Anglo Asian Mining Share Discussion Threads

[mattjos] 18/4/2017 17:39

the huge quantity of stockpiled ore, enabling them to keep producing for the next 6 months without mining, is surely symptomatic of the company having planned this for some time.
you don't just take the mining cost on the chin & then put aside 1m tonnes of ore for the sake of it.

[zhockey] 18/4/2017 16:49

Cyber, just take a look at Venezuela, it doesn't work as an economic model and Azerbaijan want to encourage outside investment not snuff it out.

[cyberbub] 18/4/2017 16:28

Or if they just ignore the AIM regulations, because they know that the FSA rarely takes action against UK law breakers, much less foreigners...I don't understand the point about naionalisation/privatisation above. If a government is desperate for money why wouldn't it nationalise a mine which is throwing off millions in cash flow every year? Free money! Even if they had to pay a measly 25p a share in compensation, they would get that back in the first couple of years of operation. And the current board would get well paid positions in the new state-owned mine, plus a percentage of the revenue in some non-transparent manner...Sorry to sound cynical, and perhaps the AAZ management are above such underhand dealings, but an awful lot of AIM companies aren't....Just challenging here, I am genuinely not trying to deramp, it's just a concern I have in this particular country. Good relations with the government is certainly positive, but when it goes from 'good' to 'cosy' is when you might have a problem.No advice intended etc etc

[zhockey] 18/4/2017 15:48

Not if they are spread across a number of distributed accounts.

[jeanesy] 18/4/2017 15:36

If someone where buying a stake we would have heard by now as an RNS on holdings would have been published

[catsick] 18/4/2017 15:09

We are talking about a 20 mio pound market cap company here, totally irrelevant to the government apart from its a solid provider of decent jobs, the shares may be being accumulated by an individual or small fund but there is nothing surreptitious going on, its just too small a company, The oil industry is 100's of times bigger in Azerbaijan than a few small mines scratching to find some decent ore ...

[jbravo2] 18/4/2017 14:26

Ah yes thanks cannon. I'd always been looking for an expanse water but of course it was under construction back then.



You're right in some respects ferries.
They are indeed offering up a variety of companies for sale in Azerbaijan. That includes mines. They were trying to sell an iron ore mine for the third time of asking only last month.

The mines taken under AzrGold are of course a notable exception. They were privately held (by a "complicated web of companies") but bought by a "government entity" in AzrGold.
Now everyone knows why this happened but the interesting question is just how much of AzrGold is govt owned?
Its a CJSC so we're not likely to find out anytime soon. Indeed all official announcements have said all 2m shares are govt controlled but who would be surprised if they weren't?

Things we know:
It's quite expensive to build treatment plants (as AAZ have found out).
Chovdar has sulphide ore and they're trying to work out the best way of treating it.
Chovdar, Gedabek and Qaradag (an early stage AG property) are all within trucking distance of each other
AAZ has a good relationship with the govt of Azerbaijan

Things we might presume:
Reza would sell at some price.
If someone wanted to buy but thought that Reza's price was too much to pay they could buy some of the company beforehand at a price far below that level, reducing overall cost or of course making a few bucks for themselves.
The financial market involved is largely powerless to stop something like that happening. They couldn't even ensure correct RNS's as bash sold down his 20%


cyber:
Having medium to heavy weight political allies and shareholders in the Snunu family means that is a course of action that is unlikely, never mind the fact that Reza also gets on well with the powers that be. Granted, unlikely, not impossible

[mattjos] 18/4/2017 14:10

still evidence of a reasonable buyer in the auctions at 20p

[zhockey] 18/4/2017 14:07

Governments hungry for money do not nationalise, they privatise!

[cyberbub] 18/4/2017 14:06

So you're thinking that the Az Govt is buying a big stake on the sly, so that they can then cash in if the company is sold at a higher price? And they aren't declaring their holdings because they are based outside the UK and know the FSA cannot reach them?If a public body is willing to engage in that sort of behaviour, surely they will suddenly declare their hand when they have 29% and launch a takeover at say 25p or 30p, not £1?? Get a cash cow on the cheap.

[jbe81] 18/4/2017 13:58

Cannfodd3r, May 10th is when we may find out whats will happen with Chovdar

[ferries5] 18/4/2017 13:52

cyberbub

The opposite is happening, desperate for money they may be, but there are over 500 Government companies up for privation in Azerbaijan. Not saying AAZ will be one though.

