swearegen,In IAU's Management Discussion and Analysis December...

swearegen,

In IAU's Management Discussion and Analysis December 2008, there is mention of 13,000m of drilling yet to be incorporated into the resource. IAU was due to release an updated resource mid-2009, however I guess that is now for TRY to do.

From the same document:-

The 2008 drill program was completed during the quarter. The total metres drilled from May 2008 to October 2008 were 13,061 metres in 61 holes (CA-08-220 to CA-08-280). The drill costs for the entire program were approximately US$2.1 million at US$162 per metre.

External consultants conducted work to help the site teams prioritise future drilling targets and confirm the validity of the current assumptions regarding the structural setting of the deposit. Mercado was quickly identified as being under stated in terms of drilling prioritization, while Cerro Norte was also deemed of high interest.

With the assistance of AMEC, a timetable was created which allows for an updated Mineral Resource estimate to be produced by mid 2009 to include all recent results from the 2008 program. AMEC is also supervising an update of the wireframe modeling of all lithogical units and the ore zones over the deposit,

IAU was carrying Casposo on its books at $60m, so for TRY to get it for $22m was great buying. While you might initially think, "Hmmm...what's wrong with it, if they sold such an advanced project so cheap?" Well, there seems to be three factors.

First, the feasibility study was completed in mid-2008. The debt and equity markets were essentially closed at that time.

Second, even if they got funding, when you add the cost of building a mill and commissioning a mine to a pre-existing $60m capital value, the project economics aren't fantastic, unless it's a +1moz project. However, if you manage to buy it for $22m and you just happen to have a mill sitting in storage, the economics look a whole lot different.

And third, they had just hit the porphyry system underneath their Indonesian project and were awe-struck (as am I) at their low-grade, +600m Cu/Au intercept. After that, they most certainly did not want to go out of business before taking a crack at drilling it to see what they could find, and $22m would certainly go a long way towards that.

Anyway, that's my thinking. Here is the link to these yet-to-be-included drill intercepts (at least, those which had been completed and assayed in Oct 08): http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=00889876