On the 24th of June Sirius announced that it had obtained options from the two remaining shareholders in its Dakota Salts investment to acquire the 49% of the project that it does not already own. The two options were struck on very favourable terms with the price of £1 each entitling Sirius to acquire Transparent Holdings Ltd’s 24% interest in Dakota Salts for £240,000 or 9.6 million Sirius shares and Sojourn Energy LLC’s 25% interest for £250,000 or 10 million Sirius shares at Sirius’s discretion any time up to the 20th of December 2009.

Holding upwards of 5,000 acres of land in North Dakota, Dakota Salts is in the process of developing natural gas and compressed air storage caverns on the back of salt and potash mining operations. Sitting on the salt and potash rich Williston Basin, North Dakota is located on the main Canada / USA gas pipeline and is the windiest state in the US – key factors in gas storage and wind turbine powered compressed air storage. With salt caverns being equally suitable to storing gas, oil or compressed air, Dakota Salts is looking to generate income not only from the mining of minerals, but also from the resulting caverns. This dual income opportunity is an exciting prospect for any developing company and Sirius has moved quickly to secure its position.

With studies currently evaluating the whole mining / storage business proposition, Sirius has wisely negotiated options rather than a straight off purchase so as to be better informed of its purchase. With time a valuable commodity in any business, for a nominal cost of £2, Sirius has bought itself 6 months within which time to be sure that its £490,000 or 19.6 million share issue is well spent. Sirius sees Dakota Salts as a key long term asset for the company and, with energy solutions top of the USA’s political agenda, there is tremendous upside for this mining / energy storage company.

Assuming Sirius chooses to issue 19.6 million shares as consideration for the remaining 49% stake, thus taking its post acquisition issued shares to c.153.2 million, with a 100% interest now in Dakota Salts, our valuation rises to 19p per share from 13p previously. Speculative buy with a 19p price target.