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By John Helmer in Moscow

The latest in Russian checks on penny gold stocks ABV Gold and Aurus fail to support gold resource and other claims made by the companies concerned.

Following Mineweb’s previous reports on the companies, fresh announcements from ABV Gold and Aurus have had mixed impact on the US over-the-counter pinksheets market.

On January 25, Aurus issued a statement advising shareholders not to believe what they have been reading in Mineweb:

“NEW YORK, NY–(Marketwire – January 25, 2008) – Aurus Corp. (PINKSHEETS: AURC) must once again answer allegations that are unsubstantiated and opinionated. This matter refers to an article written by John Helmer and released on Mineweb. The Board is meeting with its attorneys to prepare a news release to address the statements and insinuations of Mr. Helmer. The news release shall be issued on January 29, 2008.”

January 29 passed calmly, and no news release has followed.

Aurus has continued its year-to-date decline, dropping 6% in Tuesday trading to 1.7 cents:


ABV Gold (also listed on the OTC pinksheets market) has followed the same trajectory, falling 5% on Tuesday to 0.1 cents:


ABVG has enjoyed a brief pickup on trading of almost 15 million shares. This appears to have followed company announcements suggesting new asset value in Russia.

According to one announcement, dated February 6, and signed by Daniel Ryan in Montreal:

“MONTREAL, Feb 06, 2008 (MARKET WIRE via COMTEX) — ABV Gold Inc. (PINKSHEETS: ABVG) (FRANKFURT: AB8), a gold and other precious metals mining company, announced today that Enzo Vettese has been appointed to board of directors ABV Gold Inc.

Mr. Vettese is the president of Narrow Galaxy Inc., a company that operates in Russia. Narrow Galaxy has many interesting business relationships in Russia that could bring financial benefit to all shareholders.

“Narrow Galaxy Inc. has great insight into the business community in Russia and we look forward to their input as we negotiate additional deals,” said Daniel Ryan, President and CEO of ABV Gold. “Narrow Galaxy Inc. and Enzo Vettese are key to our success.”

NOTE: Narrow Galaxy’s Russian office is located at Russia, Moscow 105 120 St. Segea Rodonazhkogo, Building 6, Unit 12.”

A second announcement appeared, and then disappeared almost as swiftly from this link:http://www.redorbit.com/news/business/1076900/abv_gold_inc_closes_acquisition_of_a_70_interest_in/index.html

ABV Gold intimated that it was holding two gold-mining licences, ABN#00363 and ABN#00362, and that “we have agreed to buy a 70% interest in these mining licenses. The mining claims are currently in production and lie in close proximity to properties owned by Kinross Gold Corporation.”

A third announcement from ABV Gold, also signed by Ryan, followed on February 8:

“MONTREAL — (MARKET WIRE) — 02/08/08 — ABV Gold Inc. (PINKSHEETS: ABVG) (FRANKFURT: AB8), a gold and other precious metals mining company, is pleased to announce an agreement has been signed for the acquisition of a major forestry project in the Republic of Khakassya, Russia. The LOI has been signed with Narrow Galaxy Inc.

The project calls for the exploitation of 14 million cubic meters of wood on 175
thousand hectares of woodlands. This figure is calculated by North American standards @ $10 per cubic meter multiplied by the confirmed 14 million cubic meters of wood on the property resulting in an asset value of $140 million USD. Narrow Galaxy Inc.’s concession was signed 17-10-2006, under document number N1124, in the Republic of Khakassya, Russia. The concession is for a period of 49 years.

Narrow Galaxy Inc. is in negotiations to purchase a sawmill operation located in Quebec, Canada. This sawmill facility is being purchased from a major Canadian forestry concern and is slated to be relocated to Khakassya, Russia. This sawmill is presently milling 125,000 MFBM (million board feet ) per year @ an estimated cost of $298.07 per thousand board feet. Narrow Galaxy Inc. estimates the relocated sawmill equipment will mill the same amount of wood at a cost of $101.92 per thousand board feet. The company expects a sale price of $185 per cubic meter in first 24 months of operation based on North American sales price forecasted for 2009 by RISI North American Lumber (http://www.risiinfo.com/ ). This sale price would result in first year gross revenues of $43 million USD and EBITDA of $27 million USD.

Narrow Galaxy Inc. anticipates having its financing in plan in the next 45 days to carry out its business plan. Narrow Galaxy Inc. and ABV Gold Inc. plan to update the market on a timely basis on issues relating to the sawmill project including management changes, funding, production schedule and export contracts.

