Avocet Mining Share Discussion Threads

[yikyak] 22/11/2005 19:15

"AVM already know that there is a resource to be had and have taken the first step to delineating it by drilling on a grid".

Well spotted Wendy. :-)

[wdurham] 22/11/2005 17:46

Ashley -

I shouldn't get too excited. I have it on very good authority that yesterday's drilling results are "not impressive." LOL!

Andy -

And some of the other busiest threads on ADVFN are where people are busily manufacturing valuations out of quicksilver and gossamer and punting them out as fact to gull the gullible. I cannot believe the market caps on some of the AIM garbage these days.

Zaky -

Mining companies are restricted by the recently tightened AIM rules as to what they can say and what they can't. If their NOMAD interprets the rules strictly (many don't), all AVM can do in an official announcement is state facts. They can't give opinions or use promotional language in an official announcement. Though they could, I guess, be much more forthcoming on their website when they update it? In any case, it is very difficult for them to state what a first pass drill programme actually represents. You have seen for yourself the wide variations in widths and in grades - with sporadic bonanza grades present over short widths, and less exciting grades over nice fat intersections.

But there is one key piece of information buried in that announcement that you might not have seen the significance of. First pass exploration or "scout" drilling is usually aimed at anomalies discovered during surface sampling and geophysics. It's often quite random, with no pattern to the drilling. However, this lot was drilled at 100m centres. i.e., AVM already know that there is a resource to be had and have taken the first step to delineating it by drilling on a grid.

[andy] 22/11/2005 17:29

Kojak,

I agree with that statement, I think certain stocks have been promoted well, whereas other such as AVM don't seem to have any PR or promotion at all.

Some of the busiest threads on ADVFN are where people are losing money, and a lot of the quiet ones are where people are gaining, very strange.

[kojak78] 22/11/2005 16:59

"It's also important to recognize that over the past 6 months, the market has given a serious preference to "garbage stocks," with stocks having low return on equity, return on assets and return on invested capital being stellar performers, while more stable and durably profitable companies have been relatively flat." (Hussmanfunds)

[brad1] 22/11/2005 16:53

Dont worry this WILL fly (imo), just a matter of time to break this resistance level. Could happen tomorrow. Directors holdings only adds further strength to the potential of this company. Will top up again once resistance broken.

[kojak78] 22/11/2005 16:24

to keep things in perspective: since last november avocet fell in US$ terms 6.5% while the xau gained 5%. since march the xau climbed 34% while avocet fell 6%. so we have to make 12%(nov) or 42%(march) just to catch up with the xau performance.

[mr ashley james] 22/11/2005 10:04

Reefseeker,

Deposits that yield grades like "210 g/t Au" ie around 6.75 troy ounces of Gold per Metric Tonne perchance?

Cheers

Ash:)

[reefseeker] 21/11/2005 16:49

Ashley - I'm mostly in O&G and over the last two years have just started to get my head round all the oily jargon. AVM is my sole gold play currently, c. 5% of my portfolio, and I've insufficient knowledge or context to place today's news.

General reaction around here seems positive but can anyone tell what this means for NAV calcs? Even broadly ..... ? If not, then why should Mr. Market get euphoric?

[phillis] 21/11/2005 15:45

Zaky -perhaps VOG had a seismic survey?

How on earth you expect anyone to estimate possible reserves of gold without breaking the surface is beyond me? and have anybody put any credence on them....

[brad1] 21/11/2005 15:11

We can also look forward to Details on Effendi in the not so distant future. Without a doubt this is looking very exciting for the future.

[phillis] 21/11/2005 14:56

Zaky -how would they estimate what they expect?

By drilling perhaps?

[pecker1] 21/11/2005 14:33

zaky,

My personal preference would be for AVM to carry on as it does - sensibly and without hype. There are far too many AIM companies making absurd claims/hints about world-class deposits on the basis of one or two drill holes.

The results from the exploration shows the area is quite complicated with gold veins cropping up all over the place. That's very good news but it could take many months to unravel, so plenty of newsflow to come over the coming months.

[zaky] 21/11/2005 14:19

Wouldn't it be in AVM's share price interests to state the drilling news more along the lines of 'we found blah blah which is X times more than what we expected' etc

This might help clarify the significance of the drill...?

[kojak78] 21/11/2005 13:36

Grades mean nothing. I remember Robert Ch. de Crespigny giving a speech about ore geology. Back in the days of the Australian gold rush some people found several kilos in just 2 or 3 hours. Today most prospects are of very low grades but offer very continuous ore zones. What's the matter in having a 30g/t 1m thick reef in 1000m depth when you can have a 1.5g/t 300m x 600m x 150m open pit? Mining is about more than just the grades.

However, if one decides to mine the Idenburg property by open pit mining it would be very ínteresting to average the ore grades over the whole length. I did that for the 10th drill hole (excluding the "incl." grades). 75m with 1.56 g/t. A rough guess for the resources would be to do that for all holes and average the results. Now all 10 drill holes define a zone with width x length x depth and you have the grades. "All" you need is the density of the rock and some assumptions about the continuity of the ore, then it's a simple calculation (width x length x depth x average grade x rock density x continuity factor).

Remembering that these are scout holes results are indeed very positive. It's more like a window cut into a rough diamond to take a first look inside.

[brad1] 21/11/2005 13:15

Well, worthwhile in Asia - they want to concentrate on this area.

[pecker1] 21/11/2005 12:14

wdurham,

Ahh, the answer lies in the soil!

IMHO, with gold nearing $500 oz and AVM buying into a Chinese prospect, the sophorific, glazed eye effect that AVM seems to have had on many is about to change. Things are beginning to happen and further acquisitions could be in the pipeline as the goldminers snap up anything that looks worthwhile. Roll on 2006.

[wdurham] 21/11/2005 11:55

Pezza2 -

I would call those drilling and sampling results significantly upbeat. I especially like KSD001 - which shows almost continuous gold, with one high grade encounter, from the surface down to 70 metres.

The soil sampling is perhaps even better than most of the drilling results:

"5 adjacent soil samples recorded gold values ranging from 1.43 g/t Au to 3.55 g/t Au over a 125m segment of the ridge."

Gold in soils at the surface is not usually anywhere near that high, often being measured in "parts per billion".

[bestbuddy] 21/11/2005 11:55

One possibility may be the low number of free shares in issue. Most holders of AVM are long term using this as a gold hedge against other equity investments. Any large buyer of AVM would immediately send the share price rocketing before filling even a small part of the order which would defeat the object of buying. So i guess its mainly the private investors buying at the moment hence the share price moves slowly and normally delayed against any news. IMHO i believe the last rise was due to Gold hitting new highs, i think the drilling results are yet to be taken into account. If i am right then i would expect £1.10 by the end of the week.

[sidneyslacker] 21/11/2005 11:51

I was hoping too - but if I look at it from 11.30am Friday and imagine the RNS came out just after I can convince myself it has gone as I would have hoped ... so, erm - Result!

I agree with wdurham though - I imagine for most non-technical readers (including me) the RNS is a bit opaque? :-)

[pezza2] 21/11/2005 11:46

Sidney, I was kind of hoping for something upbeat which would raise the price more than what happened between friday and today - maybe my expectations were too high !!

Wdurham, that's a bloody good answer !!!