Armada Gold 10 Million oz of Gold & 1 billion lb of Cu ! Message Board

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Gold/Mining/Energy : Armada Gold 10 Million oz of Gold & 1 billion lb of Cu !

AAU 0.380

-5.0%

Sep 29 5:00 PM EST

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To: Syncrude who wrote (92)	2/23/1997 11:26:00 PM
From: Syncrude	of 552

I have reviewed the prospectus for last October's warrant issue and would like to share the following: Using 100% of proven&probable, 50% of possible and 20% of resource values for gold and a gold equivalent for copper, as well as weighing for Armada's 85% interest in the gold properties and 49% of the copper properties, I arrive at 7,023,000 oz of Au. Perhaps explaining the weakness in the share price: 1) Armada will require $US297 million to develop the Taseevsko mine 2) further funds will be required to develop the other deposits 3) documentary evidence is lacking for titles in Mongolia, although the company is confident that this is not a problem 4) currency and tax laws in both Russia and Mongolia can change 5) the dividend tax exemption agreement between Cyprus and Russia in to be renogiated 6) it is not guaranteed that Armada can export its gold 7) the political situation in both countries is unstable, for example Mongolia is re-examining agreements made by the previous government. Bottom line, this is a high risk/potential high reward situation with many variables. The share price reflects this uncertainty. The final bankable feasibility study for gold is expected in the 2nd quarter of 1997. This delay may also explain the current share price. In conclusion, I think the share price is fairly valued at this stage of development. As events unfold during the next few months on the political front, we may see the price move up and down accordingly. The very high number of shares outstanding suggest a share consolidation if the feasibility study is favorable, prior to a new share issue. Weakness may persist until this is done. Just my opinion.

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