Again Ian Riley has reported what he has been told with again few typos including note references.
They hope to get around the subsidiaries negative equity problem by writing off the $6.281 million AUS$ invested so far into the Moura (Konkoutou and Kawsara sites) part of the project. All exploration to date. Definition in accounting, an impairment charge describes a drastic reduction in the recoverable value of a fixed asset. Impairment can occur due to a change in legal or economic circumstances, or as the result of a casualty loss from unforeseen hazards. Given what possible other options Management had to rectify this problem it appears clear to me that they have thrown this production expansion opportunity on the scrap heap for the time being. This does not surprise me though given all the problems they seem to be having getting Makabingui' 1 st stage up and running.
As far as the ASX queries go I believe their major concern is again highlighted in this report. Current Assets 270,000 AUS$ vs Current Liabilities 24.260 million AUS$. And this is the case only if the Senegal Government have come to the party regarding the contingent tax liability. Until it is reported by BSR that a formal agreement has been reached I would tend to believe the $550,000 AUS$ provision is just yet another estimate from Alex.So BSR owes approximately 24 million AUS $ and still has plant required for the plant upgrade either sitting on the ground or in the process of being manufactured in 4 to 5 countries through out the world.
One of the main attributes of a good management team is the ability to get things done on time and on budget. Sadly, this Board has proven time after time this is definitely not something they are familiar with.
It is my view that only a complete lunatic would invest any more money into BSR if any existing Board member remained. They have clearly had their day and to achieve what they have so far do appear to have diluted our control over the project considerably.If we ever hope to get over this continuing liquidity problem I believe it will be through additional share allotments not the production of 2,200 ounces. Who exactly knows where that is at? I would have thought management would have taken the opportunity to update us with this report. Then I said to myself are you kidding!
It is now time for some new blood. The sooner the better. Even if it is to get a clear picture of what capital and time is required to get the project and mine to it's original full capacity goal. Maybe Mincores bankable feasibility study was just full of shit, as it now appears to be. No way I would be asking them or the current Directors for that matter.. I would need some honest independent appraisal of the whole situation before BSR got another $1 of mine. In this industry maybe that is just a pipe dream.
As far as I know WATIC do not have to contribute anything until the mine goes into production. Up until that point of time we pay for everything and they will eventually pay us back their share. What this is likely to be is anyone's guess given BSR has no real control over MGO which now owns all the projects assets, and will account for all operating income and expenditures. How much did that Laptop cost $50,000.00. Geez prices certainly have gone up in Senegal.
BSR Price at posting:
1.3¢ Sentiment: Hold Disclosure: Held
