Lawrence Roulston Initiates Coverage on Andover Ventures
To view the official report please click the following link: http://andoverventures.com/_resources/Andover_Reprint_September_Instant_Alert.pdf LAWRENCE ROULSTONS RESOURCE OPPORTUNITIES Initiating Coverage Andover Ventures Inc. (AOX-TSXV) The following editorial is extracted from the September 24, 2010 Instant Alert Andover has a gold mine headed back to production and an advanced silver-base metal deposit, also with near-term production potential, both located in Utah.

The company also controls a large land position around those mines, with a major company now funding exploration in pursuit of large-scale deposits.

In addition, Andover holds a large base metal deposit in Alaska. The Andover story is complex and has evolved over a period of years.

Recent news signals that the pieces have come together in a way that makes this a good time to invest.

Few investors have kept up with the changes in order to appreciate the enormous upside potential this company offers. Andover acquired the Sun deposit in Alaska several years ago, while metal prices were low.

The company then accumulated a control position in a very old public company that controls a large property position in Utah.

The early stages of Andovers acquisition of shares in Chief Consolidated were tedious and involved some controversy.

The acquisition of the Chief shares spanned several years, trying the patience of most investors.

The company has now locked up 79% of the Chief shares.

To complete the acquisition, Andover must pay $700,000 in October and a further $2.3 million next September.

A separate deal requires payment of $3.6 million. The time and effort to acquire Chief was clearly worthwhile, as the Chief property covers the East Tintic mining district and hosts two near-term precious metal producers and exceptional exploration potential.

The property is in the same geological trend as Bingham Canyon, one of the largest copper-gold deposits ever mined.

Not surprisingly, the operator of Bingham Canyon is funding work on the Chief property to earn an interest in a portion of that property. Along with the exceptional exploration potential, the Chief property originally carried the environmental liabilities associated with mines that were operated in an earlier era.

Naturally, the liabilities hanging over the company kept investors away.

The liability was settled with some cleanup work and by granting the EPA access to a limestone quarry on Chief property.

The final obligation is payment of $225,000 a year over five years. Gordon Blankstein, the companys chairman and largest shareholder, has worked tirelessly for years to acquire control of Chief, clean up the environmental legacy, tidy up the balance sheet and bring in the major company partner.

His attention is now turning to development of the mining operations. Blankstein is a consummate dealmaker, with a long history of business success.

He played a lead role in building a couple of technology companies.

For several years, he has been committed to building Andover.

Bruce Riederer, president, has 35 years of mining industry experience in the US and Australia.

That experience includes exploration, development and mining operations.

David Lajack, a director, has nearly 30 years of mineral exploration experience, with much of his efforts focused on Alaska.

Davids knowledge of Alaska led to the acquisition of the Sun deposit, located in the Ambler District of northwestern Alaska. Work by a major mining company in the 1980s outlined an historic (non-compliant) resource at Sun that hosts 0.8 billion pounds of copper, 1.8 billion pounds of zinc and 46 million ounces of silver.

Work by the major included a prefeasibility study.

A substantial portion of the prospective belt on the Andover property has not yet been evaluated.

Andover is now assembling and re-evaluating the historic work with the objective of securing a partner to advance the project.

NovaGold holds a large portion of the geological trend, known as the Ambler belt.

Earlier work on the NovaGold property outlined an inferred resource that hosts 3.2 billion pounds of copper and 4.4 billion pounds of zinc.

The belt was largely idle for several years, until NovaGold bought out its major company joint venture partner.

That highly successful explorer is now advancing its Ambler project. The value of Andovers Sun deposit will be best realized by the company that ultimately develops the NovaGold portion of the district.

Andover does not plan to commit any resources to the Sun deposit.

In due course, investors will realize considerable value from that immense resource. The focus for Andover is the extensive property position in Utah.

Through its holdings of Chief Consolidated, Andover controls 16,000 acres covering the historic Tintic mining district.

Tintic produced 2.3 million ounces of gold, 250 million ounces of silver and 2.5 million pounds of base metals.

