Anglo Asian Mining Share Discussion Threads

[mattjos] 14/10/2020 12:35

If you look at the Gold chart in Hourly candles you can a very, very clear case that sub-$1,900 gold is lasting less and less time on each drop below.
Looks to me a very clear case of the market buying the dip in Gold for the last 3 weeks.
I do expect gold to move up soon and have a crack at $2,100

[celeritas] 14/10/2020 12:26

It's like someone decides to steal a chunk of your garden then lets people camp on it to try and legitimise it. The whole world reconises it as yours but have done nothing about it. In the end you have no choice but resort to force to get back your land.

[mattjos] 14/10/2020 12:11

re-processing these old Leach Heaps is really showing us now just how much gold there is still sat there from the early days of production.

All the extraction costs have been expensed years ago. It's already crushed and ready to feed into the AL plant. Just needs the short haul and grinding before processing.

Not only does it show how much 'easy to get at' gold there is sat there but, it also very much reinforces Steve Westhead's point about there being net $30m+ of Gold in the Tailings dam that went down the pipe from the early days before we had the plant to process it as effectively as we do now.

Once the new Tailings Dam site is confirmed and constructed, we are surely going to re-process the existing Tailings and get at this $30m+

[lefrene] 14/10/2020 12:07

Sceoticalinvestor, so the Armenians didn't invade Azerbaijan then, and deport the 800,000 Azeri's living there, murdering 30,000 in the process? So in fact the Azeri's are now engaged in stealing land from the Armenians? Presumably in your book the UN hasn't ruled that Armenia must leave the land it has stolen from Azerbaijan? Land which Armenia refuses to leave in defiance of international law. Isn't the internet fascinating for what it reveals about what goes on in the heads of some people. Don't bother replying, or making an apology for calling me a liar. You're binned.

[picardy] 14/10/2020 11:57

At this rate, would not be surprised.

[brasso3] 14/10/2020 11:52

Blue finish? :)

Had an order in at 103p but did not get filled. :(

[gutterhead] 14/10/2020 11:48

Oh dear. They’re all out today

[mattjos] 14/10/2020 11:45

anyone else following CPX here?

[meathed] 14/10/2020 11:16

40578

You could get a job with one of those paid research houses - that post reads just like one of their superficial notes.

[2sporrans] 14/10/2020 11:13

Further to my post 40575 above:

if the FY gold production is just 5% lower than target,
the implicit Q4 gold production will be ~18.4k oz. [almost 1k higher than last year].
And that is still a Q4 delay situation; the resource as such and potential for production thereof in 2021 is not reduced.

Not sure if my point is getting through.

[mr roper] 14/10/2020 11:07

Polx, flying again today. Well worth a look. Groundbreaking tech

[mattjos] 14/10/2020 11:03

Jeez, the world is in the middle of a pandemic. Companies all over the world are cutting / halting their dividend payments & seeing their businesses decimated with 30-50% revenue declines.
Azerbaijan currently in a localised flare-up of an age old territorial dispute.

AAZ still delivering .. all folk can do here is whine. Suggest you go and invest in Lloyds or some other 'safe as houses' bank

[2sporrans] 14/10/2020 10:59

FZ

Yes, that may well explain why they were/are needed.

I totally missed on the possibility, having chewed over the conscript idea briefly.
My thinking was that the military would not be wanting much in way of conscripts
for the front line or HQ; it's highly trained specialists they will want but not mining engineers.

[terropol] 14/10/2020 10:58

Good point Friendzarin,
Due to the companies close relationship with governement would not be surpriced if engeeniers could have been offered to help with strucual problems.

[picardy] 14/10/2020 10:56

Mattjos - very helpful posts!

[the stigologist] 14/10/2020 10:53

Griffiths is close to 4D Management so that is a very very good sign IMO

[mattjos] 14/10/2020 10:47

Anglo Asian Mining* (AAZ LN) 110p, Mkt Cap £125m – Q3 delivers 18.2koz GEO with FY20 guidance under review

