EAST ASIA MINERALS
(EAS)
$7.56
+1.26
We did say we loved you right Dave Coffin...in a manly, non-
weird way! We have been writing up East Asia consistently over
the last 6 months and there is little doubt now that it is becoming
the play of the day.
Today East Asia announced more drilling results from the most
northerly test of the Miwah Zone, according to the ‘Hardrock Ana-
lyst’ indicating that at least on this section the zone is actually
strengthening.
The big news though, is from drill hole EMD024,which cut 111
metres of 3.96 g/t gold, which included 22 metres of 15.74 g/t gold
at the bottom of the hole.
When we talked to Coffin today he suggested that there is the
chance that this could be a feeder zone but on the other hand the
22 metres of 15.7 grams came at the bottom of the hole, when they
get a bigger rig in there who knows. Maybe this could have all
sorts of additional depth to it! Hey folks, imagine if this hole has
another 20, 50 or 100 metres to it...and heaven forbid if it got
richer, this is the kind of stuff that dreaming about exploration
conjures up.
Coffin points out that “The next few holes will determine how
solid the upside is”. And in writing in the ‘Hardrock Analyst today
they add “This news is taking the stock to new levels and again
making it a traders’ darling and cleaning up the EAS market at its
higher level”.
In the ‘Hardrock Analyst’ they write “Hang onto your hats”.
Well that has been an understatement and to think that the Coffins
have been writing up this story since about $0.50. Much thanks to
them we have been writing it up since around $1.75, but either way
it’s obviously becoming one of the stories of the day and those
two extra drill holes when they do come out in a few weeks will
add even more excitement. Or not!
Coffin also adds to us today, anybody such as another mining
company that was looking at this company before as far as poten-
tial now is going to have to look ever that much harder and ever
that much quicker.
Another important fact, Coffin suggests, is that people are now
feeling much better about Indonesia, more comfortable with the
country.
When we ask Dave Coffin our favorite question, if you had to
buy a stock right now what would it be...he answers, “I’m relatively
happy with some of the ones I’ve got”. One would think so.
EAST ASIA MINERALS (EAS) $7.56 +1.26
Mining analyst Wendell Zerb jokes “I thought that
$7.50 target would be good for a couple of weeks!”,
and he is referring to East Asia, one of the stories he
follows here at Canaccord.
He mentions that he thought that hole 24 could be
good, but it was better than good (once again folks,
the fact that it ended in the sweetest stuff makes eve-
ryone wonder how deep it could go and how much
better it might get). Zerb however, tends to be one of
the more cautious analysts in a pretty high-risk busi-
ness and he points out that ten million ounce depos-
its of this style, as East Asia’s do exist but there are
not a lot of them.
He also points out for those who want to be nerv-
ous about it, that fundamentally this story now has a
relatively big market capitalization. For sure Zerb
and others now will have to be back to the books
revising targets, expectations and the like and ever
more important will be those next two drilling results
on an ongoing story that is becoming one of the sto-
ries of the day.
Back to Zerb and our favorite question, if you could only
buy one today what would it be?...He sticks with Minera An-
des which he calls “a good slow bet”, it has a “few warts he
suggests but it’s pretty cute underneath”, referring to some
of the legal concerns surrounding the stock.
It was nice, he suggests, to see some decent volume to-
day to help Minera Andes break through the dollar barrier
and yes, he points out, that their Los Azueles in Argentina
should be moving past the billion ton level on their copper
deposit.
STERLING RESOURCES
(SLG)
$2.58 +0.18
BANKERS PETROLEUM
(BNK)
$9.18 +0.10
ENTERRA ENERGY
(ENT.UN) $2.85 +0.07
We mention a lot of high risk/high reward plays here
from time to time, and we probably don’t mention enough,
that some of them, like a Cygam is going to drill offshore
Italy, and if it hits could be many times current levels and
if it misses...or a CGX later this year will be drilling in Guy-
ana and if it hits could be multiples of current prices but if
it misses could be fractions of its current price.
There are those high risk/high reward plays out there,
usually our favorites are a little bit different.
When we went to Albania and saw Bankers Petroleum,
one look at that valley told us that they had a resource
there that was just enormous. We wrote it up the first half
of this year, time after time after time.
For much of the last 4 or 5 months, Sterling has been
our favorite story because it is protected with production
18-24 months down the road that should throw out cash-
flow of $1 a share plus, in the meantime starting in about
23 days they spud 5 or 6 different plays, all of which have
varying risk and varying reward potential. As most ana-
lysts tell us off record, Sterling could be anywhere be-
tween $3 and $10 by year end depending on results from
their different plays.
A combination of protection from cash flow down the
road plus a series of plays attracted our sense of greed.
Over the next few months though don’t be surprised if
suddenly we start mentioning Enterra Resources. We will
be writing it up a lot in the coming months.
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