$100,000 cash compared to around $20mill cash on completion of cr is currently very easily affordable for what is prospective ground so close to high grade outcrops such as Vampire. There is clear potential to find surface ounces and with the plant at OP, it won't take much surface gold to make the $100,000 investment look like a great move. Even only a very small surface deposit of around 5,000oz with a margin of around $700/oz would be enough to generate a profit margin of $3.5mill. That will return multiples on the $100,000 up front plus any low cost surface exploration expense. If they find a reasonable size deposit and then decide to spend more on exploration, the returns could easily move into the tens of millions. Say $1-2mill spent to prove up a still quite small 20,000oz near surface deposit with the same $700/oz margin would see a return of $14mill less the $100k plus possibly $1-2mill exploration. The $100k starts to look very insignificant if anything at all is found.
ABU Price at posting:
2.2¢ Sentiment: LT Buy Disclosure: Held
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