Andrew Racz
Director of Research
300 East 54 Street, Suite 26C
New York, NY 10022
Phone: (212) 319-6949
Fax: (212) 753-1944

Olympus Pacific Minerals, Inc.

February 28, 2008


OYM - Toronto
OPG - Frankfurt
Warrant - YM.WT




52-week range:

$1.20 - 39¢

Stockholders' equity:


Fully diluted shares:


Trading warrants:


Olympus Pacific is a gold exploration and already emerging gold producer in Southeast Asia. The company has a site in Bong Mieu and Phuoc Son in Central Vietnam, and the Capcapo gold property in the northern Philippines. In Vietnam, the company has two projects, Bong Mieu and Phuoc Son. Bong is already producing 10,000 ounces of gold per annum, and Phuoc Son is expected to produce by mid-2009 at an estimated production rate of 60,000 ounces.




Per-share (¢)

June 2008




June 2009




Such calculations refer to $1,000/ounce.

With $1,500/ounces, the initial phase could produce 4.5¢ per share; that OYM is selling ten times two years forward revenues.

Additional production in Vietnam and the Philippines is expected to produce an additional 100,000 ounces in four years, bringing the total to 150,000 ounces.

150,000 ounces per year is $150 million in revenue per year ($1,000/ounce).

The market value of OYM is about $135 million. Thus, OYM is selling less than one year gold production.

In order to place Olympus in the international gold market, the following factors are to be established:

a) At the various gold prices, the company can achieve a revenue stream of

$150 million a year when the price of gold is $1,000, $225 million when the price of an ounce of gold is $1,500, and $300 million when the price is $2,000.

The company has 275 million shares. The following table is of interest:




150,000 ounces

Gold price




Estimated profit


Shares outstanding


Per share


It is one-time net income . . . and it is not a small company.

Basically speaking, the company only needs about $25 million capital expenditure to achieve the above aspirations. With the current market capitalization of about $150 million, in four years' time the total revenue would be greater than the current market valuation of OYM. What if the price reaches $2,000?




150,000 ounces

Gold price




Per share




Value can be anywhere between $5.00 and $10.00.

The subsequent cash flow over a period of five years could be as high as $1.0 trillion, which is about ten times higher than the current equity value of Olympus Pacific Minerals, Inc.

Operational Summary

Olympus operates in a geographically virgin territory in Vietnam and in the gold-rich area of the Northern Philippines.

There are three basic segments: Phuoc Son in Vietnam, Bong Mieu in Vietnam, and Capcapo in the Philippines.

Olympus is a believer of large exploration budgets as it permits the company to explore a large portfolio of tenements. Apart from continuing to develop the above three territories, it is constantly exploring territories. The newly discovered explorations have hidden economic value.

The gold targets by property are as follows:


3-7 million

Phuoc Son

2-4 million

Bong Mieu

1-3 million

Olympus is poised for significant gold production, as illustrated earlier, but what is equally important is further exploration discoveries within the most economically productive mineral provinces.

The Team

Employing over 400 employees in Southeast Asia and drawing its key personnel from a worldwide base, Olympus has an experienced management team with a globally proven track record in gold mining and exploration.


Olympus has been successful in raising funds to meet its aggressive exploration targets. Up to December 2006, funds were used predominately for drilling programs at Bong Mieu and Phuoc Son. As of January 2007, Capcapo Northern Philippines has been added to these two projects.

Once the Phuoc Son project commences production in late 2008, it is fully expected that the company will be self-sustaining.


Olympus is producing and shipping gold from its Bong Mieu demonstration plant. The company is planning construction of its second gold plant at the higher grade Phuoc Son property. Completion of the Phuoc Son gold project is estimated to be 18 to 24 months after approval of the Phuoc Son feasibility study, which is near completion. Annualized gold production at Phuoc Son will be targeted at some 60,000 ounces.

There is potential that additional production will commence in Vietnam and the Philippines within the next five years that may take the annualized production to approximately 150,000 ounces.


Exploration success at Bong Mieu and Phuoc Son during the 2006 drill program was significant. A resource update for Phuoc Son was published March 7, 2007. Bong Mieu's resource update is expected by mid-2007. The budget for exploration activities over the next five years is projected to be in excess of U.S. $25 million, much of which will be funded from production.

However, the potential territory is unknown, but could be quite promising. With a possible cash flow of $1 billion to $2 billion in the next 12 years, Olympus is self-financing the entire Southeast Asia. Ho Chi Minh was right. Vietnam will be rich, rich in gold.

Nevertheless, the Olympus Exploration Portfolio includes a number of highly prospective large-scale gold and gold-copper projects in provinces of Vietnam, Laos and Cambodia.

Given the monetary reserves, the exploitation of the new territories can create a major gold-producing company within ten years. OYM can emerge as a mining holding company by 2015. Nobody has drilled thoroughly the former "trouble spot" of the world.

One thing is clear: There is no more Hanoi Hilton, but maybe a Saigon Olympus will cooperate with Anglo-American.


The country is one of the greatest human stories of our time. Vietnam is densely populated with about 50 million people, and it had to recover from a devastating war. With a remarkable establishment of secondary industries, the economy is able now to absorb one million people in the labor force. It is targeted for an economic growth of 7.5 percent.

