I hope everyone here had a very good Christmas - looking ahead to the New Year, does anyone know where I can find a list of Shares Mags tips in this weeks cover story? I can't find a newsagent that sells Shares Mag around here, even Sainsbury's have stopped selling it!

Thanks in advance,

SB

By the way, I have posted my top 24 shares (from current my portfolio) on another site, to avoid copying & pasting everything twice, here is a link, but please feel free to reply on this thread:

http://www.sharecrazy.com/cgi-bin/ultimatebb.cgi?ubb=get_topic&f=3&t=010382

1) AVM - Avocet Mining (69p)
2) CBM - Cambrian Mining (47p)
3) SBE - Sibir Energy (17p)
4) PXC - Pipex Communications (7.5p)
5) OXS - Oxus Gold (74p)
6) TSG - Trans-Siberian Gold (133.5p)
7) MRS - Melrose Resources (150p)
8) ITL - Intec Telecom (59.5p)
9) DRS - DRS Data & Research (56p)
10) FWY - Fayrewood (73.75p)
11) DATA - Datacash (50.5p)
12) NAE - Nord Anglia Education (265p)
13) GOL - Golden Prospect (34p)
14) NCH - nCipher (153.5p)
15) SVR - ServicePower (39.5p)
16) FSJ - James Fisher (257.5p)
17) JKX - JKX Oil & Gas (48p)
18) FIB - Fibernet (91.5p)
19) OYS - Oystertec (15.5p)
20) MLB - M.L. Labs (27.5p)
21) CDN - Caledon Resources (12p)
22) KMR - Kenmare Resources (14.25p)
23) PTS - Patsystems (17.5p)
24) SPS - Superscape (28p)

The reasons for my choices can be seen on SC BB - sorry for not posting everything here, but it seems silly to copy and paste it all across multiple BBs!

Good luck to everyone in the New Year,

SB

The link doesn't work

Try it now: http://www.sharecrazy.com/cgi-bin/ultimatebb.cgi?ubb=get_topic&f=3&t=010382 except you are right it doesn't work!

Shares tips for 2004:

Long - MCTY,PAG,LAC,CASH,LNGO,BLND,VLX,PDR,CRTO,BVS,UBM,SMG,HILS,LLDR,HDYS,ULG,FPT,PRM
Short -
.BA.,BOY,

Sharecrazy appears to be down this morning,I have not been able to get on the site since 8.00am.

SC site & link now working....

Many thanks fundamentalist - are they your tips or Shares Mag's tips???

Share bear,

Well I hold three of yours, so I hope you've picked them correctly!!

Personally I think 2004 will be the year for commodity and resource stocks, and my favourites are;

Avocet Mining (nap)
Oxus Gold
JKX
Regal Petroleum
Mano River
Cardpoint
PDX

Watching the following;

Stirling Energy
Ramco
African Diamonds
River Diamonds
Marakand Minerals
Western Silver Corp (Canada)

Good luck with them Andy,

If you like investing in the smaller mining companies, you may like to check out Tiger Resources (TIR), they have a nice little collection of them for only 2p!

I can oftem buy at around mid price with comdirect, so the spread is smaller than it appears too!

http://www.tiger-rf.com

On this website

http://www.moneyam.com/sharesmag/edition49/?page=cover

Tom on Shares on Ascot Mining

I was involved in Shares Magazine at its launch as a writer. It is fair to say that it has not lived up to its initial high expectations in many ways. A piece appeared yesterday on Ascot Mining which quite simply shows that its cheapo/low calibre staff do not know what they are talking about. With our funds owning almost 20% of Ascot I might be enraged by this crap journalism but I cannot believe that anyone takes these losers seriously. Below is my critique of this piece, published in response to a few reader queries. Shares is in italics, I am in bold.

Brave investors should trade Ascot on forthcoming news but there could be trouble in the wings.

Ascot rushes ahead

Buy Costa Rica-based Ascot Mining (ASMP:PLUS) at 50.5p ahead of its Chassoul mine hitting full processing capacity by March and the shares moving to Aim soon thereafter. Ascot should also attract investor interest from maiden production at its Boston joint venture, expected this week as Shares went to press.

I cannot argue with this conclusion.

Although there are positive catalysts to drive up the shares in the coming months, we have a negative stance on the stock in the long term as there are elements of the companys business strategy which are not best practice in the mining industry.

So buy then sell spivs! The comment about best practice is wrong as I shall explain below.

