Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Precious and Base Metal Investing -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (32079)	11/5/2004 12:57:36 AM
From: The Vet	Read Replies (1) \| Respond to of 39344

GRZ took what they could get I expect. Management is very conservative and they decided to get the cash into the bank while it was there. The market is what the market is, and no amount of wishing and hoping makes any difference. Even though the PP price was low, I understand that Orion and their accomplices got rid of the entire PP in under 30 minutes and then took up the full optional oversubscription and placed it immediately as well. So somebody with deep pockets is prepared to overlook the "political risk". GRZ with a MC/P&P of around $15 is simply great value, extremely under promoted and unfashionable. There isn't a news letter writer or analyst who follows it or issues any regular updates. Amazing, considering on a P&P reserve basis with 9.1 million ounces it comes in as number 16 worldwide in all gold and silver companies (using gold equivalent for the silver). Most analysts, and in turn the potential investors, dismissed Brisas years ago because, while Gold Reserve kept drilling and proving up more gold and copper, the prices of both metals continued to drop and the stock languished. Now apart from some routine infill drilling on Brisas there is little chance of upside surprises from the drill bit except for the exploration on Choco 5 that most don't even know about. Funnily enough I suspect that if GRZ only had Choco and $50 million in the bank it would still trade at $3 to $4 a share, so where does that put the value of Brisas, with a proven 10 million ounces? The fact that the gold and the copper of Brisas are proven, pit design, processing, bulk sampling, title, permits etc. are all either completed or substantially completed, is all old news and there is little there to excite the speculator but it is just a bit early for the value investor. GRZ missed the boost it should have got from the initial discovery and proving up period in past years because it coincided with the period of low prices that prevailed at the time. It was rightly considered uneconomic at $300 POG and 80 cents a pound copper. However, few bothered to update their views with $400 gold and 1.25 copper. Despite the fact that GRZ has been forced to finance at prices below fair value, it is still a very sound investment IMO. Fully diluted they will still only have 40 million shares, a modest number for an over 10 million ounce reserve, around $50 million in the bank, no debt, uncontested title, a couple of billion pounds of copper, a positive pre-feasibility study completed, they are up to date on all permits and with a full bankable feasibility study due within a month or two. If the market doesn't wake up soon, I expect there are plenty of other companies who would like proven reserves ready to mine at what is less than exploration cost. The presence of a poison pill may be keeping the unwanted offers at bay, but I am sure that a fair and friendly offer wouldn't be refused by the shareholders.