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Thank You Mike for that comprehensive report on 'being on the...

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26/10/21

13:51

Post #: 57080353
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Originally posted by mike999: ↑

ok, so after spending last week at Tarmoola here's a few of my observations. These are my views and musings only and people need to do their own research etc etc etc.....

Everyone knows there are three distinct businesses under the company, the gold exploration, the cattle station/camp and the civils business. My time there showed just how intertwined these three are and the benefits to owing the station. Plenty of hours in the car talking, eating breakfast and dinner with the crew and having a few beers around the campfire at night with them gave me a significantly deeper understanding of each of the businesses and the people behind them.

My random thoughts:

Exploration.
Obviously the gold exploration is their major focus. Plenty of drilling has taken place (I posted a couple of pics last week of the sample bags as far as the eye can see at a couple of the targets awaiting lab assay results) and vacuum auger is ongoing plus further RC at Tyrannus about to commence. The fact that many of the individual targets appear to be linked is genuinely exciting the geo team. I wont quote the ASX results announcements because you can read them yourselves but if these targets are in fact linked then do we have another KOTH? Only time (and plenty of drilling) will tell. The one thing that did surprise me, as the pics and maps in the announcements don't do it justice is how close to our projects KOTH really is and therefore the fact that their resource follows the fault into our ground would make sense.
We spent a day driving over each of the targets, getting a detailed commentary from the geo team and speculating on the next steps. My feel is we have so many promising targets but only a small team to action. The plight of many a small cap explorer.

Claudio's approach of using the low cost vacuum auger rig and pXRF the samples before committing to assaying and ultimately more expensive RC drilling appears to be paying off in both cost effectiveness, meaningful target identification and speed to drill proper.

Station/Camp/Civils business.
Joe, the new station manager, is an asset to us. Born and bred on stations and having run a number of stations for large mining companies over the years his knowledge was impressive. Nice guy too. First day we were there a number of road trains showed up to collect the old scrap machinery, cars, metal rubbish etc. About $20k into TNR's bank account that was otherwise would have sat rusting away as it had done for years before shows his eye for detail and a dollar.

Our geo team stay at the camp (we used to have to pay before we owned it) plus the drill teams pay us to stay there. Only 20 rooms at present but has approvals to expand to 50. Plumbing, septics, site clearance etc has all been done so only need more dongas and hookup of services to be functional. Decision on expansion will be made in due course. (the best photo opportunity I missed taking and posting here was of our exec chairman mopping and cleaning the dongas.)

Spent a day with Joe doing a bore/well run. Came across a number of drill crews operating. Stopped and introduced ourselves. Joe offered his services for future drill pads, clearing and rehabilitation via our civils business which was warmly accepted. (A major takeaway for from the week was mining companies are very conscious of keeping the pastoral station owners onside so give as much of their work to them as practical). One the the rig bosses asked if we were reopening the camp for accommodation bookings as he preferred his teams at camp away from town due to security issues and the temptation of pubs. (Had the previous owner given the impression of closure???). Assured him we were taking bookings and he confirmed his teams' next programs.
To the eastern part of the station we took a look at the trial pit recently done by Native Minerals (asx: NMR announcement 6/7/21). They paid $135k to the previous owner under an access agreement which shows that cattle stations can earn revenue from a number of sources. I believe RED5 still partially owe us under their agreement also.

Cattle were to be seen near many of the wells. Mustering to be commenced once the steel trap panels arrive on site and are set up. Plans to muster earlier were changed to allow the new manager to settle and then by rain storms limiting access.

Our civils business obviously now does the drill pads, clearance and rehab work we used to have to pay others to do. While I was there Joe had been quoting further work for RED5 plus other local mining outfits. My impression is that he has the knowledge and outgoing friendly personality that will win us plenty of work.

Went into Leonora one of the days and met with St Barbara management ( They have a number of operations on Tarmoola ground). Summers introduced himself and explained the TNR plans. They hadn't been using our civils operations but indicated they were more than happy to if Joe touched base. Explained they were currently evaluating reopening one of their dormant pits (closed back in the 90's when gold was $400 oz) so there may be some business synergies to discuss. Contact details were exchanged and meeting will be set up in Perth in due course.

I'll no doubt think of other things that were covered so may throw a few random HC posts over the next couple of days. Basically I came away very bullish. I lived in Kal for a few years many years ago so the area is not a new experience but i was pleasantly surprised at the significant activity in the Leonora area (amazing what a healthy gold price can do...). The KOTH construction project is an absolute beast and St Barbara are stepping up their operations so in my experience that means M&A including swallowing juniors will be on the cards.

And just to finish, I wouldn't take the lack of option exercise notices as a negative at this point as I'd expect most of the larger holders if they are going to action will do so in the final few days of the period. I will be exercising all of mine this week (not that I'm a large oppie holder).

Happy to answer any questions if I can.

mike

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Thank You Mike for that comprehensive report on 'being on the ground' and directly observing the projects and conversing with TNR's personnel.
Really interesting and useful to have another shareholders educated report. I bought for the potential, and it would appear to me that slowly, this is being proven up. The other investments, whilst distractions, have added value to the company that was unforeseen when I bought in. It is good to see 120 Million options converted to date, including NVA. The major problem I can foresee is a takeover bid that doesn't do justice to the potential currently being unlocked. Anyway, still early days. Regards and thanks again.

TNR Price at posting: 2.9¢ Sentiment: Buy Disclosure: Held
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