A thread set up and dedicated to Gold and Mining stocks.

Gold could be set to bounce up again in the near future and throughout the autumn and winter. Higher oil prices and inflationary worries both here and in the states mean its an excelent hedge against the falling dollar and weaking markets.

Please post which stocks you feel may benefit other posters. Lets all try and make some money from Mining.

cheers GF.

Heres a dated but interesting Broker note on the smaller miners in Russia.

Brokers Crumbs



Date: May 26, 2004



WH Ireland Takes A Look At AIM listed Companies Operating Predominantly In Russia And The FSU.


Very timely of Myles Campion, analyst at stockbrokers WH Ireland , to have brought out his research note entitled AIMing for Russia just ahead of the Troika Log forum on Russian mining companies. As he points out several of these have formed alliances with majors viz Highland Gold with Barrick, Peter Hambro with Rio Tinto and Celtic Resources with Alrosa. These majors, however, could also prove to be competitors as the remaining Russian and FSU assets become harder to acquire as demand, and therefore prices, increase.

As the name suggests he has concentrated on those AIM listed companies whose operations are defined geographically by Russia and the FSU. No mention, therefore, of Avocet with a small operation in Tajikistan or Bema Gold which has interests in South Africa and South America. Russia is now the 5th biggest gold producer in the world behind China. South Africa is still the largest producer , but profit margins are being decimated by the strong Rand. Australias declining output can be attributed to consolidation among the mid-cap producers and majors tying up large tracts of land and mothballing mines. The USA, in 3rd place behind these two, has to contend with problems from increasing environmental legislation and lobbying.

The collapse of the Russian rouble against the US$ back in 1998 offered shrewd operators the chance to acquire and produce from a low cost base in US$ terms, utilising Russias good working mines and large reserves and resource bases. A few North American companies had already received bloody noses out there as a result of not using local plant and expertise, so the door was left open for companies such as Peter Hambro Mining. Celtic Resources had already acquired a slice of the massive Nezhdaningkoye mine in Yakutia and was building assets in Kazakhstan. Oxus Mining came next, but it concentrated on the FSU where it formed alliances with the Uzbekistan and Kyrgyzstan governments. Highland Gold acquired the Mnogovershinnoe mine early on and had turned it into profit by 2001. Trans-Siberian Gold secured two projects in Kamchatka in the Far East of Russia at about the same time and the latest entrant is Palladex which has some highly prospective exploration plays in Kyrgyzstan.

The variables used by WH Ireland are interesting as these are crucial to the valuations put on the companies. The spot gold price is US$413/oz for this year, US$404/oz for next and US$375/oz for 2006. Nobody ever knows if they are right about the price of gold until the due date of a forecast is past, but it is unlikely that any of the companies reviewed would agree with these figures. The reasoning is based purely on golds role as a dollar hedge and much store is set by the recent reaction of the US dollar to non-farm payroll data. No mention is made of Americas humungous current account deficit and Mr Campion has clearly not read Marc Fabers excellent book Tomorrows Gold: Asias Age of Discovery or Colossus: The Rise And Fall Of The American Empire by Niall Ferguson.

The same argument applies to the projected US$/ exchange rates which are put at 1.81 this year and down at 1.50 in 2006. More sense is talked about the Russian classification system for resources and reserves which is a vital factor when considering companies operating in this vast country. WH Ireland reckons that Russian C1 and C2 classifications have undergone rigorous and detailed work and can be compared with proven /probable reserves and measured/indicatged resources on the JORC scale. Russian P1, P2 and P3 category resources, however, have not been included in any production schedule or resource tonnage and grade calculation. Instead they have been given a nominal in-ground value of US$5/oz based on pure blue sky potential, which will doubtless get up Mr Hambros nose.

