Avion Gold Corp AVGCF

Canaccord blurb

[mtsuit]

Avion Gold* (AVR : TSX-V : $0.31), Net Change: -0.01, % Change: -3.17%, Volume: 1,082,550
The forecast didn't say anything about a little rain. Avion Gold provided an operational update, highlighting that they
produced 12,500 oz of gold in Q3/09. While this was a 14% improvement over the second quarter, production fell short of
Avion’s forecast of 15,000 oz of gold due to heavy rains and the subsequent mill shutdown. Cash costs were estimated as
US$710/oz. According to a Bay Street analyst the crucial point is that head grades have increased, meeting expectations, due to
more effective grade control practices. Resource grade is 3.6 g/t Au and the analyst expects that head grade will be up
significantly from the Q2/09 average of 1.99 g/t Au. The update also highlighted that mill performance is excellent with over
95% recovery rates. Management targets production of 20,000 oz in Q4/09 for a total of 50,000 oz in 2009. Additionally,
exploration results continue to be positive including 6.17 g/t Au (5.94 g/t Au capped) over 31.2m core width (19.1 m true width)
in in-fill hole S-09-26 at Segala Main. Avion's 2009 drilling program is nearly complete with approximately 100 drill holes
totalling 21,000 m drilled, of which results released have been released for only 16 drill holes to date. An updated resource for
Segala is expected by year-end as is a study to expand production to 200,000 oz annually. Canaccord Adams Senior Mining
Analyst Eric Zaunscherb believes as Avion demonstrates its production growth profile at Segala and Tabakoto, the company
will experience a re-rating with a significant impact on price. He also notes that the company’s expansion plans beyond Segala
and Tabakoto and intent to become a consolidator of West African gold production may be considered "blue sky".