Couldn't see a thread for vgm following the transition from rvd and now producing gold at Vatukoula in Fiji. Looking to ramp up to a rate of 110,000 oz per annum by mid 2009 with current rate of production probably a little over 60,000 oz per annum.

Making good progress towards their targets.

110p... looking very grim... could go sub 100p.

re post 408 - i shall very unkindly say that only those no-brainers bought ...... sorry bb, hlyeo and aldo

made me good money in the past but agree should have sat on hands.,.

Excelent write up on VGM in last few days by Ross Jones of Scrazy. Show the Company to be very cheap going forward.....



Buy Vatukoula at 91.125p
Says Ross Jones of t1psim.com

We own a shed load of these shares in our fund I declare this at the start. We are damn glad we hold them as they are dirt cheap. Let me also declare that! However, the share price of Fiji focused miner Vatukoula Gold Mines has been in the doldrums as of late. The last six months have seen the miner come off a high of circa 225p to where the shares currently trade at 91.125p, valuing the company at just 85.4 million. A trend of disappointing short term production downgrades and swollen costs associated with longer term focused mine developments coupled with a surprise ( if relatively small) placing at 125p, has seen solid downward pressure on the share price which simply does not reflect the fundamentals of the outstandingly strong long term bull case.

Our view is that the price weakness is a great opportunity for the long term investor and hence we have bought more at these depressed levels and here is why.

Forecasts for full year Gold production has been consecutively revised down over the last two quarters and for the current year to August 31st the management has now provided guidance of 55,000 ounces having produced 41,487 ounces up to the end of Q3. The company is paying the price of over promising and under delivering but has focused itself upon accelerating its long term mine development aimed at enhancing production capacity. In the short term this has seen lower than forecast grades processed and costs become swollen, but in the long run should position the company well to hit its target 100,000 oz output level. We reckon it will be shooting at that level by early 2012.

The stock market does not treat short term disappointment well and in this transitory period leading up to full output there is scope for continued share price weakness here. But once target output is reached, at 100,000 ounces ($1,500 Gold) and forecast costs per ounce of circa $880 Vatukoula will be generating free cash of 39.1 million. With insiders recently buying reasonable amounts of stock at 110p (CEO & Chairman) and Vatukoula currently trading on a projected multiple of just 2.2 the bad news, and disappointment are more than discounted here. The long mine life and potentially economically attractive exploration upside provide further justification for investment here. The current share price weakness should be seen as a buying opportunity.

I would add as a potential bonus that there is no reason why output could not be hitting 130,000 oz by the end of 2012 as some higher grade open pit deposits near the main mine are exploited. That would alter the maths materially both by increasing output but also by reducing unit costs by (perhaps) $100 oz. Moreover the company is also working on a biomass fuel provision system which could be onstream within a year and would cut cash costs by $140 oz. And finally, we think that gold is heading a lot higher than $1500. You can play with the maths yourself but under some circumstances this company is now trading on a cashflow multiple of little more than 1.

Ross Jones
www.t1psim.com

13/07/2010

Is it a case of " well ,he would say that " being paid and working for Tom Winnfirth's GOLD Fund who's largest holding is VGM

VGM third biggest holding in Winnies successfull Gold fund........

Top 10 Holdings
Stock Name Fund %

Ascot Mining 7.85
Great Panther Silver 6.21
Vatukoula Gold Mines 5.89
Hambledon Mining Plc 5.54
Ariana Resources 4.88
First Majestic Silver 4.57
Athol Gold 3.46
Angel Mining 3.26
Romios Gold 3.18
Sovereign Mines 3.11

http://www.t1psim.com/pdf/Gold%20Fund%20Issue%2027.pdf

Not a big fan of Winnies but he does seem to get most of his miners right these days.

Also i think Wendy Durham has VGM as a long term hold. Bad move by Tom W to sell CEY and MML i think.

Wendy durham, havent seen her for a while. Normal on over the road on a mining site or two.

Glad to see these creeping back up, got greedy and bought at wrong time.,.

Actually going up today!

This is a disaster now - 70p

It's all a disaster :((

solg and eog are similar stocks that some promoted as being the next sliced bread

A well respected Pi has just bought in,so took a look and came up with this interesting post.


My Dad's (ex geologist) take:-

This is a worldclass deposit that has produced 7m ounces of gold so far and still has a resource of over 4m ounces with recent exploration pointing to more to come. Reserves of around 800k ounces, sufficient for the next eight years will be increased with infill drilling and new access from the inclined shaft now being developed from 18 to 21 level.

The mine closed due to high costs in 2006 when the gold price was circa $600. Final days struggling meant no development or maintenance and they resorted to highgrading around one of the shaft pillars which damaged it. Assume the price required for disciplined mining at reserve grade as a profitable going concern was 20% higher say $720. Now inflate that at 5-6% compound per annum to 2012 gives an equivalent gold price of around $1000 an ounce. (Not the suggested possible $800 from the ever optimistic management.) That kind of reduction can only occur in about three years time when the new green electric power station is up and running. So by year end august 2012 they might be approaching the long promised 100k ounce annual output at a true cost coverage rate of circa $1000 ounce. Meanwhile at a goldprice of perhaps $1800 and rising there should be $80m surplus at last. Allocate $25 for tax $30m for growth and exploration and $25m for a dividend to long suffering shareholders. If such dividend was 5% of market cap, then that cap would be $500m or £323m over five times the present sorry level of £0.59. It is clear that only gold price optimists would invest in this risky high cost producer but one does not have to be a raging goldbull to see attractive upside possibilities and very little downside left!


The management must be told to stick to their knitting and fully explore their fijian leases BUT NOT TO WASTE SHAREHOLDERS FUNDS EMPIRE BUILDING IN OTHER LANDS! There are many years life left in Vatukoula and shareholders can reallocate their dividends if they so desire as can management holders. Other valuation parameters; at todays market cap $91m resource ounces are valued at $23 per ounce few significant longlife economic deposits are being uncovered today as cheaply as this, then you could not build a new mine at such a small cost. UK mining analysts tend to be over conservative in their longterm gold price forecasts having been consistently wrong for the last ten years, on quite reasonable forecasts this mine can be very profitable again. Finally one has to hope that promoter Paxton has taken a leaf out of Peter Hambros book and is now under-forecasting this years 65k ounce output.


There is a new mine management team in place and development must be opening new stope faces by now, if they can make a slightly better job of sorting ore from waste, and putting higher grades through the mill the future will be bright. Q1 15.5 Q2 16.5 Q3 18 Q4 20 m ounces would get us to 70m ounces fingers crossed. There still remains the tantalising potential for new discoveries both within the mining lease already revealed and in the surrounding ground along the caldera rim. The best place to look for a mine is near a large mine.

Also this from Kingworld.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/12/20_London_Trader_-_We_are_Witnessing_a_Historic_Bottom_in_Gold.html

sold all of mine today , this is one of tom winnfirths favourites bought KMR with the proceeds

VGM is too cheap now at 60p... BUY

you must be joking!

Flooding in Fiji , maybe that's why they seem cheap ? but not if the mine as been effected by the heavy rain.

malaise looks much more than just some short term flooding

50p should be the bottom... not a penny less. Good buy.