Ascot is focused on small high-grade underground gold mines that either used to be in production or have historical exploration data to enable fast development. It plans to have a handful of mills to convert ore from a portfolio of mines into a concentrate which is sold to a third party. Ascot then sends the leftover material to a central processing facility where it can recover any leftover gold.

Wrong. Ascot will use gravity processing to extract about 50% of the gold from rock itself as this is cheap and environmentally friendly. It will then reprocess the rock to extract more gold itself via leaching ( more expensive less green). There is no third party involved.

Chassoul is currently processing 50 to 75 tonnes per day of material grading around nine grams per tonne gold. Ascot says this will reach full capacity of 150 tonnes per day in two months time. Next year it hopes to add a further two mines Tres Hermanos and El Recio to achieve annual gold production of 34,000 to 35,000 ounces of gold.

Wrong: Chassoul should deliver 15,000 oz itself. Boston will add another 2,000 oz. The additional two mines should take output to 35,000 oz but that will be in 2011. That is this year.

We suggest this is only a short-term trading buy as there are three red flags over the companys business strategy. First, we are concerned Ascot is rushing into the development of El Recio, the one project in its portfolio that has not previously been in production. Ascot reckons there are one million ounces of gold, even though it has not yet drilled the project. Chief executive officer David Jackson says there is already enough confidence from historical workings to start blasting the rock and prove up a resource at a later stage.

Wrong: There is extensive historic data on El Recio so the resource statement can be made with some confidence. Frankly for a mine that might produce at 20,000 oz per annum there is some margin of error on Ascots side. Why not drill up a JORC resource see below. This was all explained in full to the journalist who wrote this piece but I guess he did not get it.

Second, we are also worried about Ascots decision not to conduct feasibility studies. It prefers to jump straight into production. As we warned last month (see Shares, 2 Dec 10), there is a high risk of junior gold miners collapsing after a years production due to a lack of working capital if they have not spent time to understand the resource. Gold veins pinch and swell so a business which does not have a precise geological model could easily lose the gold mineralisation and/or end up mining excessive amounts of waste rock.

Wrong and I really do despair at this point. The Costa Rican gold belt is characterised by long thin high grade veins. Drilling numerous exploration holes ( as one would do with a big thick low grade resource) merely pisses away cash without telling you anything much about the size of the asset. One makes assumptions about the length of the veins based on parallel structures that have already been exploited. Thus at Chassoul a couple of long veins have been tapped, 7 others run nearby in situe. Best practice with such structures is just to go in drilling and extract gold as you go along. A company you may know well (Medusa) follows this best practice as it operates on similar structures. As a result Medusa has a low proven resource but just keeps on hauling out 100,000 oz a year and as it takes gold out it taps into another vein to maintain the resource. Best practice on long thin high grade veins is to do just as Ascot is doing. To do as the Shares moron suggests would be financial hari kiri.

As to cashflow issues. On a fully diluted basis Ascot has net cash of c3 million. It is now generating cash from output on a monthly basis. If it produces 30,000 oz it should be sitting on c20-25 million net cash. It can afford the odd lower output month with that sort of cushion. If Ascot wants to arrange a cashflow crisis it should hire someone from Shares Magazine as its new CEO, cease production at once and engage in expensive drilling to define a meaningless resource. I think that is unlikely.

Finally, up to 20% of the 34,000 to 35,000 ounce production forecast in 2012 will actually come from buying gold from third parties. Ironically, Ascot is buying its own gold it will purchase the metal from artisanal miners who have illegally extracted the gold from Ascots projects. Ascot admits it will make a smaller profit margin on this gold but refuses to disclose the extent of the margin loss. It says the agreement is necessary to build relationships with the local community and says the level of purchases will diminish over time.

Wrong. A small portion of output from the Boston concession is under this arrangement although Ascot controls the mine. I guess c 10% or less of total output. Ascot paid peanuts for its Boston contracts and it will generate c1 million free cashflow per annum for it. I really cannot see why that is a bad deal.

Shares says: We see near-term upside to the share price but do not lose sight of those red flags. Trading Buy. Tom says: This article contains numerous factual errors or worse still assumptions which show the author does not know what he is talking about. The shares are clearly worth at least 150p and quite possibly 250p. Shares Magazine costs 400p an issue but is worth virtually nothing. Actually that is unfair, I have not read Shares for years but then neither has most anyone else.

Tom Winnifrith
www.JPJShare.com
www.t1ps.com
www.t1psim.com
Posted by ShareCrazy on Jan 21, 10:36 AM in Comment