Its going to take some strong news to rally hard in today's...

Its going to take some strong news to rally hard in today's market and maintain those gains. Thick Jaegermister intercepts should do it. More 20-30m intercepts in the 0-150m depth range may do it. Confirming the amount of the exploration target that is inside a much lower conceptual pit shell like US$800/t might do it - if its still a good ton's number. The ore confirming potential for strong recovery rates might do it. Releasing information about iron grades and hopefully confirmation they are low might. Finding some wider high grade zone's might do it.

If you look at GL1's Feb 2023 scoping study their mining engineers identified a mining plan that would mine 18.91Mt of 0.92% grade material. This created good looking economics but included a rather high pit shell of US$2,500/t (SC5.5). TG6 would appear to have reviewed that scoping study along with others and noted that on their conceptual pit shell and on the exploration target modelling, 95% was inside the deeper US$2,500/t SC6 pit shell. If TG6 hit the upper end of the exploration target of 20.1Mt they would be delivering 19Mt @ perhaps 1.3% inside a pit shell of US$2,500/t. Before getting to more technical elements, TG6 has a deposit that's on par (or better) with key elements of GL1's last Manna scoping study. It looked like a good plan.

The first problem is that the market is worried about high strip ratios leading to high costs and those costs potentially being too high for a project to be economic. A US$2,500/t pit shell doesn't remove those concerns and instead creates doubt that this is the sort of cost structure needed to enable mining of the deposit. Unfortunately there's more investors out there that confuse average costs and maximum costs than you would think.

The second problem is that IMO some of the deeper extents of Burmeister are likely to be cheaper to UG rather than open pit mine. Trying to define the best UG mining targets with a high strip ratio open pit mining constraint doesn't sound like the most sensible strategy. If it however has TG6 drilling out more of the previous RC22 / RCD24 intercept of 19m @ 1.52% / 17.8m @ 1.66% then I'm happy with it as a stepping stone as I think that ore should have good economics one way or another.