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NewswireTODAY - /newswire/ -
New York, NY, United States, 2007/11/27 - Madison Avenue Research Group issued a report on zinc mining, related equilibrium in pricing and economic incentive. The report explores the interim zinc supply gap closure and related opportunity look forward.
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Madison Avenue Research Group issued a report on zinc mining, related equilibrium in pricing and economic incentive. The report explores the interim zinc supply gap closure and related opportunity look forward as the story taking shape in the market place is the strategic positioning of producers and near term producers to capitalize on global trends that are expected to cause critical shortfalls in production to meet demand going forward only a few years from now. An inflection point model relating to the locating of undervalued shares of pre production zinc miners with resources pinpoints a case study of zinc-silver entity Abcourt Mines Inc. (TSX VENTURE:ABI) with a large zinc resource base and a 13 year mine life.
Excerpts from report:
1) London Metal Exchange zinc stockpile inventories are off their critical low levels. The story taking shape in the market place is the strategic positioning of producers and near term producers looking to capitalize on global trends that are expected to cause critical shortfalls in production required to meet demand going forward. It is a general consensus among experts that a series of new global zinc mine production that is now beginning to come online are expected to narrow and subsequently close the supply gap for an interim period, and that interim period is not likely to last long before the supply gap re-emerges. There is some debate as to how long this "interim" period will last and what the effect will be on prices during this interim period, however it would seem there is plenty to be optimistic about for current and prospective zinc producers. ... Consumption forecast and insight going forward several years was articulated in a detailed 12 page November 2007 Canaccord zinc analyst report. The report pointed to China's rampant growing industrial production and that with such a large regional user growing so quickly, it should not be surprising that trend global consumption growth could be moving to a higher level. The Canaccord analyst has the aforementioned "interim supply gap closure (zinc surplus)" expected to last until 2011 and may possibly be moved forward as early as 2009 depending on mine production growth falling in china.
2) Upside Valuation Summary of Abcourt Mines:
In light of the exceptional margins afforded producing zinc mines (many with accompanying metals as a bonus), investors would do well to look at Abcourt Mines Inc. (TSX Venture Exchange: ABI)(Pink Sheets: ABMBF). Abcourt Mines is a Silver-Zinc and Gold mining entity with in excess of 750 Million+ Pounds of Zinc and a 13 year mine life as identified in a recently optimized feasibility report. A recent analysts report released this October pegs a 100%+ near term upside valuation from numerous potential project scenarios/catalysts.
The qualified Analyst has identified Abcourt Mines Inc as significantly undervalued with its five projects being heavily discounted at current share price valuation of under CDN$0.50. The Abcourt-Barveau silver-zinc deposit alone has significant resources which the Company's independent feasibility report indicates as economically mineable with a 13 year mine life and this one project alone is significantly discounted with the market capitalization of Abcourt Mines Inc. under CDN$20M; Abcourt has well in excess of a billion US dollars of zinc resources at current market prices. Abcourt Mines also has 19,644,354 ounces of silver at the Abcourt-Barvue project and 198,744 ounces of gold at it's Elder Gold Project.
The Analyst provides a compelling risk-reward picture for inventors as Abcourt is currently undervalued at between a mere $0.01 - $0.02 per Zn-equivalent lb found at the Abcourt-Barvue project alone, a level at the low end generally attributed to earlier stage exploration companies with resources. The currently share price is only attributing value to the in-ground zinc resources at the Abcourt-Barvue project - ignoring its large silver resources, other properties and the significant infrastructure the Company possesses from when it was a past producer at the silver-zinc operation and the Elder Gold mine sites.
This release may contain forward-looking statements regarding future events that involve risk and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual events or results. Reports herein are for information purposes and are not solicitations to buy or sell and of the securities mentioned. Readers are referred to the disclaimer and disclosure section at the bottom of the above referenced URL.
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Contact: James O'Rourke
editor[.]madisonaveresearch.com
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