The company needs to adjust to new realities; when we started...

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pdi

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14/11/22

19:41

Post #: 64766418
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Originally posted by signalFollower: ↑

both yours and @pdi comments made me think back to the first interview where both Brian and Chris spoke, for those that recall, Brian was very focussed on getting a few smaller cash producing projects up, so I tend to agree that La Demajagua and the El Pilar Oxide Cap should / could be what is progressed.

In terms of Oxide Cap JORC drilling, maybe there is scope to drill deeper down through and into the top of the anticipated porphyry cap so as to increase the confidence of that system being underlying.

But with metals prices and what the commentators are saying are likely to be metals prices looking forward, itmakes sense to get at least one, if not two cash producing operations up and going, and they're both supposed to be relatively small capex too from what we 've previously been advised of.

I have recently created a LaDemajagua inspired template on my tradingview, that shows for btoh silver and gold USD / oz where the Feb Scoping study and sensitivity put the NPV

notes on LD Feb Scoping study:

gold forecast at $1650 USD
silver forecast at $22 USD
Gold to Silver ration implied at 75:1 to calculate AU Equivalent

so here's some charts on the above with respects to prices (green line is the scoping study values used and on the gold I have included the sensitivity NPVs too)

of course none of this includes the more recenlt update we received about the potential of antimony

but anyway here's the data in ascoping study context kind of way

Gold - above modelled price

triple bottom at around covid price levels

Silver - just below modelled price

quadruple bottom at pre-covid price levels

Gold to Silver ratio - just above modelled ratioabove 75:1 means fewer AuEq oz, but gold prices prossibly offset that

of course both of these will change the DFS / Scoping Study:

revised MRE for the final set of LD assays
any antimony sales revenue

so under $20m market cap versus just La Demajagua NPV, how much better would that look with a simple / low cost operation for the Oxide Cap open pit too ?

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Originally posted by capriccioso: ↑

My vote would be to focus on funding and building the mine, as early as possible. Aerial surveys and drilling can come later, once La Demajagua is producing. Bringing the DFS forward and announcing funding early next year could give options some chance of getting into the money, with the associated funds from option conversion reducing dilution via capital raising. The DFS could be revised later to take antimony into account. Why shouldn't or can't this be done?

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The company needs to adjust to new realities; when we started the project, the conditions were completely different.

No one could predict that we would have the pandemic, the war in Russia and the massive slowdown in China and those factors play an enormous role in our case.

Although no one can predict the future good managers can adjust to changes, this is the issue with AAU. We are burning the cash at a rate that will be too difficult to restore.

There is no rush with the new drillings. We don't have money for that.

Build the mine, show that you can finalise the project, and the share price will go up; then, we can do a CR with minimal dilution if necessary for further projects.

Loads of investors had massive losses in Russia and China, so I am not surprised that everyone is sceptical about Cuba. Brian can ease the anxiety and attract more potential investors if he is successful with DLJ mine. I can't see any other option for the share price to increase.
AAU Price at posting: 4.2¢ Sentiment: None Disclosure: Held
3 Upvote

0 Great analysis

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