total contained potash of 101.73Mt); o Includes 119.21Mt @ 23.14% KCl;
• A mining engineering study into the optimum processing and production capacity from open pit mining is planned to be completed mid-year. The study will investigate a range of production scenarios ranging from 2Mt – 10Mt KCl p.a. Outstanding assay results and details on further exploration drilling will be released as they come to hand.

Outstanding assay results and details on further exploration drilling will be released as they come to hand.

Figure1 South Boulder

Investor Coverage

Recent investor relations, corporate videos and broker/media coverage on The Company’s projects can be viewed on the website in the “Media Centre” and “Investor Centre” sections by following the link www.southbouldermines.com.au.

About South Boulder Mines Ltd

Listed in 2003, South Boulder Mines (ASX: STB) is a diversified explorer primarily focused on potash, nickel and gold. South Boulder has a 100% interest in the Colluli Potash Project in Eritrea and a 100% interest in the Duketon Gold Project in Western Australia.

The Colluli Potash Project has a current JORC/43-101 Compliant Measured, Indicated and Inferred Mineral Resource Estimate of 547.62Mt @ 18.58% KCl (total contained potash of 101.73Mt); Includes 119.21Mt @ 23.14% KCl; and an exploration target of 750Mt – 1.25 billion tonnes @ 18-20% KCl. The potential quantity and grade of the Colluli exploration target is conceptual in nature and there has been insufficient exploration to define a Mineral Resource (outside the area shown in Figure 1) and it is uncertain if further exploration will result in the determination of a Mineral Resource (outside the area shown in Figure 1). An engineering scoping study into open pit mining and processing to produce up to 10Mt p.a of potash is underway.

Within the Duketon Gold Project area, South Boulder entered a farm-out Joint Venture (JV) Agreement with Independence, whereby Independence can earn a 70% interest in the nickel rights on JV tenements held by South Boulder in the Duketon Project, by the completion of a Bankable Feasibility Study within 5 years of the grant of the relevant tenement.

About the Nickel Joint Venture

The Duketon Nickel JV has had recent success at The Rosie and C2 Nickel sulphide prospects where drilling has defined intercepts of 5.20m @ 9.13% Ni, 1.09% Cu, 0.21% Co and 7.09g/t PGE’s at Rosie and 50m @ 0.92% Ni including 37m @ 1.05% Ni at C2. The deposits are located approximately 120km NNW of Laverton, W.A in the Duketon Greenstone Belt. The deposits are approximately 2km apart and the mineralisation at both prospects is considered open in most directions. A Mining Lease was granted over the Rosie and C2 deposits on the 19 th of November. The Mining Lease comprises a total of 19.13km 2 .

Please find below an excerpt from an interesting article by Dr. Alex Cowie in ‘Diggers and Drillers’ about South Boulder Mines, Eritrea, the Red Sea and the future potential of potash in terms of increasing global demand for fertilizer products needed to improve crop efficiency and agricultural output.

I’ll be up front about this. South Boulder is a speculative investment.

It may not be for the faint of heart. Its potash deposit is still in its infancy. And it’s two or three years until production. It’s also based in one of the riskier parts of Africa, Eritrea: a country that still disputes its border with Ethiopia.

So why have I bypassed my usual insistence on low-sovereign risk countries?

Because this potash deposit is too good to miss.

South Boulder is at early exploration stage of its 100% owned Colluli potash project. Progress has been very fast here. Drilling started on the edge of the Red Sea just six months ago, and the company has already announced its first resource figure of 548 million tonnes of potash. Let me put that in context. It is already almost half the size of Potash Corp’s 1132-million-tonne resource… currently the largest in the world. Not bad for half a year’s work.

But what is even more remarkable is that this 548-million-tonne figure only factors in THREE of the 17 holes drilled so far. The other 14 are being tested right now. And the results will be factored into a new resource figure that you can expect to see before the end of March.

The company believes the resource figure will grow much higher, as they more than doubled the upper range of the exploration target to 1250 million tonnes. Whether this happens or not remains to be seen. But it would make it the largest deposit in the world. Is it really possible? Let’s just say I reckon they’re being conservative! If you take into account that three holes has enabled a JORC compliant 548 million tonnes (Mt) inferred resource, you could infer 17 holes gets you to over 3100 Mt.

Of course, nothing is ever that simple in mining. But even if you halve that estimate – to be safe – you’re still looking at 1550 Mt. And that still exceeds Potash Corp’s figure. And the company is planning a lot more drilling yet.I need to point out that most of this will be in inferred category, which is only the first hierarchy of resource classification. More good drilling results between the current holes will be needed to upgrade it to a ‘measured’ resource that you could be more confident of.

The 17 drill results so far have been very consistent. But this is typical of a deposit created by an ancient sea bed drying out. Millions of years ago this was an inlet of the Red Sea.

The land changed and the inlet was cut off from the sea. So it dried up into a twenty metre thick layer of potash, which then got covered over by a shallow layer of rock.

So it’s not like a gold or copper deposit where the grade can vary from one metre to the next. Potash deposits are more like a coal deposit, where you get a predictable blanket lying across the whole basin. It’s also important to point out that they have only scratched one small corner of their exploration license…..

To read the full article please visit http://www.portphillippublishing.com.au/osi/

Please note that Diggers and Drillers requires you to subscribe to their paid content to be able to read the full article.

Australian finance and investment advisory house Gresham Advisory Partners Limited published the January edition of ‘Group 150′, a ranking of the top 150 ASX listed resources companies (excluding oil and gas), by market capitalisation. According to the report 2010 was an outstanding year for the resources sector. The total market value of the 150 best companies was $606 billion at the end of December, which was an increase of 5.9% compared to November and 16.1% year over year.

The latest edition of the benchmark report complied the top performance by market capitalisation and share price for the 12 month period (only including companies currently in the Group of 150) and a summary of the performance of the 66 resource IPO’s completed during 2010.

South Boulder Mines Ltd has been ranked amongst the top 10 of ‘Group 150′, a ranking of the top 150 ASX listed resources companies (exluding oil & gas) , by market capitalisation.

Listed in 2003, South Boulder Mines (ASX: STB) is a diversified explorer primarily focused on potash, nickel and gold. South boulder has a 100% interest in the Colluli Potash Project in Eritrea and a 100% interest in the Duketon Gold Project in Western Australia.

Within the Duketon Gold Project area, South Boulder entered a farm-out Joint Venture (JV) Agreement with Independence, whereby Independence can earn a 70% interest in the nickel rights on JV tenements held by South Boulder in the Duketon Project, by the completion of a Bankable Feasibility Study within 5 years of the grant of the relevant tenement.

The entire report is available under: Gresham Report

South Boulder Mines commences trading after a news announcement that it upgrades its exploration target to 500 to 750 million tonnes of potash ores from the initial 300 to 500 million. More detailed reports on the new potash intersection are expected to be released in the coming days. The stock reacted with a daily gain of 9% and was the first time braking clearly the 3 AUD mark (3.39 AUD).