The full review and valuation commentary may be found at: http://miningmarketwatch.net/
Excerpts:
“Cloudbreak Resources appears undervalued with only ~84M shares outstanding and trading under CDN$0.10. Cloudbreak has one of strongest land packages for coal exploration in Saskatchewan. Geologists interviewed by Mining Journal believe CDB.V is ideally positioned in the coal trend with superior technical characteristics conducive to finding a deltic-sequence for quality thermal coal similar in size or even larger than what Goldsource found on the same trend. A drill program (permits submitted for up to 40 holes) set for Q2 2009 on the 100% owned CDB.V Dowd Lake Coal Property will begin by effectively twinning a historic 145m variable coal seam intercept (from a former operator in search of kimberlite) that is indicated in government reports as Sub Bituminous C coal, the drill program will then build off analysis of the first hole.
Cloudbreak Resources Ltd. is a Canadian-based mineral exploration company listed on the TSX Venture Exchange (ticker symbol CDB, Frankfurt listing C6K, US Listing CUDBF). The Company has come to our attention due, in part, to the outstanding prospects for coal discovery on their 100% owned Saskatchewan project and, in our opinion, the resulting extraordinary opportunity afforded to prospective investors.
Cloudbreak Resources has ~475,000 acres of coal exploration permits, totaling 21 full or partial townships in Saskatchewan, making Cloudbreak one of the largest landholders in the area. The properties cover the Mannville Formation of Cretaceous age, the same lithology as the Goldsource Border Coal Discovery located on the same coal trend. Cloudbreak's properties are believed to contain basinal and depositional similarities to that of the Border Coal Project area. The CDB.V Dowd Lake Coal Property, directly adjacent to Goldsource's Ballantyne Property, is the target of Cloudbreaks 2009 Q2 drill program. The first drill target will be effectively twin a historical 145m variable coal seam intercept that a Geological Society of Canada report indicates as Sub Bituminous C coal. Many intercepts, such as the aforementioned 145m intercept, were not logged in detail by past operators as they were focused on kimberlite found 'beneath' the Cretaceous lithologies within the Precambrian basement; and not within the overlying Mannville Formation -- Cloudbreak has identified through historic research, the location of drill holes where data indicates that coal exists.
Richard Macey, President & Director of Cloudbreak, offered the following synopsis of the upcoming drill program, "It is a known fact that there is coal in the ground in the region. We have quite a strong land position and feel comfortable that we are going to hit coal. Past historical drill results suggest that this is inevitable, and the Dowd Lake Coal Property is only one area of interest. Cloudbreak has six properties on the map. If results are positive, we'll continue, if not, we'll shift focus to some of our other properties that are easily accessible".
Cloudbreak did an inordinate amount of research in selecting the properties they have, making use of geologists in the know, including government geologists who are familiar with the coal trend, fault lines, history, and nuances of the region. Richard Macey purposefully staked these properties, not only based on the opinion of geologists that they are highly prospective for coal discovery, but because they are just south of the Canadian Shield, where the coal is relatively close to surface, giving the company the opportunity to drill economically.
The properties were also specifically selected for year-round road access and minimal disturbance. Geologist Paul Gray pointed out how CDB.V projects are 'high and dry' properties that can be drilled year-round, unlike the swampy low-land properties of many other companies, which would require an expensive helicopter supported program or a winter freeze-up, the building of ice roads, and the creation of a large amount of disturbance, thus adding to permitting time and cost. CBD.V President, Richard Macey, personally drove the back roads into all the properties prior to staking to ensure shareholders would benefit from minimal disturbance and related cost savings.
What became evident in our conversations with geologists intimately familiar with the area and the properties Cloudbreak possesses is the superior calibre of the land package, the contributed insight that went into selecting the properties, and how CBD.V can benefit going forward. Not only is Cloudbreak able to build on published historic project results, from those that searched for kimberlite, but as Geologist Paul Gray said, "Not every company who'd been there in the 50s, 60s, and 70s had made their information public. They kept their cards close to their chest back then and that is what will build on too, the ability to find some of those drill holes and work it from there." When pressed to explain what he believes CDB.V will find, Paul explained how large coal intercepts originate and how there were basins of attraction in the Mannville in which thickening of coal occurs. "What you are looking for are old bays and/or old depressions which would allow thick concentrations of coal to deposit, like what Goldsource has identified. There is nothing indicating there isn't another deltic-sequence somewhere further north that may hold the same, or even larger targets, and that really blows everything wide open - because the best thing about where Cloudbreak's northern projects are located, is that the target coal lies almost at surface, just beneath the glacial till. You are not looking 80m depth, you are looking merely 20m down, and that makes all the difference in economics."
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