The GDP is around $60 billion per capital of 2,600 with a labor force of 46 million people.

Vietnam has oil. The production is 600 million barrels a day, and its exports total $50 billion. The public debt is $25 million, and foreign investments are over $30 billion.

After 30 years of peace, the country has $28 billion foreign exchange and gold reserves. In fact, gold reserves for Vietnam are over 30 tons, one of the fastest growths in the world.

Vietnam technically has been at war since the beginning of the Second World War. As a result, its mineral resources are hidden, and the capital expenditure for geographic exploration has been limited.

Olympus is one of the first mineral exploration companies.

Apart from its current involvement, it is possible that the country's gold reserves are minuscule to Olympus's projected assets. This is, in fact, the wild card in Olympus. The company is an important factor in a country with one of the highest growth rates in Southeast Asia and is likely to explore other territories in Vietnam and in Thailand.

Lastly, we want to point out that if, in the coming decade, Olympus would have a surplus cash flow between $1-2 trillion, which is about twentyfold the current GNP, the surplus cash will be utilized to explore the mineral resources of Southeast Asia.




Accumulated Value



$150 million





$1,500 billion

Current Gold x current reserves

$28 billion

Thus, Olympus can be a dominant factor in a country that both France and the USA tried to occupy.

The Changing Fundamentals of Gold

Gold is the most widely discussed metal. The current most important monetary deposit, in fact, its real value is of prime importance.

I was sitting in December, 1974, next to the late William Simon, U.S. Secretary of the Treasury, who hit the table forcefully.

"We are putting gold in the commodity pages next to pork bellies,
because this is where it belongs."

Gold Consumption 2003





Bar hoarding




The world still believed that conventional demand, like jewelry, has the overriding force behind Gold.

I may have been the youngest person in the world who recognized the monetary value of gold. I was seven years old when the war ended, when there was hyperinflation in Hungary and my family every night added up the family's trading results in Napoleon gold and dollars. I was so fascinated that eventually I was banished from the table to attend to my school work. I knew, however, at the age of seven, that my family's relative property was due entirely to gold. By the way, we exchanged 12 dollars for a Napoleon compared to $1,000 today for an ounce of gold.

Had the Racz family stuck to gold in 1945, we would be billionaires.

How much is gold worth today? At $100 a barrel of oil, the Saudis sell at least 10 million barrels a day. This is $1 billion. In one year, it is $300 billion dollars. This can purchase, in a single week's production, 300 million ounces a year, or one million ounces a day.

Looking at the jewelry demands of Japan, which is 100 tons a year, the total Middle East about 50 tons a year, and the hoarding of the Chinese of 30 tons a year, a new picture for the amount of gold has emerged.

On the day of writing, January 24, 2008, the London market opened $25 higher per ounce. If we take the total worldwide mine production of 2,500 tons, the fluctuation of values is enormous.

According to the recent production schedule, the largest gold producers are as follows:

South Africa

400 tons


300 tons


275 tons


250 tons


150 tons

The top official Gold reserves are:


8,200 tons


3,440 tons


3,200 tons


3,000 tons


2,500 tons


1,600 tons

Compare it to the budget surplus of Russia, $500 billion; the Middle Eastern and Far Eastern countries, $600 billion. It is obvious that new elements have entered into the picture. In fact, the emergences of the Internet and hedge funds have acquired enormous power.

The hedge funds control $2 trillion. The largest gold ETF accumulated 700 tons of gold, almost one-tenth of the U.S. reserves. Within five years, the gold ETF's may have more gold than the official reserves of all countries combined.

Keeping this in mind, the possibility is on the horizon that sooner or later gold-related paper, equity or bonds will be marketed, and those numbers in a few years will amount to $500 billion. The demand picture will obviously increase the price of gold and lead to greater value for the reserves assets of a company like Olympus and the variation of such successful exploration companies will increase substantially.

A $100 million gold-indexed bond ties up 100,000 ounces of gold. Ten such offerings are equivalent to one million ounces.

Popularity of gold-indexed bonds – a wholesale buying – can trigger ten times more buying in ETF's.

This is a spiral that creates, in fact

Gold – as a currency

With an increasing price, $10 billion of new investment in gold creates monetary history.

Olympus's production, explorations, reserves and prospects are going to be reevaluated.


Information contained herein is based on data obtained from recognized statistical services, issuers reports or communications or other sources believed to be reliable. However, such information has not been verified by us and we do not make any representation to its accuracy or completeness. Any statement non-factual in nature constitutes only current opinions which are subject to change. BERAL INC. or their officers, directors, analysts or employees may have positions in the securities or commodities referred to herein, and may as principal or agent buy and sell such securities or commodities. An employee, analyst, officer or a director of BERAL INC. may serve as a director for companies mentioned in this report. Neither the information nor any comment expressed shall constitute an offer to sell or a solicitation of an offer to buy any securities or commodities mentioned herein. There may be instances when fundamental, technical and competitive opinions may not be in concert. This firm may from time to time perform investment banking or other services for or which investment banking or other businesses from any company mentioned in this report.



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Andrew Racz. 300 East 54 Street, Suite 26C, New York, NY 10022
Phone: (212) 319-6949 Fax: (212) 753-1944. E-mail:

Copyright © 2011 Andrew Racz. All Rights Reserved.