Ann: $6.5M Farm-In Joint Venture & Investment from Dampier Gold, page-4

A lot to digest here and consider whether it is actually a good announcement. At first glance,there are some positives and negatives but overall a very favourable outcome for us IMO.

Negatives

I always hate an after hours announcement, especially before a long weekend and after a week an half delay on when it was promised to be announced. If it is such a positive announcement why wait for 5:30pm on a Friday afternoon to announce to market. It could be at the request of DAU - I think we are definitely getting the rub of the green with the farm out. They are taking all the risk...

A sale/farm out to NST would have gone down better than to another 2 bob gold junior who does not have big end of town success or management experience.

Another cap raise $500k at 1c.

Positives

At the moment the assets are effectively locked up with no cashflow to bring to market. This certainly provides a capital injection at someone else's (DAU) risk. You would think that DAU expects to get at the very very least 20 times their investment back with future sales, and by keeping a 25% and 50% interest in the 2 respective assets, we will conservatively achieve at least $25M on this basis. That is 5 times our current market cap without outlaying a cent or taking on any risk. We also have the option of buying back the assets if we so choose to as well at a later date which may work in our favour depending on the success of the development.

The $500k market cap strengthens our balance sheet and provides money for drilling and pursuing other dormant lazy assets on the balance sheet as well.

Conclusion

The announcement unlocks not only the 2 farm out interests but other dormant assets on the balance sheet. It is refreshing to see some savvy ideas by management of this company especially while gold is on a bull run and puts a range of assets to work without costing us any money albeit selling/giving away some equity.

It is also prudent to note that the share market is currently pricing these assets at next to nothing anyway. As such, we have everything to gain here in terms of profit and in turn market cap and nothing to lose as the assets are currently "priced" at bugger all.