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.

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 .

thank you parkin.

Excellent write up in Shares which will keep the momentum going for some while, meantime any more good news should again boost the price. Target 2 retained

thats Di & rStuff at 2!!
nice targets guys - once again..... hope youre right

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...