lsg/eagm & gold

On Friday I had a chat with Robbin Widdup, CEO of Lion Selection. For shareholders out there that are interested, he stated that they were "blown away" by the discoveries at Gokona and highlighted the strong posibility of a ''significant upgrade'' in reserves set for announcement in January '03 for EAGM. He also said that the float will be pushed back for March '03 and possibly even further.

Just to remind those that are interested, East African Gold Mines (EAGM) is a 210,000oz pa gold producer in Tanzania, with shareholders including AngloGoId, Macquarie Bank, Lion Selection Group (LSG), Goodman and Company (Canada) and CDC Capital Partners (UK). The company is headed by former North Flinders Mines founder and Chief Executive, Mt. Geoff Stewart.

LSG has a 11.3% stake in EAGM and a 6.3% stake indirectly via a subsidiary called African Lion. At the moment, this stake is valued at cost in LSG's books at about $10M or 10cps. When EAGM is floated, (either here or North America) it should have a market cap of between AUD$350-$500million or up to 50cps for LSG. LSG is at 98c today.

Current EAGM resources are 3.8 million ounces and current reserves are 2.6million ounces.

This is only 1 out of 14 LSG investments, primarily in the gold sector but also nickel, zinc and silver.

I hold LSG