further expansion

A few facts:

We have a new CFO who "played a key role in two large joint ventures with Chinese partners"

Stone/superb summit are Chinese

NGF's largest holder Zijin has put forward an indicative offer for them. zijin are chinese. NGF's Paddington Mill processed around 150,000 ounces last year. Their Mount Morgan project is slated as being capable of producing 35k ounces if up and running. They also have another QLD project that could add more. lets round that at 200k ounces.


Now for the wild speculation


If Stone were to come to the party there is chance we could take control of all of their operations. There is SHK's old .5 mtpa mill, CRE's mill and the Barrick mill all in the Laverton area. With apollo fully humming and then say 35k ounces from SHK tenemnts (remember they are hamstrung with cashflow and a dodgy mill at the moment) I can't see why the Laverton area can't produce 150k ounces plus.

On the FML side if the Mount ramps up and the open pits are fully functioning we could produce the amount of ore required for 150k ounces quite easily. However, at current capacity the mill would have to be processing 4g/t ore. That's out of the question at this point. HOWEVER. Expand the mill to 1.8mtpa and you are looking at 2.5 g/t which when taking into account a greater volume from the Mount, is highly possible.

I suppose this post is a by product of working out how we would get 500k ounces as indicated in a recent presentation. I believe we had done a tenement swap with NGF previously, so one would assume a close working relationship there. Their largest holder, Zijin, who are making the offer appear to be in it for the long haul and with the best interests of the company at heart. What better way of getting a stake in a monster than buying an undervalued asset in NGF and then as a result having a large stake in an NGF-McFocus JV?

taking away an NGF possibility, if Stone comes on board i think it will be the whole lot as a JV. it seems a bit ridiculous in my mind that we have been going this many months without being able to offer shares or cash to them to make them go away. Everyone has their price and for what we have paid for CRE at the moment, we have plenty of scope to spend more whilst still getting a bargain.

In summary my guess for 500k ounces is a finalisation of the CRE deal, resulting in a JV of sorts with Stone for their SHK tenements, resulting in a run rate of 300k ounces within a year. Followed by a JV with NGF that would see another 150k ounces instantly, with potential for another 50k ounces within 12-18 months through natural expansion and the start up of Mount Morgan.

We roughly have the same MC as NGF, so a merger with NGF would see us with the equivalent of around 9 billion shares (!!!) foll0wed by say a 10:1 or 20:1 consolidation and we are a 500k ounce producer over 4 regions with MC of around 500 million and only 450/900 million shares on issue.

If they made $300 profit per ounce,that'd be 150 million a year with a 500 MC,if that didn't triple automatically I don't know what would.

All ramblings but it's the clearest, cheapest path I can see at this point. Thoughts?