Having been one of the many who got their fingers burnt with CTO, I would be very happy to see NMR get Black Jack up and running, and doing so profitably.. CTO spruiked their 10 million ounces and the network of tunnels under Charters Towers which would make us all very rich, but unfortunately they had neither the capital nor the management capability to capitalise on what was admittedly a large gold deposit.
The quite dramatic increase in the gold price has made the Black Jack/Far Fanning project a potential source of considerable riches. With good management, I think that we'll at last see the project becoming profitable and producing considerable free cash flow much sooner than many people are expecting.
Although the $18.9M looks quite expensive, it includes the valuable gold resource at Far Fanning, and as others have alluded to, the fact that Black Jack will be the only permitted operating plant in the area means that they should be able to supplement their cash flow significantly with toll treating ore from other producers whenever the plant has spare capacity.
The $18.9M is to be repaid over a period of 33 months, which should not be too onerous.
NMR is one a a group of small explorers becoming producers which will benefit substantially from the gold bull run.
NMR Price at posting:
5.4¢ Sentiment: Buy Disclosure: Held
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