Not a very encouraging read.Some points from the 17 page...

Not a very encouraging read.
Some points from the 17 page Material Change Report, which supercede disclosure in the Company's Annual Info Form from YE 31/12/10, that concern me:
Total mining area (FTAA) reduced from 370km2 to 158km2.
Upon commencement of commercial production, there is a period of 5 yrs whereby the company can recover all pre-operating expenses. After this time, 60% of net profit (net of all taxes, local payments, govt. payments etc) is payable to the govt. as a govt. share!
Grades average 1 gr per tonne equivalent gold grade - not exactly high mineralisation for a mine which is very inaccessible for access and power. (power is via diesel generators, exposing cost increases along with increase in price of diesel).
Mineral reserves - open pit - Proven au 0.71 Moz (+.55 Moz Probable). Underground Probable 0.43 Moz. Total Proven and Probable is 1.68Moz.
Now, the interesting thing is that they are quoting first 4 years of mining is open pit only, and targting 200,000 ozs pa. (note only have less than 800,000 oz proven at this stage). This is in contradiction to the table provided of total gold to be produced (p 13) for years 2013 - 2016 incl of 76,500 oz, 93,300, 104,000, 96,700 ozs (not incl copper credits)???.
First 4 years open pit targeted production of 800,000 ozs leaves approx. 880,000 ozs over the 17 year life of mine from total known resources for both open pit and u/g mines.
Would be happy for someone to provide an alternative view. I bought yesterday, and sold this morning based on this news. Main trigger was the news that the Government gets 60% of the profits. I can't justify risking an investment where as a shareholder, I am entitled to my share of a return on just 40% of the profits, with the local Govt getting 60% and no risk to them! And we think we are hard done by in Aust. with the MRRT.
Took at $560 loss - but happy to be out and move onto another gold miner with more reliable prospects and current earnings.