idc's mt kare vs barrick's 30mill oz porgera!, page-3

Hey Lara

Their cash burn is not as bad as the Appendix 5Bs show in 2H2011.

They had to pay for 12 months worth of drilling/helicopter/labs etc in advance in Q4 2011 to ensure they are allocated adequate staff to complete the task of drilling and analysing the assays in order to complete the PFS in 5-6 months.

I would expect by October they will need additional cash. By then who cares if they issue 20million shares to raise $20-25million to complete the BFS once its market cap better reflects the gold resource in the ground.

What is important is to build the value of the resource faster than the cash burn, which is definitely happening at Mt Kare, because 365 drill holes were already paid for and analysed by the previous owners Buffalo Gold who went into liquidation, and IDC picked up all the research very cheaply from the administrators in March 2011.

They also have very large institutions invested in IndoCHine as cornerstone investors. Och Ziff, Baker Steel, Black Rock etc. These guys will be the first to put in a bit of extra cash to get the mine started.

The other benefit we have is that over 80% of the shares are tightly held by the Top 20 Shareholders. An excellent advantage when new investors come in late in the piece in a few months time, as we get closer to the PFS.

We will also see local investment houses begin to take a stake in IDC once it breaks the $200m Market Cap. In most cases they have a policy not to invest in ASX listed companies less than $200million market cap. This is when the big dollars will start flowing into Indochine, lifting its share price significantly.

BTW Dont forget, its current share price is:

1. Less than the original IPO listing price of 20c per share
and
2. Less than the capital raising price that was oversubsribed in March 2011, which was used to pay to buy the IDC project, 30c per share. We are currently buying it at heavily discounted prices to what the Institutional Investors paid.

IDC has achieved a lot in only 15 months since first listing on the ASX. Kudos to their staff and management.

Again these are my opinions, please read through previous announcements and reports by IndoChine.

Also check out this video made by the helicopter firm that is drilling Mt Kare. It shows our Project Manager George Niumiatawalu and our head Geologist David Meade, as well as other experienced members of our team and the locals, panning for gold in the streams on Mt Kare! There are a few thousand dollars worth of gold in that gold pan!

It needs sound. Enjoy :)

http://www.youtube.com/watch?v=ZN2O3UhSzp8