Gold price, page-6048

Well all, I am back. Plenty of thoughts to try and remember and share from the last week. I will try and go top down.

I don't have too much to say on the macro scene. Both currency and gold have been very hard to predict in my view from an FA stand point. TA seems to be do a little better in so far that I believe we are still confined pretty well to that large pennant that has been forming. Getting really close to the pointy end. In saying that, today is the last day of the quarter. We have made it through with a healthy average POG price and no days under $1,300 which is good.

Next up I thought SJ was great at his presentations, he knows what he is talking about and I got the feeling he actually has some passion about this project. There is plenty of gold there by the sound of it. (As a side note, maybe we ditch the BDR bus, and fly to Tucano, and just start digging with shovels, probably find enough gold to fly back first class and buy some extra shares ).

Irony is a funny game and it has showed itself a bit over the last week in some of the rumblings. On one hand some have suggested that SJ doesn't really deserve that much credit and the turning around of the operation has been on the back of a rising POG but on the other hand he has been criticised (still) for the CR early in the year. My question is how much attention do people actually pay to the financials of this company. We scraped in a mere 6m profit in H1 on the back of a high POG while we were still turning the ship and cementing wet weather operations. What if POG had rolled over in March or April and had headed back down towards $1,200 or even $1,100. We would have made a loss that the company couldn't really afford and there would have been no chance of raising funds.

Look I agree that dilution may have been reduced a little if they had held off just a little bit but in my opinion that CR was still the BDR catalyst and a vital first step in the story of the new BDR.

This leads me to the next point - guidance. Production for H1 was 56,615 ounces. This leaves 88,385 ounces for H2 to hit the lower end of guidance. We hit 40,000 ounces in Q4 last year with no input from duckhead. We know from SJ speeches that their will be a slight overflow into Q4 of duckhead production. Now at 34.1g per tonne and 88% recovery duckhead ore is basically 0.965 ounces per tonne. It means it occupies basically no mill time. This is important because one of the most improved aspects of the operation this year has been material movement. Hence they should be able to feed the mill constantly with normal ore and duckhead is nearly all bonus. So given the above I think if we see production of anything over 45k this quarter then it is an easy horse to back home from there to it guidance.

I realise the scars last a long time for some but I don't think there is anything to date to suggest guidance won't be hit but nothing wrong with monitoring it to make sure.

Lastly the new appointments - I like some others am actually wary about this. They are hiring a team that sounds they like they are mining M&A specialists. I do not want to see any equity raisings. I do not want to see any fresh debt taken on. I do not want to see us sold before we realise our potential. What I do want to see is organic growth. That means us reaching 200kt production from the current operation and consistently hitting guidance. From there it would mean a second mill and the mining of some of this new ore to move us toward 250kt and then 300 and so on. But I really hope they do it where possible over time and in step fashion with available cash rather than trying to go too big too quick.

Alright. That is enough from me.