“This forestry project was brought to our attention by Narrow Galaxy Inc. when they brought our initial gold deal in Khakassya, Russia,” said Daniel Ryan, CEO of ABV Gold Inc.” As shareholders will recall, we press released an acquisition of a gold property in Russia on September 24, 2007. Acquiring this project, which lies in close proximity to our gold project, was a natural fit. ABV Gold Inc. will move quickly to spin-out this new project in a new public entity to be called ABV Resources Inc. This new entity will be traded on the pinksheets. This process will begin next week. ABV Resources Inc. will have a separate board, management team and financing arrangements. The plan calls for a one for one dividend of shares in the ABV Resources Inc. for every shareholder of ABV Gold Inc. The company will address a schedule for the spin-out in the coming two weeks.”

Furthermore, Mr. Ryan stated, “Shareholders can also expect more management and board of director changes for ABV Gold Inc. The company is in the midst of negotiations on several business ventures. I was brought in to structure a viable business profile for the company and we are close to completion. I think shareholder patience could be rewarded in short order. I will be handing over the reins of the company to the new management group as soon as everything has been finalized. We have gone out of our way to focus on the long term and we expect that real value will finally be realized. The spin-out and re-org of ABV Gold Inc. should be well received by the market once it is completed. NOTE: Narrow Galaxy’s Russian office is located at Russia Moscow 105 120 St.Segea Rodonazhkogo, Building 6, Unit 12.”

Verification by Russian officials indicates that Narrow Galaxy is registered as the representative office of a foreign company, and was registered as such with the Russian State Registration Chamber on October 16, 2006. Foreign representative offices cannot hold gold licences directly unless they compete in open auction for them, or unless they hold them through companies registered in

Repeated mention of Narrow Galaxy’s Moscow office address was checked. The details of the street and building are confirmed, and tenants at the address include a well-known insurance company, a furniture company, a bank, and an enterprise called Tubus-Plast-Invest. No unit-12 exists in the address register, and no sign of Narrow Galaxy.

Khakassia is a regional republic in central Siberia. Ryan has told Mineweb and the market already that the two gold assets ABV Gold has rights to develop are held through two Russian registered companies, Kamzas and DRSU, which “maintain legal addresses in Kransnoyarsk county, Nagarov city, municipality Promyshleny Uzel. Kamzas is licensed to extract gold in the Balyks River Valley, located in the Republic of Hakasiya, 10 km East of Balysk. The areas are located near the villages of Balyks, Neojidany (sic) and Nikolaevka in the Republic of Haskasiya. The region 1.5 km Southwest of Neojidanny (sic), the Magazinskaya section, is located in Balyseen and unifies a few gold-operational zones and gold fields. This are of the licence (sic) is connected to the right shore of the valley in the upper part of the river Magazy and on the right shore in the lower part of the valley of the river Kamzas.”

The regional subsoil licensing agency, Rosnedra, confirmed that the two mining licences

ABN#00363 and ABN#00362 exist. Valeriy Kyargin, chief of Khakassia Rosnedra, told Mineweb that licence 00362 is on issue for alluvial mining; the licensee is a Russian company, OOO Kamzas. The state record of its reserves shows category A plus B proven at 300 kilograms (9,645 oz). Kyargin said he had no indication of any production at the site. License 00363, he said, is not a gold producer. It has been licensed also to the Kamzas company, but it is classified as an exploration prospect, with state reserve category C2 of just 53 kilograms (1,704 oz). In all, the two Russian assets identified by Ryan have a total potential gold resource of just over 10,000 ozs. These are “tiny, tiny objects”, Kyargin said, “but because they are they are alluvial deposits, there may be inaccuracies.”

Russian state forestry administrators in Moscow told Mineweb that adoption of the new federal forestry code at the start of 2007 tightened up all concessions awarded under the old regulations. New-order agreements have been required since the start of last year, and this means, officials say, that the New Galaxy concession reported by Ryan — dated October 17, 2006 — is no longer valid. It must be reviewed by the regional authorities; new agreements must follow competitive auctions.

Zinoviy Yuskiv, deputy head of the State Forestry Committee in Khakassia, told Mineweb: “I have been working here for 25 years already, and we didn’t issue a single forestry concession to date. I am sure we never issued any concessions to Narrow Galaxy company or its representative in Russia. More than that – I am sure the federal bodies didn’t do that, because they would inform us in that case. We are the ones who control the forests, and we know if Moscow issues something – we have to supervise it.”

As to the new legislation, there are no new concessions to be issued, only auctions.”

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