Ami Chief Sold At High Price

Sydney Morning Herald

Thursday July 13, 2006

Jamie Freed

AUSTRALIAN Mining Investments entered the second week of its trading halt yesterday as executive chairman Wayne McCrae fronted a somewhat abridged shareholder meeting in Cloncurry, Queensland.

AMI shares haven't traded since last Wednesday morning when they rocketed to $10 before they were suspended at $7.11 a share.

Yesterday it was revealed that Mr McCrea took advantage of that high share price. He sold 8000 options at nearly $7 each last week, raising $55,700, which he used to convert 278,000 of his options with a 20c strike price into shares. At $7.10 the holding would be worth almost $2 million.

Meanwhile, AMI has been battling with the Australian Stock Exchange to get approval for the release of its latest drilling results amid controversy over previous reports. The announcement still has not been released.

Yesterday's meeting was originally called primarily to issue millions of options to directors, including a package to Mr McCrae worth $46.3 million in pure profit at the last trading price.

But the vote on the options package was cancelled by the Australian Securities and Investments Commission.

So, instead, many shareholders travelled thousands of kilometres to the 'Curry to approve a resolution to change AMI's name to CuDeco. Mr McCrae then hosted a tour of the company's Rocklands deposit.

AMI has told the market the deposit contains a resource of more than 59 million tonnes of 2.04 per cent copper equivalent, including cobalt and gold credits.

But many industry experts have doubts about the size and economic viability of the deposit, pending the release of more information such as drill hole locations, cross-sections and metallurgical test work.

The Herald has contacted Mr McCrae's office and public relations manager for the last six business days in a row to give him the chance to respond to his critics but he refused to return phone calls again yesterday.

He finally returned the Herald's calls last night but hung up after less than two minutes of questioning.

There has been some talk within the industry about the high native copper content at Rocklands.

Norm Stockton, a professor at the West Australian School of Mines, said native copper was generally recoverable but techniques and costs could vary.

At its Rocklands deposit, AMI has given cobalt and gold equivalent copper values when calculating the grade of its prospect. But it is not yet known whether those minerals can be extracted commercially along with the copper. If not, the copper equivalent grade will fall.

"You've got to be very guarded about someone saying we've found this great deposit until you've looked at all the drilling results," Professor Stockton said.

© 2006 Sydney Morning Herald

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