Anglo Asian Mining Share Discussion Threads

[mattjos] 15/9/2017 21:46

For me, It's what lies in wait for us, at depth, under the open pit at Gedabek & in the down-dip extension that really fascinates & intrigues me. I believe Gadir has given us a clue, albeit that shows mainly narrow veins of gold.

I've lost track of the number of scientific, volcanic & geology reports I have unearthed & read as to the possibilities over the last 8 years.

If, as is commonplace, during the pressure & high temperatures of the volcanic upwelling, some liquids (rich in gold) were forced out of the main Gedabek ore-body, they would have naturally travelled along fissures and fractures in the rock.
This would now be revealed in high-grade & narrow vein deposits according to where those fractures lines existed at the time.

This is exactly the geology that Gadir has very clearly proven .. 1km away from the Gedabek open-pit. Might seem like a long distance now but, during the formation conditions, the pressures and temperatures would have been absolutely incredible.

The company has intersected these veins (following into the Russian & Azeri artisanal tunnelling) and exploited them for the last 2 years ... all the time they have been working towards the Gedabek main ore-body. That is clearly a sensible strategy .. follow the breadcrumbs, so to speak.

Now, we are close enough to tunnel under the main pit and get an initial view as the what lies down-dip!
To date, all we have done at Gedabek is scratch away the Oxide cap and got to the top of the Sulphide ore.
During formation, the closer to the surface the quicker the up-thrust liquids would have cooled. This, effectively, is akin to screwing down the top of a pressure cooker .. beneath that cooler, solidified top, the pressure and temperature enables the liquids to contain a much higher % concentration in solution of metals from the deep volcanic upwelling.

When this 'capped' liquid solution finally starts the slow cooling process, the higher metals content in solution consequently solidifies into much higher grading ore with larger particle size.

(If you remember growing salt crystals at school during Physics & Chemistry .. you heat the water and keep adding the salt into the liquid and then, with a slim substrate in place, you let it cool and watch your monster salt crystal form as the salt precipitates out of the liquids, due to the cooling & evaporating water being unable to hold as great a concentration solution).

To date, everything revealed by the company about Gadir looks very, very promising.

Right now we stand on the brink, so to speak .. we've followed the breadcrumbs & arrived at the top of the down-dip source.

The planned 2018 fan drilling programme under Gedabek is, in my opinion, effectively the heads-up for what will later prove to be the start of the significantly upgraded JORC for Gedabek.

Once the tunnel from Gadir under Gedabek pit is complete and we get the first exploratory horizontal drill results into the 'main' (Gold rich) Gedabek down-dipping ore-body ... this is what, I believe, is going to lift the roof on the company valuation.

Bittibulag, Ugur, Gosha & all the others assets we have ... they are the rich icing on the top :-)

Really very, very short time to wait now as the tunnel from Gadir to the Gedabek down dip extension is due to be completed by early September!
What will be revealed??? :-) After 8 years, I can wait a little longer

[celeritas] 15/9/2017 21:18

If only every thread was like this on advfn, would make it a great site.

[friendzarin] 15/9/2017 20:18

Just re-reading the board tonight.

As well as Matt and JB great posts today 2sporrans and Bleepy. What a quality board you have organised Matt..well done.

Looking forward to next week and Bill's appearance at PI although appreciate 3Q figures may well be the catalyst to pin back the ears.

Good weekend all.

[mattjos] 15/9/2017 20:03

Here's my suggestion for the weekend.I believe this company will soon be valued at over £100m & I feel comfortable with that as a minimum target given the valuation afforded by Behre Dolbear all those years ago (on much, much lower metal prices and far worse £:$ exchange rate than now).When that happens, we will take out the previous 80p high, which should then become strong support in the future' albeit I would expect it will be a bit of a battle to go past 80p.For that to happen, what do folk put forward as the 'value kickers' or catalysts to get there ... let's have it put in the open what folk are waiting to hear about to take that leap forward, please.

[jeanesy] 15/9/2017 19:59

A great week here !! Must be nearly time for that meet up of you Derbyshire folks .. wasn't it 34 p?

[graylyn1] 15/9/2017 19:43

Great little company, and a great message board here with some very well educated and informed investors, pleasant reading without idiots trashing the board.
thanks all.
have a nice week end, interim results Monday??

[jbravo2] 15/9/2017 17:58

lol snap.

Great minds...
Fools seldom...

[jbravo2] 15/9/2017 17:56

@punto.
Its probably not a sell.
Look at the date of the trade.
Its timed to 11am on 13/9. It is very likely the buy that started the surge. First few trades on 13th were around 27p mark. Its likely this started it all.

