http://moneyam.uk-wire.com/cgi-bin/articles/20050126070000PE650.html

From the press report below it would appear PAF are looking to extract 1,000,000 ounces of gold from each of the Ghana and Mozambique projects so my previous figure of $422 million should have been $844 million less the extraction costs. Would be grateful if anyone in the know could provide an indicative figure for extraction costs at these depths.

Article from GhanaWeb.com - 26th Jan 05(http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=74148)

Pan African upbeat on drilling results from Wa Gold Project
LONDON (AFX) - Pan African Resources PLC provided an upbeat assessment on drilling results at the Wa Gold Project in Ghana.

The company is undertaking a 6,000 metre drilling programme at the project, which is designed to further test the known gold mineralization of the Julie Prospect, and has so far drilled 1,709 metres.

"These results confirm the attractiveness of our prospects in Ghana where we have seen some significant intersections of high grade mineralization" said managing director Roger Craddock.

The current drill programme will also further test the potential of the highly prospective Collette Prospect, it said.

"Our next step will be to process results from Mozambique and further results from Ghana before we are able to better determine the increase in our assets but I am most encouraged by what we have seen so far," said Craddock.

The company's targets in Ghana and Mozambique could each produce a resource in excess of 1 mln ounces of gold, the company said.

Pan African said it is also looking at the acquisition of a number of new gold projects.

From what I can find on the internet it would appear that the total costs for extraction vary from $190 to $300 per ounce. With possible reserves of 2,000,000 ounces of gold it would appear there is potential to earn $844 million, (based on $422/ounce) less $600 million in extraction costs leaving a resource of $244 million.

If we take a Dollar exchange rate of $1.90/pound that works out to 128 million GBP.

If you split that between the 352 million shares in issue, your looking at 36 pence per share. This is a pretty crude look at the potential figures but at 3p these look cheep as a speculative punt.

Would appreciate some other views on this.

Edit

Nice flow of buys gone through over the last couple of days, lets hope we see another move upwards soon.

Average volume today but almost all on the buy side once again.

Looking forward to another good week for PAF!!

Does anyone know who John Drinkwater is ? He has upped his stake steadily over the last few weeks. Thanks.

Appears to be a private investor with a big holding. Done a couple of searches over the past week to find who he is but come up with nothing to date.

Thanks for that. I looked could not find anything about Mr Drinkwater. I hope he keeps buying.

He has a big holding and it makes you wonder what he knows to make him so confident about the company. It would be nice to get some news flow going soon so we can start to see the SP really take off.

There is not much mentioned about PAF on other boards. There website is not very informative. However going off there recent announcements i think they are very good prospect ( no pun intended ).

Have also looked for Mr Drinkwater again - nothing.

Any contributions welcome on this company

The lack of news and awareness of PAF is one of the items that attracted me to this share. It has great prospects for the near and long term future and yet the SP is comparatively low to other mining companies. I'm pretty confident that once the news starts to flow with regard to the drilling results and they get a few mentions in the mags and papers the SP will move up at a fair pace.

Meanwhile, it's a case of being patient and just waiting for it to happen, because when it does, the rewards should well worth it!!

IMHO DYOR

Another large buy went through again today, I wonder if Mr Drinkwater is still adding to his holding?

Maybe. PAF year end is March. So perhaps they make an announcement re new mines etc and that Drinkwater is building his stake to make a killing then.

The results should be interesting, good potential to see the SP move upwards as we get closer to them and an update on drilling and new mines would be great.

Very quiet day for trading today!

All very quiet buts its not a high profile share. Hopefully it will be !!

Agreed frenchpark8, seen a few more shares changing hands over the last few days which has been good to see. Interesting to see what happens over the next few weeks as we move closer to the results.

Huge order went through this morning, surprised the SP has not moved up since that one!

About time this moved up again with the volume of large buys going through. Lets hope it continues to move up as we move towards the results.