Speaking of which the only two BUY recommendations in this note are Peter Hambro Mining and Trans-Siberian Gold Hambro on the basis of its increasing production base supplying good cash flow to fund further acquisitions, and Tran-Siberian Gold because it is seen as drastically undervalued given its proposed production route over the coming years starting with the Asacha project for which Standard Bank is to contribute US$30 million in development funding. Palladex is assigned a SPECULATIVE BUY on the grounds of its pure grassroots potential. The other three companies are HOLDS. Celtic will be reviewed again when the details of the Alrosa deal are announced; political turmoil in Uzbekistan put a question mark against Oxus Gold; and Highland Gold looks fully valued as it pushes every penny towards expanding production.

cheers GF.

Interesting because the Sunday newspapers make Hambro a buy..............

SUNDAY TELEGRAPH
Equity View:
* Worth tucking away Rexam at 419.5p for the long tem - Keep buying Friends Provident at 130.25p - Sell JJB Sports at 183.25p - Worth tucking away Johnston Group at 503.5p - Buy Peter Hambro Mining at 452p - Pipex remains a buy at 8.25p - Avoid Teather & Greenwood at 32p (Look Who's Trading)

AND

THE BUSINESS
Benchmark:
* How Sergey Brin and Larry Page bowled themselves a Googley - Collins Stewart Tullett: the Middleweek affair doesn't end here - Retail sales are still growing at an annualised rate of 6.6%


Inside the Market:
* Technology Investor: Belgacom valuation looks undemanding
* Small-Cap Investor: Turbo Genset shares are still speculative
* AIM Investor: Buy Peter Hambro MiningENDS.

Avocet I think is also a good BUY at the moment.

cheers Gf.

Evolution Beeson Gregory on Avocet.

--------------------------------------------------------------------------------
Latest Broker note on Avocet.........
Avocet Mining (AVM) Buy (unchanged)
Mkt cap: 72m Net cash: 9.5m Trading update Price/Target: 70p/105p

Increased control in Tajikistan
Avocet has increased its shareholding in Tajikistan to 75%. It has managed
this at little or no cost through the forgiveness of a debt owed by the
Tajikistan government acquired in the original purchase for $1.
Avocet has secured an additional 26% of the Zeravshan Gold Company
(ZGC), the operating company for the Tajikistan assets, resulting in a 75%
stake in ZGC. . This has been done in exchange for forgiving a debt of $98m
and is the culmination of protracted negotiation with the government, which
holds the balance of 25%. This will mean the company will go ahead with
$10 million investment program to expand production to 100,000 oz per
annum and decrease costs to below $250/oz.
ZGC is a joint venture company formed in 1994. Prior to Avocets acquisition
the Tajikistan government owned 51 per cent, Nelson Resources 44 per cent
and the International Finance Corporation 5 per cent. The 44% interest is
held by Commonwealth & British Minerals Limited (CBML), which has
operating control. In November 2002 Avocet purchased the entire share
capital of CBML from Nelson Resources for 14 million Avocet shares and
cash of $1.45 million. In March 2003 Avocet purchased the IFCs 5% interest
for $409,500 using CBML as the acquisition vehicle. The two acquisitions
gave Avocet a 49% interest in ZGC plus management control. A nominal
amount of the purchase consideration was for the $98 million loans owed to
CBML by ZGC. This entitled Avocet through CBML to 100 per cent of the
cash flows from the operation. The loans were originally advanced to ZGC
by Nelson Resources to fund the reopening of the Jilau open pit and build a
CIL plant. Since the acquisition Avocet has been negotiating with the
government to swap these loans in exchange for an increased stake in ZGC.
The additional 26% will mean the company adds 970,000 ounces to its
attributable resource inventory and 200,000 ounces to its attributable ore
reserves. It will retain control of the cash flows from the operations until the
additional capital investment is repaid; we estimate this to be around 2011.
This is potentially worth an additional 15 pence per share taking $130 to be
the average the market is currently paying for reserves. The increased
shareholding will increase our projected earnings for this year by 10%.
Avocet plans to go ahead with a $10 million capital investment program,
which was announced at the final results last week but was predicated on
having an increased shareholding. The ZGC operation was brought into
production in 1996 at a rate of 100,000 ounces per annum and at costs of
$200/oz. In the interim a lack of investment in the operation and in
exploration saw grades and recoveries decline. Avocet saw this as an
opportunity since Russian estimates of mineralisation in the area, covering
Increased control by 26% in
Tajikistan
Debt owed by government to
operator forgiven in exchange shares
Increased reserves worth 15p per
share
$10 million capital investment to
increase output and expand reserves.

