News

October 20, 2008

Anvil Mining Flashes Red And Green At The Same Time As Grade And Production Balance Congolese Risk

By Our Man in Oz

There are two ways of looking at Anvil Mining. The first view is coloured red. The second view is coloured green. Red is the colour of Anvil’s share price on traders’ screens as the African-focused miner gets beaten up by the falling copper price, by a government-sponsored revamp of local mining law, and by a failed capital raising. Green is the colour of the ultra-rich malachite ore being mined by Anvil in its mines in the Democratic Republic of Congo. Investors over the past year have tended only to see Anvil through red-tinted glasses, and have marked the Toronto-listed stock down from a high of C$19.50 to recent trades at C$3.00, an 84.6 per cent slide which includes all possible and imaginable bad news in the stock. Looking ahead, as Anvil re-groups after the disappointments of the past year, the colour-coding for the company switches to green for a very simple reason: grade is king.

For non-geologists, the latest annual report of Anvil provides the best example of the high-quality ore it is mining at its Dikilushi and Kinsevere mines. On page 10 of the annual report there is an in-pit photograph of a truck being loaded with super-premium malachite ore at the Kinsevere mine. It shows rich seams of the stuff in a freshly cut wall of ore behind the truck. It looks, in the words of one older geologist, good enough to eat – which would be rather unwise.

However, that picture...