Western Goldfields WGI.to/WGDFF a USA Value Producer

Western's Website:
http://westerngoldfields.com/s/home.asp


I like Western Goldfileds Here is a link to their presentation at Denver today. Registration is easy. You can click on the companies listed for audio with slide show presentations.

http://events.onlinebroadcasting.com/denvergold/092407/index.php?page=redirect

Here is what Hugh Cleland, one of Canada's top fund managers says:
Western Goldfields: Actually, this one has held up better than most. From a June low of about $2.08, it hit a July high of about $3.10. It was quite a rude shock, however, when I saw a number of market-sell orders (probably margin calls) take it down to $1.75 within 20 minutes of the open on Thursday, August 16, 2007. (August 16th has been the bottom to date.) It closed Friday (the next day) at $2.44. Six features of Western Goldfields continue to make it a core position:
1) World-class management, starting with Randall Oliphant, former CEO of Barrick Gold. Randall convinced a top-notch mine-development team to join him from Barrick, including President Ray Threlkeld.
2) World-class resource: The NI43-101 resource now stands at close to 4 million of proven and probable gold ounces.
3) Location: continental USA means no political risk, and its fully permitted.
4) The company is fully financed to production, including all necessary debt and equity. (i.e., the only way to acquire shares now is in the open market.)
5) Management is exceeding expectations, having recently announced that the mine will be going into production in January 2008, 3-4 months ahead of the previous guidance. (That almost never happens in the mining industry…)
6) Valuation: with the mine going into production in January, Western Goldfields is in the process of being re-rated from a pre-production multiple of ½ times NAV to the 1 to 1.5x NAV multiple that a producer gets. Bottom-line: with an NAV in the $4-$5 range (depending on the assumptions you want to use), the stock should be in the $4.00 to $7.50 range by February 2008, only six months away.
http://www.northernriversfunds.com/assets/downloads/Cleland%20-%20July%202007%20.pdf

Here is Peter Hodson of SPROTT management on BNN TV Scroll down to the 7:30 time period. He talks about Western in his top picks a few minutes into the segment:

http://www.bnn.ca/shows/past_archive.tv?day=thur

Bill Cara's piece but his website has a lot more:

January 30, 2007
Another junior goldminer candidate, Tues., Jan. 30, 2007, 3:25 PM
Today we celebrated Scotland's favorite son, Robbie Burns, with a dish of beef stew, shortbread and haggis. Ray Threlkeld of Western Goldfields provided the lunch and the entertainment.

Entitled "Introducing a Unique Investment Opportunity," Threlkeld went through the usual presentation. My conclusion: what's not to like.

Here are the bullet points:

* Projected 9.5 years annual production of 165,000 oz. gold, starting (full prod.) April 2008
* Cost of sales of $335/oz
* All-in costs of $414/oz
* After-tax IRR est. to be +13 pct @$500 gold; +25 pct @600 gold; and +35 pct @$700 gold.
* Fully funded, fully permitted, and situated in Southern California with a grandfathered environmental permit and an environmental partner in Los Angeles County that needs their fill to cover disposed waste
* World-class resource with completed resource estimate of 3.61 million oz gold and a completed feasibility study for mining 2.36 million oz gold reserves.
* Additional resources are likely with drill results to be reported in February
* Conventional truck and shovel mining with run-of-mine heap leaching
* Politically stable environment " about 120 miles east of San Diego CA and 45 miles northwest of Yuma AZ.
* Outstanding management team that will likely build a success here with this property and use the shares to acquire similar properties for the next several years
* Completed a C$70 million financing a couple days ago, done overnight
* Arranged a C$105 million project debt financing in Nov-06
* Low $286 million market cap capable of expanding by a factor of three after the expected analyst rating upgrades
* Property called Mesquite was acquired from Newmont for 3.5 million WGI shares (ie, less than 10 pct) plus Net Smelter Return of between 0.5 pct and 2.0 pct. Newmont holds additional warrants to purchase 6.1 million shares

Why do you buy the shares of a goldminer? As Threlkeld says, it's because of (i) the resource (ii) management, and (iii) the price of gold. This one is a winner on all counts. I don't think WGI.TO will be trading at a low price for long.

The resource has already produced about 4 million oz of gold at an average cost of sales of less than $200, but was suspended by Newmont in 2001 due to low gold prices. But Newmont acquired expansion permits and grandfathered the mining rights before selling the resource. Another management team failed to do much, and present management stepped in recently (less than a year ago) with financing and a solid track record of success in the gold mining business. This is basically an old mine with a new story. I happen to like the story.

Chairman is Randall Oliphant who until 2003 was CEO of Barrick. CEO Threlkeld was formerly a senior officer at Barrick. Paul Semple and Wes Hanson have a track record of success in the industry, and CFO Brian Penny formerly held that position at Kinross.

Gold prices at this level will generate a substantial profit.

The stock trades on the Toronto Exchange (WGI) ($2.35) and in the USOTC market (WGDF) (US$1.96). I would expect a full U.S. exchange listing soon.