Tintic is located south of Bingham Canyon in a prolific metal belt. Kennecott, a unit of Rio Tinto, one of the largest mining companies, is the operator of the mine at Bingham Canyon.

That huge mine has produced 37 billion pounds of copper, more than any other mine in the world and it has another 24 years of production ahead of it.

Kennecott has optioned a portion of the Chief property, known as the Big Hill porphyry target.

The major can earn a 55% interest in the Big Hill portion of the property by funding a feasibility study.

Andover is now turning its attention to re-starting production from the Burgin and Trixie mines.

The Trixie gold mine is fully permitted, having last operated in 2002.

Historic resources (non-compliant) show 70,000 tons at a 0.71 ounces per ton gold and 8 ounces per ton silver.

A further block hosts 125,000 ounces at 0.2 ounces per ton gold and 5 ounces per ton silver.

The last drilling on the project, in 2001, encountered 10.6 meters grading 188 grams per tonne gold and 268 grams per ton silver.

That hole and other earlier drilling support the management belief that the resource could be substantially larger than the amount outlined by the previous operator. The mine has a shaft and several mining levels.

Andover plans to utilize the existing development to access the ore zones.

The company also controls a concentrator, located at the nearby Burgin mine.

That mill previously processed Trixie ore at a rate of 200 tons per day.

It contains crushing, grinding, flotation and cyanide circuits. The Trixie mine and Burgin mill are both nearly ready to go back into production and the company anticipates beginning operation within months.

They may secure a partner to gain the needed expertise and other resources to get quickly into production.

In the last month of production (February 2002), the mill produced 2600 ounces of gold.

If that performance can be replicated by Andover, the operation could produce in the order of 30,000 ounces per year.

That may not be enough to excite investors, but should generate significant cash flow to fund further exploration and development of the Andover property interests, in particular at Trixie and Burgin. As production gets underway, Andover will be working towards larger-scale and longer-term production.

Further drilling at Trixie will seek to confirm and to expand on the current resources.

Once the underground mining is operational, exploration drilling will get going from the underground workings. The most important aspect of Andover in the near future will be exploration at the Burgin mine.

Work by past operators has outlined five mineralized zones, including small zones with good grades of gold and/or silver as well as a large base-metal dominant zone.

The Burgin Extension hosts 1.48 million tons at 16 ounces per ton silver and 26% lead and zinc.

Another million tons with grades nearly as high are estimated in a non-compliant resource for the Sunshine target.

Another zone hosts another million tons of lower grade material.

The Ballpark zone has a non-compliant estimate (based on work in the 1980s) of 27 million tons at 1 ounce per ton silver and 7-10% lead and zinc. Further work is required to determine how best to proceed with Burgin.

The existing mineralized areas need further drilling to bring them to compliant resource standards.

At the same time, the company will be seeking extensions to the known areas and will test other target zones. Ultimately, the operation might involve a larger-scaled milling operation sized to the Ballpark zone.

Higher grade ore from the other zones could supplement the Ballpark material, resulting in a large-scale operation with a favorable grade.

That arrangement could result in a substantial mining operation. The Chief property in Utah also has substantial water rights in an area in need of more water.

The limestone quarry, now under control of Chief, has near term production potential.

In addition, there is geothermal potential on the property.

Management are working toward deals that would see the company gaining benefits from those subsidiary assets. The Andover share price was in a long slump, with the legacy issues in the forefront of investor thinking.

The stock is beginning to rebound as it becomes more apparent that the Chief deal is secure and the liabilities have been settled.

Accumulate whatever you can up to about C$0.35. It is only a matter of time until a more accurate and more up-to-date image of the company becomes more broadly understood.

That improved understanding should see significant gains in the share price in the near term.

Further progress on the various projects would result in further upside.
Price September 24, 2010: C$0.29 Shares Outstanding: 71.8 million Shares Fully Diluted: 82.8 million Market Cap: C$20.82 million Contact: Investor Relations 604-682-2168 www.andoverventures.com
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