ZGC is a joint venture company formed in 1994. Prior to Avocets acquisition
the Tajikistan government owned 51 per cent, Nelson Resources 44 per cent
and the International Finance Corporation 5 per cent. The 44% interest is
held by Commonwealth & British Minerals Limited (CBML), which has
operating control. In November 2002 Avocet purchased the entire share
capital of CBML from Nelson Resources for 14 million Avocet shares and
cash of $1.45 million. In March 2003 Avocet purchased the IFCs 5% interest
for $409,500 using CBML as the acquisition vehicle. The two acquisitions
gave Avocet a 49% interest in ZGC plus management control. A nominal
amount of the purchase consideration was for the $98 million loans owed to
CBML by ZGC. This entitled Avocet through CBML to 100 per cent of the
cash flows from the operation. The loans were originally advanced to ZGC
by Nelson Resources to fund the reopening of the Jilau open pit and build a
CIL plant. Since the acquisition Avocet has been negotiating with the
government to swap these loans in exchange for an increased stake in ZGC.
The additional 26% will mean the company adds 970,000 ounces to its
attributable resource inventory and 200,000 ounces to its attributable ore
reserves. It will retain control of the cash flows from the operations until the
additional capital investment is repaid; we estimate this to be around 2011.
This is potentially worth an additional 15 pence per share taking $130 to be
the average the market is currently paying for reserves. The increased
shareholding will increase our projected earnings for this year by 10%.
Avocet plans to go ahead with a $10 million capital investment program,
which was announced at the final results last week but was predicated on
having an increased shareholding. The ZGC operation was brought into
production in 1996 at a rate of 100,000 ounces per annum and at costs of
$200/oz. In the interim a lack of investment in the operation and in
exploration saw grades and recoveries decline.

Avocet has invested $3million to
date on improving the processing facilities at the Jilau operation. The
company has successfully tested dump leaching to mine lower grade ores at
low cost and a significant portion of the new capital investment will see
construction of leach pads to increase throughput and improve recovery.
We believe that the additional investment in Tajikistan will improve output
and unlock the latent value in the Tajikistan assets through increased
exploration and the investigation of the Chore and Taror deposits. We are
holding our target price at 105p
John McGloin +44 (0)20 7071 4387 john.mcgloin@evbg.com EVBG is broker to Avocet Mining

Year end Sales ($m) EBITDA ($m) PTP ($m) EPS (c) PER (x) Yield (%) EV/EBITDA (x) Revised?
Mar 03a 48.5 10.2 3.6 3.03 35 11.3
Mar 04a 68.8 21.3 15.6 12.2 10.4 5.4
Mar 05e 72.7 20.2 15.5 11.5 9.9 5.7

cheers GF.

Pretty impressive update from Peter Hambro Mining......................
Peter Hambro Mining PLC
26 July 2004


Peter Hambro Mining Plc

Trading Update

26 July 2004

Highlights

Peter Hambro Mining Plc ('PHM' or the 'Group') attributable production of
72,541 oz of gold for the first half-year of 2004 is 52% up on the same
period in 2003
The Group is on track to meet its 204,000 oz per annum production target for
2004. Seasonal factors are expected to lead to an increase in production in
the second half of the year
Pokrovskiy Mine production at 60,000 oz of gold for the half year is 26% up
on the first half of 2003
Omchak Joint Venture production of 25,081 oz of gold (50% of which is
attributable to the Group) for this period is ahead of expectations. On the
basis of past experience a higher level of production can be expected in the
second half of the year because of the seasonal character of alluvial
production
The opening of the Pioneer pit, which involved pre-stripping and additional
sampling, has supported the Group's confidence in a high-grade deposit. This
is proposed to be mined on a trial basis from September 2004 and the
previously indicated average grade of 14 g/t is considered achievable. High
grades, including visible gold, were encountered in the vicinity of the
planned starter pit
Operating costs per ounce in the first half of 2004 at Pokrovskiy were reduced
substantially, compared to the previous year, due to a full production rate
being achieved from the Resin-in-Pulp (RIP) plant
The Group raised 40m (before expenses) in equity funding for, among other
purposes, the further development of the PHM's existing and newly acquired
assets. Further discussion on development financing is underway with a number
of Russian and International Banks.

