Who’s buying and selling, page-673

Good to see there were no big sell downs today, that's 2 sessions. I'd say those particular sellers have finished. The biggest movements today were buyers buying at the Ask price. After being sold down to 18.5c by the big seller last week, it'll take time to come back to previous prices. No one wants to pay 21c when it's recently been at 18.5c

February was an eventful month, we had 2 big announcements in the one day. On top of that we had a few big holders exiting, probably taking profits. In all that I think the market forgot about our Resource upgrade, it got preoccupied with the perceived delay in the Macquarie announcement and maybe the 5% drop in gold price.

For the main pit to go from 1.3m oz to 2.2m oz is almost an extra million ounces. Most companies would kill to just have 1 million ounces. On top of that the grade went from 1.2g/t to 1.6g/t a 33% increase. And further a bit over 1m ounces went from inferred category to indicated category. So we have a million oz we can mine without drilling a hole, and a bit more infill drilling to move the remaining Inferred to Indicated category. That is an amazing result totally overlooked by the market. The Life of Mine has just almost doubled, 5 years based on the indicated resource, 10 years including the inferred (based on 4.5mtpa) they'll easily find another 1-2 million ounces at Morila, probably a lot more. Then there's the 685 sq km of some of the most prospective country in the World.

Also forgotten in the Resource statement was our operating costs. They clarify this cost as being the actual plant operating costs from the December Quarter + actual mining tender prices. So in other words a very exact cost.

The cost was US$22/t in oxide and $23.50 in fresh rock.
Based on name plate production of 4.5mtpa the total cost would be US$99m and US$105.75m for fresh rock.
At Morila's average grade of 1.6g/t, they would produce 208,360 oz (yes that's a lot of gold)
That works out to a cost of US$507 per ounce (cheaper for oxide), This would be for what the World Gold Council call Adjusted Operating Costs, it includes basically all expenses at Morila, royalty/production tax, G&A, stripping costs, even the chickens etc.

To get AISC add in Head office G&A, sustaining exploration, reclamation & remediation costs, sustaining capital expenditures.

Now this would be a very low AISC compared to most gold producers, probably why Morila was one of the lowest cost mines in it's day.

A bit like Goulamina, it'll take a while for the market to catch up with this upgrade, just makes our market cap look even more ridiculous.