Either way, as wrighty would say, its all in now. Whether it was a sell or a buy the price still ended up 5p on the week

[mattjos] 15/9/2017 17:56

punto .. that 250k trade was stamped as follows:

11:00:35 13-SEP-17 250,000 @ 29.75

At that time it was Bid: 28.5 v 29.5 Offer

It came 16 seconds after the 11am Auction Uncrossed at 29.75 with a 20,000 trade.

I would suggest it was actually a buy but, obviously late reported as significantly above normal market size.

[mattjos] 15/9/2017 17:43

well, a good end to the week and not too many folk cashing up for beer money at the weekend. What was sold, looks to have been taken on by buyers.

Great to welcome several new investors over the course of the last two weeks .. welcome to all.
It's been a very long time coming but, since Bashirov finally coughed up the rump of his stock nearly two years ago, the share price has been on a rising trajectory.
The company has far from stood still!! Pretty much ever since the first gold pour at Gedabek, which gave them that first precious cash-flow, the whole team & operation has continued to grow in size, capacity, ability, knowledge & experience.
The recent Monhemius, Hedjazi & Saeedi Ali report is also clearly indicative of the inventiveness & diligence that is present in the company.
No matter what the ore complexity encountered, the team have found a way to create & optimise processing to keep on battling costs down and target higher production.

We remain a totally unique investment opportunity in the region & just now on the cusp of moving to the 100k oz bracket .. rapidly growing financial metrics aside, that 100k oz figure itself helps promote the perceived scale and maturity of the business.
The wind is clearly in company's sails & it is very well earned.

(Come on share price Angel chap. Pull your finger out, see this for what it is & write it up accordingly).

Good weekend all

[puntogt] 15/9/2017 17:42

1/4 Mill sell showing now.

[mcfly79] 15/9/2017 17:05

Thanks for the great posts today guys.

I've seen the link to the PSA in the header and may try to read through it over the weekend. Could someone give me an idea of how it works?

Thanks

[puntogt] 15/9/2017 16:16

Not all buys appear to be shown...again!

[jbe81] 15/9/2017 15:48

Surprised there is not more buying this afternoon. Could well get interims on Monday am

[friendzarin] 15/9/2017 15:43

Excellent posts Matt and JB and thanks for taking the time to give the board the whole perspective.I am in total agreement with your points Matt and appreciate the opportunities you outline JB that are potentially available...there is no but...from me in this discussion.

[jbravo2] 15/9/2017 15:23

Hey FZ.
Its not as clear cut as people often paint it.
Matt is, as usual, 100% right!
The PSA is double edged. It's great whilst your building, developing, spending.
It lets you recover 100% of the costs involved. You can't get better than that. (AIMROC's PSA was marginally better. It also allowed 100% recovery of costs but their RATE of recovery wasn't limited to 75% of revenue like AAZ, they had 100% rate. Of course it is doubtful we could get that kind of deal for obvious reasons, and indeed I don't think it really matters about the extra RATE, the total is the important part.)
Whilst there is still a chance of spending more on plant (e.g. if we do expand flotation) then I'm in favour of leaving it as is.

I'm sure the company would look at it longer term, or indeed now if they needed to but I'm not sure they do need to yet.
Of course all this would assume the govt wants to renegotiate at some point.
What's in it for them?
Why would the govt give us a better deal?
They can point to the fact that AAZ have made the current deal work. AAZ could in turn point to the fact that they almost didn't make it!

I guess its more likely that terms could be altered if things in the country alter. If AAZ were to get involved in other projects perhaps that could provide the impetus. Perhaps they'd look at standardising deals then? Or perhaps they'd just look to change new deals?

I feel AAZ must be looking for their next opportunity now. They are on the cusp of proving the success of Gedabek. They are in a strong position. In country, AzerGold has tendered for work to understand if Chovdar's sulphide ore is economic. It could easily be economic if they use a plant 30m away. They also have other properties, they are not going to be able to develop them all.
Out of country there has been recent press activity about the gold mines in the west of Iran and various people saying the entrepreneurs in Azerbaijan should look to partner with Iran.

And then AAZ sit still on their loans. I'm surprised they've not been consolidated. I would have thought some new financing would have been sorted by now. Perhaps it is inconvenient to do with other stuff happening.

And best of all, all this would simply be a bonus (albeit a MASSIVE bonus) to the existing case which still sees us undervalued, under reported, little known and simply off most investors radar.

[mattjos] 15/9/2017 15:16

I fully accept that many people will not touch this with a bargepole on passing inspection:

1. Geographical Location .. ie. It's a 'Stan' as far as many are concerned

2. Many investors, peculiarly imo, don't like the CEO having such a large stake

3. Still some debt on the books

4. It's a miner and therefore always raising equity and never delivering

5. Not understanding the PSA & I like many other struggled to understand for a while.

I would counter with:

1. There are simply not Gold/Copper/Silver mining investment opportunities in Godalming so, get used to the fact that big reserves tend to be in some far-flung places.

