News

July 10, 2008

In These Wild West Markets It's Only A Matter Of Time Before Central African Gold Asks For A Few Dollars More

By Rob Davies

Minews usually has to chase mining bosses to get them to talk about how they are deploying shareholders money to increase value. So it made a pleasant change when Greg Hunter of Central African Gold made strenuous requests to have a chat with us. It seems there was some concern in the market that we might say something negative about the company. And how could we not, when finances are increasingly stretched and the shares are dropping like a lead weight in a fish pond? But over the course of a long telephone conversation Mr Hunter explained in great detail the problems the company has faced and exactly what steps he is taking to resolve them. That at least beats running for cover at the first sign of trouble.

 For those not familiar with Central African Gold it might help to explain that it has pursued a growth strategy of acquiring gold mines in Africa that have the potential to be upgraded. Or to put it another way, bringing old assets back into production. The company’s flagship property, Bibiani in Ghana, was acquired for US$40 million at the end of 2006 and this year was when it was intended to hit its straps. The fact that it hasn’t, and has forced the company into a refinancing exercise,...