BUY – TP under review

• Q3/20 production totalled 18.2koz GEO (Q3/19: 20.2koz) at actual prices.
• Gold production amounted to 15.5koz (Q3/19: 17.8koz) reflecting weaker metallurgical recoveries at the agitation leaching plant.
• Copper production came in at 0.7kt (Q3/19: 0.5kt) on the back of steady flotation plant operation and stronger contribution from the SART circuit.
• Silver production was 31.0koz (Q3/19: 33.4koz).
• 9M/20 production totalled 50.7koz GEO (9M/19: 60.1koz) including 43.4koz gold, 1.9kt copper and 90koz silver (9M/19: 52.2koz, 1.5kt and 117.7koz, respectively).
• Q3/20 gold bullion sales were 6.6koz at an average gold price of $1,947/oz (Q3/19: 14.9koz at $1,513/oz) as the team time sales to take advantage of stronger gold prices.
• The balance of the quarterly gold bullion production (6.3koz) was sold in early October post quarter end at an average price of $1,910/oz.
• Copper concentrate sales totalled 2.1kt for $3.4m, ex PSA (Q3/19: 2.3kt at $3.4m).
• The start of underground mining below the Gedabek open pit is underway.
• The Company had $21.4m in cash as of 30Sep/20 with some $12.1m of unsold gold inventory that cleared in early October as described above.
• This is post $5.1m in final FY19 dividends and $3.0m in corporation tax paid in Q3/20.
• FY20 guidance is under review amid operational inefficiencies resulting from the flare up of the Nagorno-Karabakh conflict with the conscription of a number of engineering staff as well as reported development delays due to underground rock faulting.
• The team expects a 5-10% downward revision to the FY20 guidance of 75-80koz GEO.
Conclusion: Production picked up on the previous quarter reflecting better processed grades with gold prices picking up strongly during the quarter amid a drop in real rates. Operations continue despite an escalation in the Nagorno-Karabakh related conflict between Azerbaijan and Armenia at the end of September and still ongoing, although, the Company is currently reviewing FY20 guidance that is expected to be reduced by 5-10% from previously envisaged 75-80koz GEO. Nevertheless, FCF generation remains strong with the Company continuing to build cash balances while covering dividend payments and ongoing exploration programme aimed at growing the Gedabek life mine with updated mineral reserves/resources due shortly.

[friendzarin] 14/10/2020 10:40

2s. Re conscription of engineering staff.I could see a situation given their relative proximities in the region a possibility where specialists on the Gedabay site are deployed to Ganja where no doubt such specialism support may well be required re missile damage.Hopefully more detail will emerge.

[2sporrans] 14/10/2020 10:33

So, returning to the key issue that has emerged:

" Full Year 2020 ("FY 2020") production guidance is currently under review following some minor delays in the underground development arising from the effects of the Azeri and Armenian conflict due to the conscription of a number of engineering staff and some recently encountered temporary delays due to underground rock faulting "

Taking this at face value, it seems it is the knock on to the Q4 production contribution anticipated to come from the new underground mine development ores that will impact upon the full year production.
The rock faulting delays obviously tie in.
The lost, conscripted engineering staff were implicitly dedicated to the new development.
Not sure if that is the full story, just how it reads.

The rock faulting is clearly a temporary problem.
To extent replacement [contractors?] can be found for the absent engineers, this
problem will also be temporary.

So, there are 2 questions begging:
1. what will the Q4 gold production be?
2. what will the 2021 gold production target be?
i'm focusing purely on gold, leaving copper+silver aside.

We know:
"Gold production of 43,384 ounces (YTD Q3 2019: 52,198 ounces)"
last year the q4 gold production was ~17.5k and FY very close to 70k, the lower end of the [revised up] target range.
This year, in order to make 75k GEO, the gold production needs to be around 65k.
See latest presentation.

Well, if one takes a full 10% reduction off of 65k, that reduces to 58.5k

At end of Q3, gold production [including from flotation] was 43,384 oz.

So to achieve a [worst case] 10% reduced FY for gold, a Q4 production of a tad over 15.1k is required.

That will be above the 15k achieved for Q3.
And we can see the cashflow that generated, resulting in [now] $34.5k in the bank.

Just chew that over.
If the FY reduction is as little as 5%, the Q4 production will still e a bumper one, if the POG holds up.

As for 2021, well given the rock and staff delays are temporary, does the reduced Q4 production picture support a target for gold production of over 60k?
I think that it does.
And am ok with that.
noting also that the copper production is actually pretty good, now and ongoing.

[wanobi] 14/10/2020 10:30

aha, thanx for the heads up MF,,, great to see that :-) Cheers Wan :-)

[mad foetus] 14/10/2020 10:25

Griffiths adding at 4D

[terropol] 14/10/2020 10:15

SCEPTICALINVESTOR,

Our CEO holds 29% of the company. He has never sold 1 share. He is a clever and respected gentleman.
Do you think he is brainwashed?