Dublin-listed exploration group Ovoca Gold is set to become one of the world's largest silver producers, according to its chief executive Dr Barrie Oakes.

In June of this year, Ovoca acquired a 74 per cent interest in the Russian company CJSC Ayax, which owns the Goltsovoye silver deposit in Magadan in Eastern Russia. Speaking after the group's annual general meeting (agm) yesterday, Dr Oakes said that the Goltsovoye mine, which is considered the group's flagship project, is "potentially the world's highest grade silver mine".

Dr Oakes said the group now has the opportunity to become one of the top ten primary silver producers in the world.

He added that Ovoca's shares are currently "exceptionally undervalued", and observed that the market may be waiting for the completion of the "bankable" - an independent feasibility study - which he expects to be finished by early 2007. Ovoca shares are currently trading at €0.15, but Dr Oakes estimated the true share value at $0.50 (€0.39).

However, a number of shareholders in attendance at the agm were not as optimistic, and were keen to hear how Ovoca's original project at Kola Peninsula in Russia was faring.

Chairman Roger Turner said progress was slow at Kola as attention has recently been focused on Goltsovoye, and funds have been diverted from the company's other exploration projects to the Russian silver mine.

"If we want to change Ovoca into a major silver producer we can't take our eye off the ball and spend funds on non-essential projects," he said.

Mr Turner explained that $20 million - $30 million of drilling and exploration work had already been completed at the mine before it was acquired by Ovoca, and that this has "catapulted the company... maybe even five years ahead".

When questioned on the future of the group's Irish operation, which consists of the Newcastle West base metal prospect in Limerick, Mr Turner conceded it is "one project too far for us", and said it will have to take a back seat.

The group has no immediate plans for its Newcastle West licence, Dr Oakes said, but added that the company will be considering all options, including the possibility of a joint venture.