bgf equities research report

Dear Shareholders and Investors

With debate raging about the Federal Governments plan to apply a 40 per cent tax on the profits of Australian resources projects, I thought it may be an opportune time to share with you a leading stockbrokers research note concerning West Africa.

The analysis by respected institutional broking firm BGF Equities draws a glowing conclusion about the growth prospects for a range of Australian-based gold companies operating in West Africa.

Analyst Warwick Grigor, who hosted a recent trip for investors to several West African gold projects, including Azumahs Wa Gold Project in Ghana, said in his note that West African gold stocks offered greater exploration upside than Australian brownfield projects, without the technical problems associated with going back to old projects.

A virginal open pit operation carries much less risk than deepening old pits and proceeding underground, Grigor wrote. Recent events have shown that geopolitical risk is escalating in Australia with a government unsympathetic to mining. West Africa is one of the hottest places to be in the gold sector and will remain so.

Grigor went on to provide an extremely favourable assessment of the outlook for Azumah. AZM is playing a catch-up game in the market with the shares still looking cheap, Grigor wrote. At the time of his writing, Azumah shares were 34 cents.

Maybe this is because the management is not as promotional as others and it is leaning towards an earlier, more modest startup operation of less than 100,000 oz pa. It continues to offer sound value with active exploration.

Please click here to download Grigors note. I hope it is of interest.

I am also pleased to report that work in preparation for a maiden resource at the Collette deposit at the Wa Project is proceeding well. You may recall that recent results at Collette included 20m at 7.43gpt from 76m.

Meanwhile drilling is well underway to extend the interim 350,100-ounce resource at the Julie prospect and drilling is also taking place in the flagship Kunche-Bepkong district, where resources stand at 750,000 ounces.

The feasibility study for Wa is scheduled to be completed this year, with Azumah looking to establish a project which produces 100,000 ounces-plus a year with a long life.

Results of the various drilling programs underway will be released to the market as they come to hand.


Yours Faithfully

Stephen Stone
Managing Director


http://www.azumahresources.com.au/documents/rr100511.pdf