Ann: Final Boda results - Resource estimation underway, page-19

day 4 with covid and getting better. hope I am over the worst.

Here is what I think is happening with ALK. First, I am not sure what was the strategy with the Boda drilling since the discovery hole as they neither drilled wide enough for me to accept their argument ( happy to be corrected but they started saying this in the last 12 months) were only trying to workout the size and the structure/extent of the system nor they drilled close enough to be able to release MRE (not close enough for indicated resource but close enough for inferred perhaps). And this caused for ALK to end up reporting massive exploration expenditure for Boda over the last 3 years but had nothing to show for.

For those following close ALK we all know it is not for nothing but for institutional investors ( and I think this is the segment ALK tries to attract and got feedback why there is no interest) it actually is. Institutional investors follow strict rules and they want to see measurable returns on the investment and for something the be measurable it needs to meet certain standards and to be accepted by regulators and the industry.
So, ALK spends around $40m (rough numbers) on exploring Boda, 3 years of active drilling and no measurable evidence they are onto something.
I know there is more to it and hence why I hold large number of ALK shares but I am saying this from institutional point of view - purely.

Now that ALK are probably looking to rise capital (either by borrowing from banks or issuing share or combination of both) in order to complete Tomie development and perhaps accelerate Boda they need to show the full value of the company in order to get favorable rates or issue shares at higher price (at min discount). And in order to do that they need to show they are responsible managers and are not burning cash on a project that has no legs as I am sure few financiers would ask the question why spending so much on Boda but have nothing to show (no resource) for?

Faced with such challenge ALK had to change strategy and go for quick MRE at an area that has highest potential to demonstrate viable mining operation. Now they target similar area at Kaiser.

Overall this is good and will drive share price higher but I suspect it was forced upon them rather than for management to come up with such strategy.
Now I only hope they continue to target zones where they can delineate a resource and do real wide exploration to get proper understanding of the extent of this system. So far I am yet to see them doing wide exploration to get better understanding of the extent of the system when for 3 years they barely ventured into Boda3 and not a single hole in Driell C, Finns and rest of the north-northeast/west parts - not a single RC or Diamond hole for 3 years (or thereabouts). So, what understanding did they gain about Finns or Driell or Comobella, Murga..

The way things work is one does surface geochemistry (if there is surface expression), geophysics, aircore drilling etc.. and the Geo team builds a theory that needs to be tested with proper drilling (RC and/or Diamond). If drilling results confirm the theory to be right (very seldom first theory plays out) then keep going or adjust the theory on the back of what was gained from the drilling and try again and again until things start to work or give up and accept there is no prospect at a particular spot.

But I did notice, in the last 12 months management had to constantly stress they were not looking to define resource and only trying to understand the extent of the system. To me, this meant few investors (or potential institutional investors) must have given the the hard cold reality that when you spend so much money you need to show some measurable results. Someone perhaps dropped Chalice for example who made discovery at around same time as ALK and managed to drill 7km long resource and get t around $3bn of Market Cap.

So, common ALK start punching few hole further north-north/west from Boda. Even if they show nothing, at least we will get better understanding of the system and has to be done anyway.

My thoughts (or speculation) only and this is no fin advice.