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.

016622...I have that feeling that I had for PDX and SEO that they were going to double my money lots of times and I was right then and have moved on to GFM, KMR which I have had over 2 years...my only share of my 'superduper double your money potential shares' not to perform is NML..maybe I will be wrong it has to happen sometime but with GFM I don't think so...2 is my target.
Di

Di'

Have you locked in any profit yet ? i sold some at 47.5p .

No streaming prices for GFM.

Its early days for GFM and I respect Shares for calling it good more often than not. The graphs also look very good (if you believe in that stuff) with 60p next check point.

sorry to butt in Aldwick but the subject interests me.
Always tempting when youre looking at a decent profit but I've always lived to regret it. I find that a decent trailing stop loss suits my blood pressure much better but I suppose its "horses for courses".
So GFM has risen 50% since I bought in and I hold a 20% trailing stop. I find that you dont sell too early then, cos once youre out (or part out) its always tempting to get back in, that then being the problem of when to get in again!?

Your thoughts would be of interest to an amature investor!

016622 your investment strategy is the most recommended method and as you say its very tempting to take a profit, especially when others in the portfolio are not doing so well. Many say run your winners and dump your losers. This is a winner right now and the potential is great so I'll be running this one for now.

likewise... and I'm excited by yours and Di's 2 target
Happy Weekend...

Aldwickk I see no reason to cash in any profits on GFM yet...the game is only just beginning...there is so much up side and GFM now has what it didn't before; the 'X' factor in all but name (pdX, jkX) No one wanted to know GFM a few weeks ago, like SEO in Dec last year (although SEO has lost it for the moment) but now GFM has the interest and you watch it fly!
Di

agreed, hasn't started yet.

I have jumped in this morning after reading Shares. Was going to buy earlier in the week as a friend in the city said this one will double. Wish I had had the guts earlier and not hesitated but still a long way off 90p so fingers crossed.

2 target.....? Based on what exactly. Current production doesn't justify that. 016622. Don't act on everything you read on BB's. Most poeple live in dream land.

bingobingham,
2 target means exactly that, a potential future sp based on increased production, a steadily growing cashpile & possible future resource finds.
All of which look very likely.imo.

Current production? of course not, it would be 2 wouldn't it. Buying shares is about future prospects DYOR.

Exactly so...bing that is like saying PDX at 258 is worth the production of the 3-4 pumps sold so far! 2 is my target because of future potential.
Di

GFM was over 40% of my portfolio by locking in some profit i have reduced it to 30% with my last sell this morning at 50.42p bid, my holding is now up 67%.

Aldwickk I don't say you shouldn't lock in...only that I am prepared to play what is essentially a more dangerous game because that I see more upside than risk in GFM. Currently 43% of my portfolio is GFM because of profits...this is no different to earlier in the year when it was SEO that had half my portfolio. Once I got worried I locked in..I'm not worried about GFM yet..far far from it.
However, DYOR it is all down to your own personal view. Any profit is good :-)
Di

GFM said that they were thinking of buying shares in the market to get the price up to 50p because of fears of a bid , if they have been doing that , that surport may not be there now and the price my drift down untill the gold results are known but with the good press we have been having and the number of new investers it should reach 60 to 70p before that.

Once we hit 100m m/cap, one or two tracker funds will have to buy in if my memory serves me right!!!!!!!

Aldwick
If GFM were buying shares I am sure they would have to report it to the market. This looks like good press sending GFM north.

GFM is now only starting to do what I originally hoped when I started this particular thread in June. Shares mag. took loads of prompting to become interested in it but it is good to know that at last they appreciate what GFM are about. Anyone in the gold mining field will back up the comment that the gold results referred to so far could represent a very profitable ore deposit. GFM's mgt. are right to be cautious (why change their style?) before getting independent assay results. These are hard to come by as there is a shortage of facilities. I am certain GFM's mgt. know what they have in prospect. I doubt that they have been in the mkt buying in shares.
As for targets, the Ch. always reckoned the zinc production alone would justify an sp of 100p. That looks likely as production is increased. AS for the gold, I shouldn't think we will have to wait beyond the next 3 months to see what that adds.