Having read through IDC's annual report, I have to say I am very excited over the next few months as they convert the National Instruments 43-101 (Canadian Version of JORC) to Australian JORC!
They have reiterated the fact that they bought the Mt Kare Mountain at a very cheap price after 10 years of drilling by the Canadian Company built up a 1.9Million Ounce Gold Resource at $300 per ounce cut off.
They have $23million in cash, so they wont have to issue additional shares for at least 12-18 months, allowing them to substantially increase their Gold Resource, without having to issue additional shares, therefore building up their gold resource.
IDC paid the previous owners $27m for the tenement in IDC shares and cash.
340 drill holes were completed before the Canadian explorer went bankrupt in 2007 with the GFC.
The most exciting part of Indochine is that in October the NI 43-101 (Canadian Version of JORC) showed a 1.9 Million ounce gold deposit at a time when the price of gold was $600 per ounce,as such the previous company had a very low cut off rate of $300 per ounce.
Now that the price of gold is $1650-1700 per ounce, the cut off will be increased to around $800-900 per ounce. Meaning a JORC resource increase from the 1.9million ounces to approx. 5-6million ounces. There aren't many 5-6million ounce gold deposits with significant upside on the ASX!
Once the EU sorts out their debt issues over the coming week and market sentiment returns back to normal levels. The Enterprise Value of IDC will lift considerably to reflect the significant increase in gold owned by IDC.
As the media cotton's onto this company over the next 30-60 days when they are expected to release the upgraded JORC Gold Resource watch the vols and share price spike BIG TIME!
And they have an additional 10.000m of drilling which they just commenced which will increase the JORC Gold Resource above the 5-6million ounces which will automatically occur once the NI43-101 is converted in a few weeks time.
It is just a matter of getting in cheap and holding on to these small gold companies before they become hot property in 2012.
Cheers Nectar!
IDC Price at posting:
12.8¢ Sentiment: LT Buy Disclosure: Held
