Griffin Mining - golden future! http://www.basemetals.com/

GFM deserves a new thread after todays AGM. For the first time the venue was packed with shareholders, a tribute to the interest and support the company has for what the Board has achieved. For those unable to be at the meeting here are some of the points I noted which may interest folk on this BB.

Production: dry and wet testing now completed and zinc concentrate comes through the smelter next week. Zinc price on the LME is currently $1300/ton. GFM is being offered $1700/ton at the mine gate. This premium reflects the demand and difficulty local industry has in sourcing this basic metal ( As an aside the chairman reported that zinc is not easily and efficiently extracted as a recycled metal so newly mined zinc is always required). Cost of production is $595/ton ($700/ton if all depreciation costs are included). Labour costs are $1000/worker pa cf an Aussie underground worker of $130,000/worker pa. Apparently the 20m.pa worker migration from agricultural to industrial jobs means that there are queues of applicants wanting jobs at the mine; wage inflation is not an issue. 240+ employees on site to run the mine on a 24/7 basis.
Production can be increased w/o further investment for a throughput of 400,000 tons of ore pa; An increase to 500,000tons pa would require further investment of between $1m and $2m . All plant has been purposely over-engineered to ensure capacity can rise reliably and with back-up facilities (eg 3 boilers, 2 of which are back-up)
H&S is to world stds., setting an example to the rest of the Chinese mining industry which has a poor record currently because of the number of small private mines.

Reserves: 14.5years supply on current zone rising to 25 years in zone 3. Chairman showed an independent report which believes that the closure of many existing zinc mines is now producing a supply gap which will continue to improve the zinc price cycle to year 2012.

Profits: No problems known or foreseen to the repatriation of profits. However the chairman stated that the profits might achieve more for shareholders if the company uses these for further exploration and possibly buying back the companys shares. The latter move might help resolve the current shorting problem where it is thought that between 6 or 7 million shares are currently being shorted. This move could have a highly geared effect on increasing the share price and help deter the shorters/stock bashers from further activity.

Exploration: Chairman says company will be drilling a further 18,000m over the coming summer months and in his personal view he expects the company to steadily move towards becoming a gold mining concern, with some of the profits from the zinc smelting funding that work. An RC rig which costs 33% of the cost of a diamond drilling rig has been brought on to site.
Future exploration areas always being looked at + changes in Chinese Ministry of Land & Resources policy towards funding means that GFM will likely be offered many more prime government held assets in the near future.

Personal view is that GFM is a well and responsibly run mining company which is now likely to really grab a lot more attention as the profits start to flow as of next week. I am sure others on this BB at the meeting can fill the gaps where I have missed anything.

22.7m @ 8.36g/t!!!
GOLD...

Griffin Mining Ld
27 September 2005

GRIFFIN MINING LIMITED
60 St James's Street, London SW1A 1LE, United Kingdom
Telephone: + 44 (0)20 7629 7772 Facsimile: + 44 (0)20 7629 7773
E mail:
griffin@griffinmining.com

27th September 2005


UNDERGROUND GOLD DRILLING RESULTS

PRACTICAL COMPLETION OF CAIJIAYING MINE AND PROCESSING PLANT

PRODUCTION UPGRADE STUDY COMMISSIONED

Griffin Mining Limited ('Griffin'or 'the Company') is pleased to announce that a
further exciting gold intersection has been obtained from the underground
drilling program at its Caijiaying mine in China, and that the Company has
commissioned a study to investigate upgrading production at Caijiaying.

Underground Gold Drilling Results

The Company is pleased to announce a further high grade intersection in one
drill hole of:

22.7 metres at 8.36 grams per tonne;
3.5 metres at 4.56 grams per tonne: and
3.9 metres at 5.28 grams per tonne.

This follows the previous announcement by the Company of significant gold
intercepts in one of the underground drill holes of:

8.8 metres at 19.2 grams per tonne; and
6.2 metres at 14.2 grams per tonne.

The latest drill hole is located at the southern end of Zone III at Caijiaying
some 210 metres south of the previous intersection mentioned above. Both
intersections occur at a similar level with few drill holes between them.
Further infill drilling will be undertaken to define the ore reserves in this
area of the mine.

RC Drilling

The reverse circulation ('RC') drilling programme from surface at Caijiaying is
progressing well with approximately 75% of the planned programme completed. Due
to the current lack of capacity in the support services for the mining industry,
assay results have been severely delayed with no meaningful results having yet
been received. The Company will release such results as soon as they become
available.

