Indaba, where they dig for riches, and some dirt

AFTER a happy summer hibernation Garimpeiro's attention has turned to Cape Town where the annual Mining Indaba is in full swing.

''Indaba'' comes from the Zulu word for ''business'', and among the Zulu and Xhosa peoples of southern Africa it describes an important conference featuring the representatives of different communities.

The Mining Indaba - this is the 18th - is attended by resource companies, geologists, fund managers and financiers. In all about 6500 people have descended on Cape Town to do what mining types do best: network, drink and strike a deal.

With that in mind, Garimpeiro couldn't help but note that Deloitte has chosen this year's Mining Indaba for its new ''Insomnia Index'' - a survey that identifies just what is keeping leaders in the mining sector awake at night.

Deloitte plans to survey as many attendees as possible to take part in the Index, an ''online tool that captures the most significant challenges and opportunities mining companies face when expanding into Africa''.

Sleep, Garimpeiro can assure readers, has never been high on the agenda at the Mining Indaba.

''This is my fourth Indaba, and I can assure Deloitte it's a very specific type of gold digger that keeps many mining types awake long into the night,'' said one Aussie attendee.

Couldn't have put it better ourselves.

ONE Australian who has joined the exodus to Indaba is Colin Ikin, chairman of Perth-based Namibian Copper.

Just two weeks back Namibian Copper struck a deal with Canada's NGEx Resources to acquire its Mogoraib River exploration licence in Eritrea - and most importantly the Hambock copper-zinc project that's a central part of it.

Hambock contains a JORC-compliant mineral resources estimate including 550 million pounds of copper and 1.2 billion pounds of zinc. It's also just 15 kilometres from the new Bisha gold mine opened by Nevsun Resources, which has produced first-phase year-to-date production of 379,000 ounces of gold.

It took Ikin the best part of eight months to land the Hambock deal. NGEx has taken 50 million shares of Namibian Copper, plus a $7.5 million cash payment on the successful start of commercial mining operations in Eritrea.

''We're very excited about it,'' Ikin told Garimpeiro over the weekend. He's hoping to drum up some more investment interest in the project. ''We've budgeted $2 million on drilling in Eritrea this year, and there are already two drilling rigs on the site that have been there since November.''

At its current share price of 15.5?, it makes Namibian Copper a resource play with an effective value of 0.8? per pound of copper equivalent - a bargain basement price, when one considers there are other companies on the ASX valued at about 5? a pound of copper equivalent. ''In those terms, I think we're the cheapest copper play on the ASX,'' Ikin said.

Of course, there's a good reason for that pricing - Eritrea, like so many parts of Africa, comes with its own sovereign risks. ''It's not something we hide from,'' Ikin said. ''Eritrea comes with its own set of issues and problems that need to be dealt with. That said, the latest UN resolutions seem to be a step in the right direction.''

Ikin was referring to Resolution 2023, passed in December by the UN Security Council, which metes out new sanctions on the government of Eritrea. Specifically, the resolution deals with concerns with the ''use of the Eritrean mining sector as a financial source to destabilise the Horn of Africa region''.

There's still a long way to go, but Namibian Copper will stay on Garimpeiro's radar.

ANOTHER speculative buy that is on the radar of quite a few at the moment is Cleveland Mining, given the number of former Fortescue Metals executives on its board.

In July, Twiggy Forrest's long-term deputy at Fortescue, Russell Scrimshaw, was lured out of retirement to join Cleveland. The chief executive is David Mendelawitz, once Fortescue's former chief of ''business improvement''.

Jim Williams makes up the triumvirate of ex-Fortescue bodies.

South America, and in particular some iron ore deposits in Brazil, are high on the agenda.

Garimpeiro notes that Chinese businessman Wang Zhe - principal of successful private Chinese steel mill group Aosen Steel - last September invested just over $4 million to buy 12 million shares in Cleveland, at an issue price of 34? a share. Cleveland touched 41? after that deal, but is now back to 34?.

Twitter @Garimpeiro888