cheers Gf

Coal prices have more than doubled in the last 6 months on a massive demand from china and India and this little Coal Miner market cap circa 11 million and established P/E of 13 forward P/E circa 7 is just going on up and up. It exports a lot of its coal to the mentioned areas and a added bonus is the property and land it owns.



cheers Gf.

to top

GD

Did you say that a tip sheet had a long write-up on Trans-siberian gold,can you post it please, TSG is my 2nd largest holding. cheers. Ald.

aldwickk, will do this evening not that much too it though when Ive had a second look.

cheers GF.

Can anyone explain what is happening to AFE and OXS. I understood that once the rainy season had passed they should be news from AFE which should see its price begin to rise but alas I have heard nothing and it seems that no news is bad news and the price continues to drift south.

OXS is showing a similar trend. Is this drift because of lack of news typical of mining stocks? Any views would be welcome

Cheers

B2B

Thanks GF, at the moment i have slightly more diamond miners then Gold, FDI,AFD and a few NML, do you hold any? whats your view? I have a large investment in FDI which i consider to be one of the best small diamond miners around.

B2B, will likewise get back tonight on AFE. Will give winnie a ring and ask him if he has heard anything. Got to go to the rotten dentists now. See ya later.

cheers GF.

Got the gear lads, please just be patient, nothing critical except me and my gob. That dentist was a butcher and thats for sure.

cheers GF.

The latest news I could find on African Eagle...............

However two releases in three days shows African Eagle* (AFE) is not inactive. The statement concerns the copper deposit Eagle Eye in Zambia where African has drilled 4 of a 34 hold drilling programme planned for this summer. The key phrase reads:

Some of the drill cuttings contain visible copper mineralization and the samples are being shipped for laboratory assay. We will await the results keenly over the coming weeks. In addition to the drilling, our latest geological mapping has revealed copper mineralization in the southern limb of the Mweze fold structure, extending the known strike length of the system from 8 to 10 kilometres.

Ends

Visible mineralisation is encouraging but lets not get carried away. We need to wait a few weeks for the assay results and ideally a few more months for more drill holes to be completed before anyone can really start talking about commercial - let alone World Class - deposits. If however Eagle Eye comes even close to living up to the hopes of its supporters in terms of grades, news that the strike length is 25% greater than previously thought is also very positive.

With both Eagle Eye and Miyabi making good progress and an exciting drilling campaign at both ahead over the summer my stance remains "speculative buy" .

cheers GF

Right extracts from the tip sheet item on Transiberian Gold.

Price at the time was 134p.

Claims gold deposits worth 1.2 billion v market cap of 36million.

Highly speculative tip for value investors.

Latest figure of total mineral approx3.2 million worth circa $1.2 bilion at market prices.

Stupendous figures for such a small company.

Says this is generally a pretty low margin business and a lot depends on POG atany one time.

Director speak - " our gold resources after accounting for production costs are worth circa $25 a share and our present market value considerably understatets that".

$25 is about 13 to 14 at exchange rates against a share price of 134p.

Company has noy yet sold one solitary piece of gold.

Company flush with cash but this will be used for exploration and development.

Ultra high risk tip.

Were in Russia so that can have problems.

Speculative Buy. ENDS.


Wont give the tip sheet but it is a specialist one for value investors.


Sounds very promising, might have a few bob on these further down the track.

cheers GF.

Many thanks for your efforts GF.

Much appreciated.

B2B

Many thanks GF

Bisichi up another 4p today. Good stuff.

cheers GF.

Gf
Re post 13. How recent is this news please as I haven't seen anything from AFE since 24 June?
Regards

http://www.africaneagle.co.uk/news-85.html

This is what I had in mind