Practical Completion of Caijiaying Mine and Processing Plant

The Caijiaying mine and processing plant has now reached practical completion
less than 3 months after production began in June of this year. The mine has
been consistently producing ore in excess of the required rate of 3,850 tonnes
per week in the past month. The process plant has now been fully commissioned
for zinc production and has achieved its design specification level with respect
to the recovery rate (92%) and initial production of 45.4 tonnes per day. The
feasibility study head grade of over 10% zinc is now being fed into the mill. As
at the end of August over 50,000 tonnes of ore have been accumulated at surface
in stockpiles ready for processing. With the zinc circuit fully operational, the
gold circuit is now being prepared for commissioning.

Production Upgrade Study Commissioned

With the exceptional mining and production results obtained to date, the Company
has commissioned the relevant studies with a view to upgrading production at
Caijiaying by the summer of next year.

Griffin Mining Chairman Mladen Ninkov commented:

'Caijiaying continues to provide ample evidence that the long term view held by
the Company that Caijiaying will develop into a long term, highly profitable,
world class ore body and mining operation is valid and continues to strengthen
with each passing day. This is a continuing just reward for the loyal
shareholders of the Company.'

Further information

Mladen Ninkov - Chairman Telephone: +44(0)20 7629 7772
Roger Goodwin - Finance Director
Griffin Mining Limited

Andrew Smith/Martin Eales Telephone:+44(0)20 7523 8350
Collins Stewart Limited

Hugo de Salis Telephone: +44(0) 20 7242 4477
St Brides Media & Finance Ltd




Griffin Mining Limited's shares are quoted on the Alternative Investment Market
(AIM) of the London Stock Exchange (symbol GFM).

The Company's news releases are available on the Company's web site:

www.griffinmining.com

Good result, this mine could prove very exciting indeed.

Agreed but why has it not taken off this morning

Oakapples-probably a bit of buy on rumour sell on news...the rumour was in the papers yesterday...GFM probably will carry on going up over the next few days/weeks IMHO...the upside of this company is huge.

It as taken off, you have got to expect some early profit taking.

Oakapples, good question. Mining gold at 1g/ton in a low wage economy like China has, would probably be profitable. Raising any cash for a larger gold processing plant would not be difficult at a premium (even if that was necessary given the zinc cashflows). Perhaps it just takes time for the market to do the calculations!

Dynamite,
Are you still talking to your friend who tipped you NML ?

Aldwickk...you are right...don't forget everyone; many people are not investing in GFM, merely trading it. They make a good profit and get out and look for another opportunity. Lots of us here are in GFM for the long terrm for bigger and better gains but at times GFM is going to temporarily go down or sit still. That is all part of long term investing but with GFM it is a lovely upward path.
Di

I Prefer Steady as it goes, to being too volatile. The sp should carry on it's upward trend, it's still early days and the prospects are good. Also, plenty of possibility for the press/share mag articles to boost it up, targets to be raised over the next few weeks.

making a fair assault on your 2 target Di!

Expect profit taking at 50p.

Maybe, Aldwickk. The difficulty from now until an updated resources statement is compiled (and that might take 3 months) is assessing the value of today's drilling update. That interim period leaves the company in a vulnerable position to someone making an opportunistic bid for it at a time when it might be impossible for the mgt. to say anything other than 'give us the benefit of the doubt when we say that there is huge potential'. It all bodes well for an interesting last quarter of 2005.

Zinc production will surely justify present price while waiting for gold an added bonus....it took a long time coming but gfm is begining to look like a long term hold.

Holding up well today considering the recent rush...
I wonder how long the drilling results will be delayed?

No news on Griffin for a few weeks now. I wonder how the exploration prog is going.

drilling results could be announced any time now which should keep the price testing the 50p level.

Thats what I thought, although delayed due to busy labs, they could come at any time.
I keep feeling tempted to trade a little but I'd hate to miss further news even with a small % of my holding.
Also, its good to see how many trades are going thru over 48p.

dibbles, even if the further drilling news doesn't come for a while there is always the risk of a leak or even a bid sending up the price. I agree that there is no dealing evidence to suggest stake building but about 50% of GFM is owned by institutions which may have different priorities. Also there are some assay facilities on site so once they are staffed that might speed things up.
One thing I am curious about is that none of yesterday's gold results (which were good) were as high as a result I believe they achieved on one of their very early drillings. Puzzled as to why that hasn't been included at this stage.

A buy statement by in copy of Shares Mag. today which reads
China based Griffin has struck gold again @ its Caijaying mine not far from Beijing.A single drill holes shows 3 strikes - 3.5mtrs & 3.9 mtrs & 22.7 mtrs down - & the Co. is wisely going to investigate upgrade its investment in the mine.This latest develoment could trigger significant upgrades to likley gold quantities underfoot.
Meanwhile,zinc production has started & its first sales to Chinese smelters were completed in July.The shares have jumped 35% so far after our original tip back in july21 but this could be just the start .