Thursday, April 28, 2011

Straits Asia Resources surges after receiving mining license

Stock Name: StraitsAsia
Company Name: STRAITS ASIA RESOURCES LIMITED
Research House: DMG

Shares of Singapore-listed coal miner Straits Asia Resources (STRL.SI) jumped as much as 7.9% on Thursday to a 33-month high after it said it was issued a license to mine in Indonesia.

At 9:06 a.m., shares of Straits Asia were 5.8% higher at $2.94 with over 3.6 million shares changing hands.

Straits Asia said Indonesia's minister of forestry has issued a borrow and use license to the firm for the Northern Leases at the Sebuku mines, allowing it to begin mining work.

DMG & Partners said this permit will provide support for Straits Asia to ramp up production at the Sebuku mines in Indonesia.

"We believe this is a key catalyst that investors have been looking out for and expect some positive share price movement in the short term," said DMG in a report. It has a buy rating and target price of $3.08 on the firm.

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