----- Original Message -----
Sent: Friday, March 12, 2004 6:55
PM
Subject: Re: RE: [sharechat] MIC
-Article
MIC is in the
last stage of reorganizing in China and it seems that the Chinese are very
cooperative.
The picture will look quite different once the new
financial year starts.
Gerry
Readers, please do your own research and you decide if and when to buy,
hold or sell any stocks.
________________________________________
Here is MLC's
website:
http://www.michelago.com/home.html
Article from
Miningnews.net (about $160/year):
_____________________________
In
search of Chinese gold
Tim Treadgold
Wednesday, March 10,
2004
USE THE words China and gold in the same sentence and you're
guaranteed to grab the attention of anyone in the mining industry. The
combination explains why Sino Gold has been a spectacular success on the
Australian stock market and why more newly-created China gold specialists such
as Michelago seem to be travelling the same pathway with a sharply higher
share price and the promise of substantial gold production starting later this
year.
Speculators love the Michelago story, as is obvious from the
share price. Ten months ago the stock was limping along at 0.6c a share. In
early February the price was 12c. The rise of 11.94c is, just for the sake of
a silly calculation, a remarkable 19,900% -- not that this number is the
height of the Michelago miracle; that is bestowed on the imaginary punter who
got set at 0.6c on April 4 last year and sold at the 52-week peak of 16c on
October 6 – a cool 26,566% in six months.
The share price rise,
obviously, is a meaningless exercise, though it does serve to illustrate the
point that China and Michelago are hot. The only question left hanging is
why?
The answer to that lies in the fascination with the theory that
says China is opening itself to foreign investment, to greater gold ownership
among its 1.2 billion people, and to modern exploration and mineral processing
techniques which will cause a revolution in the world gold
market.
"China is already a world-class player in the gold industry,"
said Michelago chief executive, Peter Secker. "On mined ounces alone it is the
fourth biggest producer after South Africa, the US and Australia.
"But
that is only one aspect of the industry. For the past 15 years, gold mining in
China has been pretty much dormant. It is a country with a highly attractive
geology that is crying out for investment and the application of modern mining
technology."
Secker said some outsiders still had a false view of doing
business in China and of its mining industry. "New mining laws, modelled very
much on Australia and Canada, were introduced in 1997," he said. "In 2002 laws
governing foreign investment in gold were lifted which have proved to be a
real attraction to international miners."
As an example, Secker points
to recent joint venture exploration deals involving South African gold giant,
Gold Fields. However, what he should really be pointing to is his own
involvement in China and the deals he is pulling together for Michelago.
Understanding what Secker has done goes a very long way to explaining how
Michelago evolved and why it has its current shape – a shape which can be
confusing because it is "a work in progress".
That work consists (as at
early February) of a proposal to own 82% of a gold treatment complex in
northern China called BioGold. It has a bacterial leaching and carbon-in-leach
processing facility, plus a gold refinery to toll treat ore and
dore.
Michelago also has a 60% stake in a proposed 40,000oz per annum
gold mine scheduled to come on stream later this year in southern China, plus
interests in a number of exploration plays, some of which are chasing "Carlin
style" gold deposits of more than one million ounces.
"I've been
involved in China since 1993," Secker said. "Originally I was vice-president
of Sino Mining, which became Sino Gold. My work put me in charge of all
operations in China, living there for three years, building mines, before
leaving in 1999 to do my own thing in China."
One of the projects
Secker became involved in was a bacterial leaching plant, designed and built
by Minproc, and working as a replacement for environmentally unacceptable
roasting plants on the Chinese coast.
"I had previous experience
building the Youanmi bacterial oxidation plant, using BacTech technology, for
Gold Mines of Australia," he said. "I left Sino and said to the government why
don't I build you a plant using BacTech. After a lot of thinking they said do
it, and they now have the most modern bacterial processing plant in the
world.
"We took a plant that would have cost $25 million in Australia
and built it for $10 million. China is a place where you can achieve some
astonishing things. We started the plant in late 1999/early 2000 and within
three months we had it commissioned, which is exceptional. It is now producing
between 80,000-90,000oz of gold a year with some concentrate from Sino and
from other mines, which we blend to get a constant feed."
The total
BioGold facility (consisting of a number of plants) produces 300,000oz of gold
a year. The original plan had been to acquire a 50% stake in BioGold. This has
risen to the current 82% which is waiting on government approval which Secker
expects to receive around mid-year.
For students of Australian gold
history, BioGold in China completes a circle by bringing together again Secker
and Stephen Everett, one-time chief executive of GMA and a strong proponent of
the BacTech process. Everett is a major shareholder and non-executive director
of Michelago.
THE second key deal being worked up by Secker is a 60% stake
in the Jinya gold project in southern China.
John Horan, Peter Secker,
Andrew Haythorpe, Stephen Everett
,b>MARKET CAPITALISATION
$50
million (at press time)
MAJOR SHAREHOLDERS
Peter Secker
(9.1%)
Stephen Everett (5.8%)
Andrew Haythorpe
(3.4%)
See IRG research reports
