There are only 4 basic things needed in mining for success:
1. A large high grade deposit of commodity
2. A high value market to sell into
3. A competent operating team to mine and process to saleable commodity
4. The cash to deliver and provide time to plan and deliver carefully.
Does Austar have these? YES!
In my view, considering the MStar deeps resources, the other mines and exploration areas as suggested by the Woods Point to Walhalla historical production, that Austar is sitting on a 10million ounce plus project at plus 15gtams per tonne.
Gold has been on an upward trend since 2010, blips here and there, but global consensus is that it is headed for US$2000/oz next 2 years and possibly US$5000/oz long term. Historically only 160,000tonnes of gold have ever been mined and generally 60% has been absorbed by India, half for jewellery manufacture and half for gold dowry and hoarding. The other 40% goes to manufacturing (all soldered connections in computer electronics etc due to non corrosion and high conductivity properties). China now has 130,000 small gold shops selling ultra small gold pieces to populous and emerging middle class and Chinese have same love of gold as Indians. Computer based tech of course can only continue to explode. When times are good people and countries hoard gold and in bad times there is a flight to gold.
Tom De Vries and Matt Gill are as good as any other gold miners, especially in underground nuggets Victorian gold mining.
Maybe end up with $10mill cash to deliver with is near enough to $1mill to use per month.
Add on top Rick Valenta direction regional exploration noting Frank Terranova was the Chairman of the first ASX explorer that Rick was MD of and I am as such buying back in.
Half a cent share price and $10mill soon to be near $20mill market cap with all those fundamentals suggests a soon to be $50 - $100mill market cap.
I expect any good fiscally astute Board would consolidate from 3billion shares to 300million shares to ensure the share price is around 30 to 50 cents which is out of penny stock territory such that instos investment guidelines allow entry.
For these reasons I’m back in in spades.
GLTA KRUM
AUL Price at posting:
0.6¢ Sentiment: Buy Disclosure: Not Held
