Sorry for late reply havent been paying must attention to markets recently, or HC.
MML a very different kettle of fish...their project is a previous development, in other words, most of the resources were already predefined and plenty of the development done already with processing options already in place.
In other words, the CAPEx was pretty minimal...this is important because therefore any further expansion later, or now as it happens, did not require a 'doubling up' o amounts spent.
Was a great stock...one of my then broker's reccomendations, and wish I had listened to it.
DRM on the other hand, if they spent a large amount of CAPEX now developing a small resource, they might well find that they then have to go an spend it all again, when they find more resources, eg upgrading the plant etc.
There ARE some cases where it is more sensible to jump into production, for example a company with only one decent mining lease and little likelihood of finding any other neary deposits...but this is definitely not one of those situations.
IMO they will have well over 1 M oz of gold at some stage, so to create an immediate development for only 250G now would probably not be a good option, regardless of its high grade nature. They will tie in the Wilber lode with other nearby gold resources they find.
The other benefit of this will be larger annual gold production, and therefore fixed costs being spread over a larger number of ounces = higher margins and therefore higher profits.
Good to see SPP closing oversubscribed despite being only at a modest discount to the SP!
Cdchi1
DRM Price at posting:
$1.38 Sentiment: LT Buy Disclosure: Held
