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Gold/Mining/Energy : Birim Goldfields Inc. (BGI-T)
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To: Brian MacDonald who wrote (493)2/14/2000 4:34:00 PM
From: Brian MacDonald  Read Replies (1) of 922
 
Paraphrase of John Kaiser's - Canspec Research dated Feb. 7, 2000 recommendation of BGI.

Birim Goldfields Inc (BGI-T: $0.26)
Top Priority BF Buy ($0.20-$0.29) for 2000

- announced January 25 - farmout deal with Ashanti Goldfields had finally closed.

- deal essentially transfers ownership of the Mampon gold deposit, and a portion of the Dunkwa concession in Ghana, to Ashanti in exchange for a series of payments that could range between $5-10 million depending on how much gold is established by a feasibility study.

- agreement provides for a royalty that compensates Birim for additional ounces but not in a higher gold price.

- flat or lower gold prices, deal good for Birim,

- higher gold prices, deal good for Ashanti.

- plus side, Birim cashed up to resume exploration in Ghana.

- immediate focus; remaining 190 sq km portion of the Dunkwa concession not covered by the Ashanti deal, and the 7,000 sq km Bui concession in northwestern Ghana in which Newmont has back-in rights and in which Birim is nearly vested.

- both projects have drill ready targets - drilling in February.

- Dunkwa property; Birim to drill Opon target - next door
to Golden Star's Bogoso Mine. 'Opon' - typical Ashanti style shear hosted deposit.

- Bui property; Birim to drill the Tombe-Parabu target defined by a 10 km gold in soil anomaly. 'Tombe-Parabu' - Tarkwaian conglomerate style deposit similar to the Witswatersrand reefs of South Africa.

- cash injection finally happening; happy to upgrade Birim to a top priority bottom-fish buy in the $0.20-$0.29 range

- poor timing of the Mampon sale? See following perspective: Ashanti needs Mampon oxide resource to keep a nearby mill operating for political reasons; Ghanaian government's stake in Ashanti guarantees that any development deal for Mampon that excludes Ashanti would encounter perplexing permitting problems. Even if permitting would not be a problem for Birim, should Birim devote its limited capital and the next five years to developing a finite oxide resource?

- one of few juniors still operating in Ghana; Birim one of the first West African gold juniors to catch the market's attention in a new gold market.

- *JK owns shares.
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