Asanko Gold Inc. has been one of the biggest mining success stories in West Africa. The Toronto-listed company had a market capitalization of more than $1 billion as of Wednesday morning. And hedge fund K2 & Associates Investment Management Inc. thinks it could drop by more than 90 per cent.

In the grand tradition of short sellers, K2 has set up a website to allow the public to download its report.

K2’s main allegation is that Asanko’s gold resources at its Ghana-based mine are far lower than the company reported. The hedge fund claimed that the project’s previous owner, Resolute Mining Ltd., said the ore zones becomes “thinner and more discontinuous” deeper underground, whereas Asanko’s reserve estimate implies that they “expand dramatically.”

“The company’s current resource estimate contains (six times) more gold ounces than the previous miner’s stated resources before they forfeited the asset,” K2 said in the report. It believes current resource estimates “appear over-inflated” by a factor of two.

The 42-page report contains detailed analysis of Asanko’s drilling results as K2 tries to make its case.

The Toronto-based hedge fund believes Asanko will struggle to meet the production estimates in its plan, and will have to reduce its reserves. It said the miner has “numerous buffers” to prop up its near-term production numbers, but they are ultimately not sustainable.

Asanko shares were down three per cent in early trading Wednesday.