Hi GuysThanks for encouragement in previous thread. I would also...

Hi Guys

Thanks for encouragement in previous thread. I would also like some criticism too. One of my big mistakes in investing in specs has been a tendency to let myself get sucked in and stuck in a stock. I tend to be a believer by nature so I've now come to the conclusion that the best antidote is to look for a reason not to believe/buy. Assessing an ongoing position in a company like GUN we can help each other out by really scrutinising the news for the weaknesses that should tell us to sell - even if only to get a better buying opportunity down the track.

Having said that I'm encouraged by the March 28 announcement. I did read it on the day but have only just come to try and break it down.

Firstly it appears that the Emmie East prospect has been given the flick for now with a non productive drill result on the most prospective anomaly there. Might as well assume it will add no more to the resource at Emmie Bluff of 528kt inferred Copper equivalent.

Secondly I'm no geologist, very far from it, but it appears to me that the combination of drill holes, Induced polarisation (IP) and Transient Electromagnetic (TEM) work is building up a clear picture of the target that will be drilled out at Chianti prospect.

Looking at figure 1 in the announcement the key holes, north to south, are MGD34 which assayed 2 m at 3.4% Cu; MGD 48 which is being assayed for the 60m high tenor intercept from Feb and MGD 44 which intercepted 18m at 520 ppm CU (v low grade imo - 520g/t). I'm forming the impression, together with the overlays, of a possible exploration zone of roughly 1000 or so m from MGD44 (very low) through and east of MGD48 (unknown grade at present) around to MGD34 (short intersection but good grade). No real indication of width to explore but maybe up to around 200-400m at a total guess?? Also it appears they have closed off the southern end of the anomaly for now - no drama as it appears to be very low grade if anything at all.

I'll watch this to see how things shape up - a bit of fun, might even see if I can work out how to get it into Sketchup from Google Earth like whalewatcher has done on cdu thread.

Last week's announcement also implies several news events over April. These may well be coalesced into one announcement though late in the month:
i. April 20. Copper-gold assay results expected from 60m intercept in MGD 48. Company's initial announcement wasn't as positive as the one for MGD 34 so I'm expecting low grade but 60m is a handy start. Look for any unusual activity around that date for an indicator of any leaks.
ii. Mid April. Results on two additional samples from MGD 48 to check and confirm the IP properties of the mineralised zone.
iii. Late April latest should have results for additional TEM work commencing tomorrow. One of these surveys will be along the east-west traverse that MGD 34 (2m @3.4% Cu) sits on so may give an indicator of where the currently defined TEM anomaly in the southern part of the eastern ip zone actually extends to.
Note the hole percussion drilled in 2002, MGP 31, is 400m east on the same traverse. It broke off at 452m mineralisation containing traces of bornite but much shallower than intercept at MGD34 between 549-551 m.
Further the first traces of bornite in MGD48 were at 431-432m, only specks but offers a consistency with MGP31 when you consider that the targetted basement rock starts 40m lower in MGP31. I imagine if the TEM survey confirms the anomaly they will probably put another drill down around the spot to retest it.

I know I'm rehashing the announcement but some may not have read it yet. To summarise - my reading is that we're a long way from a copper resource at Chianti but getting closer to knowing exactly what area should be properly explored. I'm guessing we'll have a fair idea this year if Chianti is no good given that Xstrata have a fair bit of spending to do for us.