Ann: Sale of Troilus Gold Corp Shares, page-34

@UndR8ed Cat


Again a large part of OTA is for financing downstream projects to completion.
IE we have locked in contracts for the purchase of what our project will produce.
They then need a source of funds to bring the project about so for example through banks.
I assume the banks then assess the validity of the contract before handing over debt to progress projects, potentially some or all of the finance could be through a government if it saw the project as paramount or finally equity through investors.
Where has the bulk of the NAL project came from? We have zero debt so assumingly have sourced the money for our projects from eithe government or more likely with current register via Equity interest.

It paints a horrible picture as now one has to ask if it would be OTA by usual standards, worthy if no bank funds have flown into it.

As for being forced to buy stuff they dont need.

Wouldnt the basis of you entering the contract be on your future earnings on a conservative basis along with putting in place caps to help de-risk the arrangement be enough?

Why should SYA the majority owner of NAL and operator of it via SYQ set up an OTA when basically (under certain market conditions) nul and voids it? Why write one up at all if it again under market conditions wont mean anything?

My understanding is when the 2 parties enter into the OTA the buyer would set the caps on their deemed hedge of risk. IE we can still make money out of it at $400 US/ton so even a cap of $500 US/t will allow it.

Seems like a horrific OTA if thats the case suited to one party entirely. ie happy to cap us at a price ceiling and take all production when we are at 5000 us/t but prepared to drop the entire OTA when the market flops, seems a bit stupid doesnt it. Why would SYA BoD sign off on that?????