Until I get a better feel for the company, I will set a 12-month Price Target (PT) of C$4.00 (US$3.50). Should gold prices move higher, I will not hesitate to set a higher PT. This one is worthy of looking into. I will follow it closely here in the blog.

http://www.billcara.com/archives/2007/01/another_junior_goldminer_candi.html

I am way long WGDFF/WGI.to. It had everything I can find that I want in a stock. Location, it has 4 million ounces of gold, it has world class management, they have exploration upside, they have connections. They are pouring gold now but full production starts January 2008 or sooner.

Here is something I am guessing at first time today. If you listen to the Denver show presentation Ray says WGDFF has moved new ore onto the old leach pad and started leaching. Further on during the question answer preriod, I believe, he mentions the time involved in the leach cycle. Two months. Seems to me the first gold pour will be by Thanksgiving.

http://stockcharts.com/def/servlet/SC.pnf?chart=WGI.TO,P&pref=G

Of course we know how erratic those P&F charts are. So buyer beware.

Thanks for your posts here (and a more pointed one on the "other Forum"). I'm almost convinced to buy some! (Yes, you're right on the "other Forum": BN.V looks good in Miningpedia but it's a dog. Share price has gone nowhere)

studbakr I enjoy posting here. Hopefully we can get a more active crowd. Right now I own only two stocks. So most of my comments on things may be negative so not sure about that. But I am negative on my own picks too. LOL.

I am open to new stocks. I am looking for current or imminent production. Gold the primary metal, silver second and base metals down the chain.

Decent sized reserves and good exploration potential. Safe location. Recognized management.

I own USA silver. Great new company, long time mine, good management at the mine level and maybe all the way to the top. High grade silver, recent excellent exploration results, in the US, etc. The negative: It has been a low margin high cost producer in the past. Now a new mine plan. Seems to be bringing costs down dramatically. Too many shares out. When I bought the Coffin brothers of Hard Rock Analysis said there was going to be a 3:1 reverse and I wanted that but did not happen. But hey still a good double IMO. Sorry no 10 or 100 or 1000 bagger promised. LOL.

A lot of hard core metals people hang out on SI on a thread I run and one other one an associate runs pretty good IMO.Some experts in the field post frequently. Not too many primadonnas and nothing like what we just saw on the other thread. Whoa.

Others stocks on the potential list are POM, MMG, PAT, RIC, WDO, CKG.

golden7 wrote:

A lot of hard core metals people hang out on SI on a thread I run and one other one an associate runs pretty good IMO.
.

I just logged-on to SI after a long absence. You've posted "only" 24000 times in 6 years! Impressive!

I bought a few shares of WGI today

Golden

Thanks for the post on WGI. It sounds rather impressive and I will research it for a possible investment. As for SI, may I ask which thread you run? Thanks

Hello studbkr and letitfly,
Great day for WGI/WGDFF. No doubt a pull back coming. I did post some more over at the Ol hang out of Jason's just to keep the thread up to date that WGI is not going to hell because they had to hedge a bit of gold to get the bank loan. LOL.

Here is the thread I post at mostly. Good people there. I hope all visit. You too Bull! I do not allow the primadonna stuff or personal attacks. But if you know who showed up I may have to go on the attack. <G>

http://siliconinvestor.advfn.com/subject.aspx?subjectid=55997

Good thread. Thanks!

Comments re Wesern Goldfields from BMO
Western Goldfields Inc. (WGI-TSX, C$3.42)
Outperform (S) Target: na
Impact: Positive
• We visited the Mesquite mine on September 22 and found that the project is progressing well. The company has 200,000 tons loaded on pad and under leach. Operating costs are meeting expectations and capital costs are in line.
• Deliveries of some haul trucks have been delayed, although 11 of the planned 14 trucks are now onsite and in operation. The company had experienced a number of failures of Chinese tires and subsequently switched to a different, more expensive tire for the front wheel positions. The higher tire cost is expected to be largely offset by longer service life.
• Recent initiatives include shorter hauls for waste, begun scheduling Sunday shifts, rescheduling some pit phases and extending operator training. These efforts are expected to result in the company reaching its 2008 production guidance.
• Management noted that certain areas of the property remain open for reserve additions. Metallurgical studies are currently being undertaken to examine the potential of exploiting a large sulfide system underlying the Mesquite mine. The company is examining ways to improve the low gold recovery from the sulfide resources to make them more attractive targets. Management expects that approximately 150koz of inferred resources will eventually be mined. Other opportunities to increase resources are expected to come from exploration drilling in the Brownie area.
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At the time of this report dated Oct 1 (for the week ending Sept 28), BMO estimated that the Western Goldfields 2008 Earnings at $0.24 and 2009 at $0.21. That translated into a PE multiple then of 14.4 (08) and 16.4 (09) versus the entire sector average PE multiple of 28.9 (08) and 22.1 (09).
It appears from a BMO perspective that WGI (TSX) WGDFF (OTCBB) has a significant upside. I agree.
Their website contains the Denver Gold forum presentation, and is worth looking at.
http://westerngoldfields.com/s/home.asp
I am surprised that the application for listing on the AMEX is taking so long for approval. Maybe somebdy would care to comment as I don't think that would be possible by the Company.
Posted by: Bill Cara at October
http://www.billcara.com/archives/2007/10/caras_commentary_community_cha_41.html#more

Coming soon to Amex!

http://westerngoldfields.com/s/NewsReleases.asp?ReportID=270683&_Type=&_Title=Western-Goldfields-Approved-for-American-Stock-Exchange-Listing