[cannonfodd3r] 18/4/2017 13:51

Cyber, that would be my thoughts, but they will have to make an open market offer if they were to buy it. I may be totally wrong but if aaz were to run Chovdar I'd have expected to hear something by now

[cyberbub] 18/4/2017 13:32

I have held AAZ stock on and off, but one thing that has always made me nervous is the 'eminence grise' of an authoritarian government desperate for money, and what it might do eg. nationalisation without compensation.

[cyberbub] 18/4/2017 13:30

Cannon fodder, when you say "it's pretty clear who is buying a stake", can you clarify? You mean a government- linked entity?

[cannonfodd3r] 18/4/2017 13:08

Look directly east from the mine and you will see a big scar running north south, thats the tailings dam. I believe Ugur is about the same distance away from the leach pads as the current open pit is, but to the NW, however dont hold me to that. Looks like the google satellite images are from 2012 too so wont have the new plant etc on.

Also if you rotate and look in 3D you can see the pit and the overburden i keep speaking of. I reckon they are at a point where there is just too much overburden to remove (look at difference in rock colour) to enable them to get enough out so need to take a step back and pause for breathy which they are doing. Photos seem to show it has a pretty steep face so there is probably 20-30 loads of overburden to 1 load of ore now, so its not like its not there its just that its not that easy to get to.

As gedir has been said to be on the estate and doesnt yield much you can bet Stepehen Westhead is thinking mine under it. They have the kit there paid for and its not doing much in the Gedir mine it seems. This is exactly what the Siemens brothers did if you look into the history of the mine. It could even be that the stockpiled ore is on top of easier to get to ore, however i think its great they recognise the issue, find alternative resources to go on with, think about best solution to get the ore from the pit and then hit the main areas so grades will increase while carrying on looking for more reserves. Look at the map and you will see how much potential the area holds

[el_duderino_7885] 18/4/2017 12:46

Good point Mattjos.

The company must have models that have convinced them to make this move. It will take some time for them to make the resource compliant but it's a massive vote of confidence isn't it.

[jbravo2] 18/4/2017 12:32

@cannon.... I've never worked out where the tailings dam is. Can you hep pls?

[mattjos] 18/4/2017 12:31

This decision to move & get Ugur into production will not have been made just on exploration results RNS'd to the market to date.Stephen Westhead will be driving this and the decision will be data based.

[zhockey] 18/4/2017 12:30

Yes but drilling takes time and so does the analysis. Not expecting any significant news in the next six months.

[el_duderino_7885] 18/4/2017 12:23

Zhockey depends on how aggressive they are with their exploration. If they have any sense they'll be putting every cent into it even if it means less debt is paid off this year IMO.


The value is all there.

[el_duderino_7885] 18/4/2017 12:21

Still not bought back in but I will be soon.

Really liked the detail in the update and the company seem to have a sound plan in place for addressing the current issues.

The new open pit will be a fantastic addition as more resources are proved and with a higher gold price offsetting the lower production somewhat,i'm confident that plenty of cashflow will go in to exploration this year.

Should be a fantastic platform for much bigger and better things.

[zhockey] 18/4/2017 12:16

I wonder if this drift back now as it could be a quiet period. I suspect this will now follow the price of gold until news on Ugur potential is released and that could not be for 6 months or more.

[jbravo2] 18/4/2017 12:15

If I could vote that up ten times I would.

[cannonfodd3r] 18/4/2017 12:09

I think that people need to remember that Gedebek, Ugur and Gadir are all basically one asset on the same mine site. These deposits arent miles away just literally around the leach pads. Its long been said that the whole mine and in fact town is sat on gold/copper/silver rich ore, its just a case of getting on with deciding what is best to mine, which they are doing. I think sometimes people forget thats its all one site with different names for different operations, however its all one ore body in reality. Have a look on Google Earth at the place. The tailings dam and Gosha are the only remote operations.

I think its pretty clear who is buying up stock. There is a lot of value in the company, be it current operation, knowledge, assets (and there is a few it has the rights to) and i suspect the stock is being bought up so that Reza can sell a big stake and they still have a controlling hold. This could push the price up to well over £1 as people start to realise this.