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.

Silvermede - post 856... Thats the spirit, a great time to top up or buy in. Re-mortgage your house and chuck the lot in.....

explosive, remortgage? never! this is speculation not investment and if people don't know the difference they shouldn't be buying shares. Not trying to ramp at all. My comment was made because the Sp had fallen to around the level of previous support appears to be turning and the RSI and the slow stochastic look to be moving in a positive direction as well. Either way I like the this share and am in for the long term, provided all the indicators remain positive e.g. demand for and price of Zinc etc. More than happy for you to keep me in check though :)

Does anyone else think that Shares magazine has never really understood GFM? It was slow to get in on it, and now quicker to suggest moving on, albeit with a comment that GFM still has plenty of potential. The editorial staff on the magazine are an odd bunch sometimes!!!

Sharesure:
Why are surprised at attitude of Shares mag? Sometimes they are allowed to behave like stock market gamblers, surely - that's what they are! If a stock, however interestin, speculative, intriguing, if it doesn't do anything for a while, despite making sign gains previously, they move on. Most have the attention span of a flea, surely. Personally I agree with you, the stock is a little more than pure speculation.

Sharesure:
Why are surprised at attitude of Shares mag? Sometimes they are allowed to behave like stock market gamblers, surely - that's what they are! If a stock, however interestin, speculative, intriguing, if it doesn't do anything for a while, despite making sign gains previously, they move on. Most have the attention span of a flea, surely. Personally I agree with you, the stock is a little more than pure speculation.

Hello all

I dipped my toe in the water today with a 20k buy. I will be paying for them and keeping them until the bull run in commodities is over in about 2015.

Alfred

Not got long to go then its 15:22 already.

Silvermead - Thanks for your post 859, I agree...

TheFrenchConnection - post 854 "Zinc is virtually unrecyclable." Now when I first read this in your post 854 I was unaware if this statement was indeed true. On further investigation if would seam zinc is recyclable and has been recycled for decades as per below link.

http://www.zinc.org/publications/recycledforever.html

Now either your post is incorrect on this matter or I'm missing something. Can anyone clarify??

The last update from shares mag was all to play for and lots more to come?

Amazing turnabout by them although to be fair they do still state positive for long-termers!!!!!!!!!

Explosive, It is generally reckonned that there are many practical and economic reasons why zinc is not capable of being economically recycled - unless of course the price rockets - at which point maybe some of the drawbacks will be overcome.
Dibbles, Shares mag. also suggested locking in some profits - not advice I would follow on GFM at this stage as I have come to doubt how good some of their current team are.

Recycled zinc, thats what ZOX does.

ZincOx Resources plc is pleased to announce the completion of the first part of
the feasibility study for the Aliaga Recycling Project (Turkey) being undertaken
by SNC- Lavalin Europe. The work to date has included a technical review of the
process, plant layout, engineering design and an estimation of capital and
operating costs to an accuracy of +/-15%.

The Aliaga project envisages the production of high quality zinc oxide from
waste material (EAFD) generated by the steel recycling industry.

aldwickk - that's interesting. My comment arose from a conversation with the chairman of GFM at the last AGM. I'll have that discussion with him again. Do you know ZOX's operating costs/tonne?

Sharesure - thanks for your post however I'll look further into this and come back to the bb...

Aldwickk - Any others companies like ZOX to your knowledge?

http://www.galvanizeit.org/showContent,299,343.cfm

Amities / When i stated the fact that ZINC is virtually unreyclable. That is perfectly true.And the volatility in zinc on the futures exchange backs me out . Prohibitive costs make the long laborious process economically unviable.( unike a number of metals like copper or gold which are cheap and easy to seperate} Recycled zinc makes up for no more than 2% annualized production. !! Perhaps you understnd my meaning better now when i use the words "Virtually lmpossible" to recyclable.. ...RE; VOX ,-l have known the attraction to this stock for ages; as it was i who reckied it to Aldwick a while back . ....Lets get it right here. @+ J.....

As for GFM i have held these since those heady days of the "hi tec" , dot com bubble . Tip- Source-a man in a bar,,,blah blah ,, ,,,, They were a mere 2p and what with mines out of favour with institutions but very much in favour at govermment level i bought 500,000 ...Sounds a lot NOW ! But was 10k plus expenses back in 2000 ,,,or so if my memory serves me right .....went to 16 ,,,,,,went back to 2p ,,,,,,,,( gets worse ! ) Then zooms up to 29/22p and then back down to 15/16p ,,,,,,Slowly climbs back to 30,,,and the mention of that damned word "GOLD" and the whole trading community and his dog is buying it . ...Dont get me wrong i was buying again at 57p last week .,,,,,,Dont forget ,China is short on certain commodoties . But contrary to my data overcapacity exists in Steel ,Aliminium ,Coke, Calcium Carbide ,Cement , Coal and cross sector to even Textiles ...BUT China is desperately short of zinc which gives steel its tenstile strength ,,,Zinc is not mined quickly . and whatever anyone tells you that exists warehousefuls of the stuff in Rotterdam they are lying . lf anything zinc is underpriced !! ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,All the volatility was quite understandable ; and not assisted by thier early attempts at web design ..lol What a joke ! A man standing in a field pointing at a muddy hole about six meters deep ..lol LOL ,,,,We have come a LONG way since then . . As time passed and pre requisite infrastructures appeared until it bagan to on the appearance of a" new generation" of "hi tec mine " ( and with spares of every moving piece of moving machinery and the s/p consolidated in the mid 30s awaiting a rerating from an expo to a producer ...,,,,,,,,,,,,,,,,,,,,,,,,,,,,Theses a ighly specialist mining book out there, costs 32 grand, and when you purchase it ,you have to "sign" you will not pass any informations by whatever media to any third parties . And i agree . Why should something that cost someone 32k be passed around the internet willy nilley ,,,,But back to GFM ... l dont think a holding would be regretted. .Juste a hunch ,@+ J

Amities / lf zinc even falls below 2000 this year i will drop my boxers on the steps of The Royal court of Justice ,,,,,,,( better class of judge than those common ones found at the old bailey ,,,,,@+ J ...............Also among the drilling assayal while all eager eyes were on the gold and zinc ,,,But what of the silver ? Chinas mass exportation of "hi tec" gadgets to USA and Europe is virtually based on the stuff . For every database in every day devices use silver as choice of weld........and this mine has as much as 100g/pt in long pockets interspersed but gives the impression that large parts of the acreage are host to a number of minerals including a deposit of silver ....@J .

Trading statement makes good reading as far as zinc production is concerned. GFM looks set to increase still further its profitability. As for more information on the gold assays, that must be the subject of another RNS some time soon.

That's the news we needed! Upward and onwards now....