I held this stock for many yrs in the hope that they would one day develop the Yukon project, unfortunately i continued to hold despite the falling SP in the hope it would turn around as the coy were continuing to maintain that everything was on track with the feasibility study and development plans. My hopes were reassured when MQG increased there holdings just prior to the study release. Astonishing on reflection how MQG also bought the story and reiterates to me the fact that it wasn't just my blind naivety riding the SP to the bottom. I emailed the coy just after the release of the study circa June 2012, (which took us all by surprise i might add after all the positive pre announcements re the project, infact knocked our socks off would be an under statement)and to my amazement received the following response,You be the judge
1 Is the company aware that you cannot access archived ASX releases on the company website ?
Thank you your brining this to our attention. This has been rectified.
2 After 3 positive studies, how does this latest study fall so short ?, even after all the positive expectations and sentiment released by you to the market and media regarding the Yukon project, as most recently as the March quarterly, 10 weeks prior.
Since our announcement on 17 December 2009 the mining study has been a work in progress. We were not in a position to provide an informed revision in expectations until the completion of these detailed studies.
3 In regards to Capex, I can understand some slippage of say 25 even 50% from the previous study, but how does the Capex blowout some 400-460% from previous studies which indicated circa 63m-120m capex ?
Since our announcement on 17 December 2009 the mining study has been a work in progress. We were not in a position to provide an informed revision in expectations until the completion of these detailed studies.
4 Why has production costs increased so dramatically from 30-40c from previous studies to 70c ?
Since our announcement on 17 December 2009 the mining study has been a work in progress. We were not in a position to provide an informed revision in expectations until the completion of these detailed studies.
5 Is management aware of any possible take over plans or any potential offer to buy the "Yukon base metal project" ?
We cannot provide guidance on this.
6 Has the company discussed and or have any plans to sell the Yukon base metal project ?
We cannot provide guidance on this.
7 What sustained price of zinc does management consider the project viable
We cannot provide guidance on this other than as stated in the 13 June release that “… an improvement in both zinc and lead prices will be required to provide a suitable return to the Company and its shareholders …”.
8 Is the company going to release the entire mining study to the market, if so when ?
We cannot provide guidance on this.
9 Considering the mine permit process takes up to 24mths, why can't the company submit for the mining permit whilst a recovery in the metal markets are taking place within that time frame ?
The Board considered this alternative but as stated in the 13 June release has elected to suspend mine permitting at this time.
10 Where to from here and when does the company anticipate commencing drilling ?
We are assessing new opportunities and considering further exploration at the Yukon Base Metal Project, we cannot provide guidance on the timing of drilling at this time.
11 With $3.2m cash at hand, how does the company intend on funding future drilling and working capital ?
With the cash at hand.
12 Is the company intending to initiate a capital raising ?
We cannot provide guidance on this.
13 Did the company have a much higher expectation of the 2011 drill season ? and as a result did the paradigm placement pull its support for the project ?
We believe we implemented a successful drilling program in 2011, see 12 March 2012 release.
In conclusion Mr xxxx, I would just like to say that I do appreciate there are a lot of questions I have asked, however I do need and deserve answers to them.
Moving forward, has the company considered a smaller less capital intensive single start up pit with the Andrew resource alone? and or a possible joint venture with Glencore or possibly Nyrstar?
The Company intends continuing to consider all alternatives to realise value from the project.
Again I appreciate your time Mr xxxxx and do look forward to hearing your response
Kind Regards
ps I've since moved on and cut my loses some time ago and have taken a position in IBG. a pure zinc play with a massive resource on the cusp of development, worth a look.
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