Extracted from J. Kaiser's latest Bottom Fishing report:
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Birim Goldfields Inc (BGI-T: $0.30
TP BF Buy ($0.20-$0.29)
Tombe-Parabu drilling underway
Birim Goldfields Inc (BGI-T) has completed the second stage of drilling on
its Opon gold prospect in Ghana. Birim drilled 35 holes totaling 2,134
metres 50 metres apart on 25 metre centres. Nine of these holes were
drilled on the main zone, which has now been traced over 200 metres with a
grade in the 1-2 g/t gold range. The bad news is that the zone is pinching
out toward the north though grades did improve. Birim drilled 26 holes on a
parallel zone to the east, which has now been traced over 300 metres. Birim
did not report detailed results, but did indicate grades in the east Zone
are similar to the Main Zone. The purpose of the Opon program was to
establish potential for about 50,000 ounces of gold in oxide ore that could
be processed by Golden Star at its nearby Bogoso Mine. Birim management is
confident it has achieved this target and is in discussions with Golden
Star on a possible mining deal. Birim also drilled a soil anomaly on the
Mansi West target 8 km north of Opon, but apparently results were
disappointing. The main focus is now the Tombe-Parabu target on the Bui
concession in northwestern Ghana. Drilling started on May 11 and as of May
15 Birim had completed 11 holes. Birim plans a total of 117 shallow reverse
circulation holes in two stages. The 4,500 m program will consist of 40
metre holes drilled at a 60 degree angle towards the east to intersect the
westwardly dipping north-south structure that has been inferred from both
geophysical and geochemical anomalies. The target is defined by a gold soil
anomaly with a strike of 6 km and widths up to 300 metres. The holes will
be drilled on 20 metre centres along east-west lines spaced 200 metres
apart. Initial results indicate a saprolite cover averaging 8 metres. Birim
plans to take a break after 50 holes and assess the results. The first set
of assays will be due by the end of May, though Birim does not intend to
report results until it has assays for all 50 holes unless they are
spectacular. However, the nature of this play is such that non-spectacular
but positive results would have important implications for speculators. The
Bui project is located on a virgin structural belt, most of which is
controlled by Birim. Newmont retains a back-in right for 45.1%, leaving
Birim with 44.9% and the Ghana government with 10%. Previous work has
concentrated on the Bui belt's potential for Tarkwaian style conglomerate
gold deposits, but the current program represents the first serious test of
the belt's Birimian rocks for shear controlled mineralization. The Bui
project has company maker potential; if we hear that Tombe-Parabu hosts
mineralization of 3 g/t gold or better over widths of 10 metres or more, it
should kick off a decent speculation cycle. Bottom-fishers should watch
this play carefully for signs of growing management excitement. On March 15
in Tracker 2000-15 I upgraded Birim from a medium priority buy in the
$0.20-$0.29 range to a top priority buy in the same range in response to
confirmation that Ashanti had paid the first tranche of its Mampon purchase
deal. The current Tombe-Parabu drill program is an important crossroads for
Birim, because if this drill program does not produce a discovery, the
junior will drop back into survival mode as it searches for a new
exploration focus. On the plus side for bottom-fishers, the likelihood of
additional cash injections of US $3-4 million from Ashanti and the
possibility of additional money from the sale of Opon to Golden Star limit
the risk that the stock will fall off a cliff. The stock has been under
accumulation for a long time, and has been followed by an impressive list
of mining analysts. The whiff of success would put Birim back on many radar
screens. Now is a better time than any so far to bottom-fish for Birim. *JK
owns shares of Birim. |
