MINING MARKETS & INVESTMENT NEWS — INVESTMENT COMMENTARY — Analysts await results from African explorer

Mining analyst George Topping of Deacon Capital is keeping a close eye on results from exploration programs being carried out by Birim Goldfields (BGI-T) and its joint-venture partners in Ghana, West Africa.

The analyst is particularly interested in the Dunkwa gold project operated by Birim’s partner, Battle Mountain Gold (BMG-N), and the 90%-owned Bui gold property, optioned by Newmont Gold (NGC-N). The property is 40 km from the famous Ashanti gold mine, which has operated for more than 100 years.

“The [Dunkwa] property has producing mines to the north [Ashanti] and south [Bogusu and Prestea] of it, along the same belt, and exploration within the property to date has been positive,” Topping notes in a research report.

“The Bui property is in the early stage of exploration, but the presence of mineralized Tarkwaian conglomerates, on which three large mines in Ghana have recently been built, is an exciting target.”

Birim has a third property in Ghana, the 90%-owned Akrokeri property, which hosts the defunct Akrokeri mine (closed in 1909). While some soil sampling and drilling have been carried out around the mine site in recent years, Birim has placed Akrokeri on hold in order to focus its resources on more advanced projects.

During the past three years, Battle Mountain has spent US$3.4 million exploring Birim’s Dunkwa project. The major can earn a 65% interest by spending US$5 million over four years. While numerous prospects were identified, most of the work focused on the Mampon deposit, situated north of the property’s mid-point.

Based on 14 holes drilled on 50-metre spacings to a depth of 130 metres, an independent mining consultant calculated a resource of 2.7 million tonnes averaging 5.2 grams gold per tonne for Mampon. The resource is oxidized to a depth of about 55 metres, and separated by a thin transition phase from the sulphides.

“While it is still early on in the exploration program, we find the results from Mampon so far, combined with the proven potential of the Ashanti gold belt, to be a compelling argument supporting the strong likelihood of locating sufficient economic ore to support exploitation,” Topping notes.

With the Dunkwa project handled by Battle Mountain, Birim has focused its efforts on the Bui project, where numerous gold showings have been identified. Newmont can acquire a 45.1% interest through work committments.

Situated on a structural belt of the same name, Bui is underlain by extensive Tarkwaian and Birimian rocks. Three major shear zones have been identified, along with numerous prospects requiring further investigation.

Topping gave Birim’s management, both corporate and on-site, a thumbs-up for being “experienced and technically competent.” After describing Birim as a “speculative buy for high-risk gold investors,” he placed a 1-year target price of $1.50 for the company.

Birim has 17.6 million shares outstanding (22.8 million shares fully diluted) and currently trades at about 51 cents.