In a perfect world, we invest in DML and mining goes smoothly,...

In a perfect world, we invest in DML and mining goes smoothly, the price of copper goes up, a healthy profit is made and everyone lives happily ever after....

In the real world, DML are battling it out in the middle of nowhere trying to establish a first-class mine on an obviously rich deposit and have hit some teething problems which have put a strain on the short-term cash flow.

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DML have now said that they need an extra 3 months to become cash positive and need to do a CR to get there.

The collapse in the SP has made this CR seem a lot worse than it really is.

I am assuming they need 12.5c per share and the only way they can raise this ,at today's SP, would be to do a 1 for 2 CR - not a good look.

But, just imagine if the SP was still $1.40 and they asked for a 1 for 10 (10%) CR at $1.25 - no-one would bat an eyelid and the net amount collected would be the same!


The way I see things is IF (when?) DML becomes cash positive in June, the SP will bounce back to at least the $1.40 level.

I think a $1 gain for a 12.5c outlay is a pretty good return and so I will participate fully in any CR they might have.

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I don't think we have heard the last of CF either. China always plans long-term, they know how much copper they are going to need in the next 50 years and DML's reports of copper at depths of 460m+ will secure them supply for many years to come.

They are sitting on a mountain of cash reserves and it would not surprise me if they somehow got control of DML and ramped up production to get it all safely in their warehouses ASAP.