The source is back:
Central Asia Goldfields [CGZ.M] & Kazakstan Goldfields
[KGFC:CDN]
The source had more comments today. The last time he spoke about Investors
Group both stocks did very well... lets see if he can do it again!
The race against time...
As I mentioned to you last week, Investors Group (IG) come out with the news
release which stated that they hold 904,100 at the end of May. Sorry my estimate
was out by only 4,100 shares. You must admit though, I was pretty close! Adding
June selling, including today, IG holds around 600,000 shares. Within a couple of
weeks IG should be totally out.
So why am I saying "the race against time"? Here are the scenarios:
Once IG is done with the selling, without any news releases etc., the stock should
spring back quickly to $1.50 simply because the stock is extremely oversold. If
good news comes out, and it will, while IG still holds stock, the shares may
continue to be under pressure. If IG is done before good news is out, the shares
will finally be on their way to $4.00 to $5.00 range. At least we know it will not be
very long now.
To the new comers to the Insider Report that are not familiar with CGZ and KGFC,
here are the highlights on these companies:
Central Asia Goldfields has 13.4 million shares outstanding, 18.3 fully diluted
(exercised at $4.00+). CGZ gave birth to KGFC to acquire operational control of
the three mines, Aksu, Bestube and Jolymbet. CGZ owns 16% of KGFC shares,
as well as a 25% interest in KGFC production. Including its interest thought
KGFC, CGZ properties have a current attributable resource of more than 8 million
ounces of gold. Most of its properties have deposits that were already delineated
by Soviet geologists; all that remains is to verify past results through new drilling.
The company has exploration licenses covering 11 million acres. Now, where on
earth can you buy shares where the stock capitalization is $10 million and gold is
almost equal at 8 million ounces. It just shows how oversold the stock is.
Kazakstan Goldfields has 34.5 million shares outstanding, 45 million fully diluted.
KGFC reserves are around 4 million ounces. It holds exploration licenses covering
three million acres. Current production is 55 thousand ounces. Once the CIP
facility is built, the 1998 production forecast is 175,000 ounces increasing to
330,000 by year 2000. Cost of production is under $220 /oz. REMEMBER, CGZ
gets 25% of production revenue. At US. $120 per ounce and only 13.4 million
shares, it looks pretty good for CGZ, doesn't it?
Of course some of you may ask why I'm focusing on CGZ when KGFC will build
the CIP that will transform KGFC from an exploration company into a production
company. Remember I mentioned to you about "the hidden treasure is in CGZ."
Well, I just gave you a hint above, but there is much more which I shall cover in a
future posting. For now, mark your calendar, KGFC should come back VERY
shortly, this week or next, to $0.70 or $0.75.
While you do your due diligence, check recent news releases on CNW, and prior
to March 1997, on CCN. Drill verifications for CGZ shows to be 10% better than the
Soviet's results. Also, please note that the web site for CGZ is undergoing revision
and should be completed this week. KGFC web site is under "kazgold."
Well, you can lead a horse to the water, but you can't make him drink. Could the
horse be "her"? Now, if you scream "shoooow me the moneyyy", I'll say I just did,
but I can't make you take it!!!
The Source...I'll be back!!! We are still left guessing at what is going on.Roger |