2. I prefer to see the the CEO/founder/owner-manager having a large chunk of the equity. Who better knows the value of that than the guy who started and runs the business? Such a person is going to be much more highly motivated than someone only owning 5% of a business.

3. I don't mind manageable debt if it clearly there for the purposes of growing the business and once it's been used to achieve that, it is quickly paid down. What I don't particularly like to see if a high debt loading that is always rolled over whilst the company also pays dividends. That is non-sensical to me and leads me to believe the divi is there for window-dressing / artificially propping up the share price in order for mgmnt to reap incentive bonuses in some way.

4. This company has consistently delivered on its growth plans & has never diluted the equity since IPO

5. As the first mining company in Azerbaijan, neither party had a template for how to structure such a deal so, the govt simply used the existing PSA that was in place for the more established O&G industry. It's not 'perfect' I agree but, what is?? I am sure there will come a time when the govt formally reviews it in conjunction with AAZ - particularly if would-be external mining companies, wanting to mine in AZ raise it as a barrier to entry & echo what I believe Reza has already fed back to the government.

[friendzarin] 15/9/2017 14:29

Thats good Mattjos and I appreciate this will be a more relevant discussion in the future if exploration and resource upgrades mean AAZ is potentially able to make a step up in market cap etc. That would be significant progress so it may be the case that the timing of renegotiations with the government to produce a win / win outcome ( i e an overall boosting tax revenues in any event )will be very important.So it can be parked up against future developments for now. The thought of a 2p dividend sounds attractive and istm although a relative newcomer to AAZ that it may sound even more appealing to Reza with his holding .( also my brief observation of John Sununu leads me to believe he would certainly be up for this ;))

[mattjos] 15/9/2017 13:15

PSA is a double-edged sword .. in the current circumstances ie. with debt and carry forward tax losses and the advantageous terms of depn. on capital items, the PSA is a real boon for the company so, we don't want to be in any particular hurry to change that right now.

Once the debt is paid off and we are better off by $11m per annum (cap & int payments, there should easily be the cash available to pay a modest dividend. 2p per share would only cost them $3.5m per annum.

[friendzarin] 15/9/2017 12:59

Good post JB and I'm 100% with you.The one ongoing niggle that constantly seems to reappear is the unfavourable terms of the PSA in comparison to what might otherwise be available.In fact the Nomad even mentioned it as potentially holding the price back after the AGM. Catsick also posted some very salient points on this just recently.What leverage can be brought to bear by Reza and the board to reposition more favourable terms with the government and is that likely to happen do you think ?

[bleepy] 15/9/2017 12:32

Surface and Gedabek Open Pit Exploration will allow the Company to assess the extent of the higher-grade gold mineralisation below the Gedabek open pit as found in exploration drill holes.

Ore production has been reduced from the Gadir underground mine (from February 2017 until September 2017) to allow for development and exploration drilling.


Will have to wait and see what the interims reveal of the above alongside other pending news.

[jbravo2] 15/9/2017 11:31

On the back of your post of upcoming news mr sporrans and bobbieblock posting a few highlights it is just worth running through a couple of points for our newer posters. This share genuinely is unique. I've never had an answer to my challenge of find me a share like this elsewhere.
Please.
I'd be buying it if I knew of it.



These are a few of the reasons this share is so exciting. A few of the reasons why this is my largest holding. A few of the reasons why I know the holders of 10m shares. A few of the reasons why I'm so confident.


- The company is currently valued at what, about £35m?
- Revenue this year will be $80m at least.
- Revenue next year will be closer to $100m.
- The main debt (the one used to construct the AL plant) is paid off in 11 months. That will free up $2.5/qtr
- The new resource is sooooo ridiculously cheap to mine and process. It just has to be dug up. The strip ratio is LESS THAN ONE. i.e. there is more ore than waste.
- The number of shares here is small. 113m. The board own over 40%. The CEO owns c.30%. That means he isn't keen on raising cash by issuing shares. He has NEVER done it. The rest of AIM sees CEO's not owning the shares, just collecting their wage and frankly not giving a stuff about the shareholders. Of course they say they care, what else can they say? But their actions tell the opposite story. Not so here.
- We have plant worth >$100m
- We have completed a huge amount of depreciation on that plant by keeping the resource low (plant is depreciated on a mined oz/reserve oz basis)
- We have tax losses to use.
- We are polymetallic and have the plant to treat virtually any economic ore found



Jeez the list goes on and on.
If you're here reading this, well done. You're in early and before a crowd arrive. Still only a few dozen trades each day. It won't last long.
Results this year will be ok but 2018 results will be stratospheric. If you can wait for them you'll do very well.
If you can't wait that long go find an oil explorer drilling wildcat wells. It'll be more "exciting" than here.



Can anyone think of a reason why the share price will be lower this time next year? Basically it comes down to earthquake and war.
Other than that.

Up, up, up.