Honestly, I can imagine Calida Smilie feeling like a real true grown up business analyst by using the jargon "penny dreadful" and then using the word "funding woes" against the face of the reality that we have money in the bank and Amer is not the remotest requirement of our business. She forgot to mention in the article how many successful public listed companies she has set up and run that aren't penny dreadfuls (answer: none) to enable her to pass judgment from her ivory tower.
Such an astute journalist writing for the online edition of NBR - we get better analysis on HotCopper from even the freshest, most lowly poster.
Anyway, if you want to read this rubbish here you go:
NTL has moved up 280% in two months, as the company makes progress after many setbacks.
The share price is still in penny dreadful status at 1.9c a share – albeit up from 0.5c a share a couple of months ago.
But chief executive Matthew Hill says this demonstrates shareholders are beginning to see rewards – if not gold just yet.
“A shareholder putting in $1000 this time last year is now sitting on nearly $4000.
“From a perspective of developments of profitability giving them dividends, that’s a future point in time type scenario, once we’ve completed our pre-feasibility and are able to establish the full economics of this mine.”
The mining minnow’s October 2012 prospectus indicated mining would start mid-2014 – but it hit roadblocks with conservation battles and funding challenges.
It focuses on the Talisman prospect in the Karangahape Gorge, which had been mined intermittently for more than 100 years from the 1880s, producing over its operating life upwards of one million ounces of gold and three million ounces of silver – making it New Zealand’s second most productive gold mine.
Funding dried up in the early 1990s and the work stopped, although New Talisman was granted a 25-year permit to prospect and mine the land in 2009.
New Talisman’s share price rise was prompted by its July 12 announcement that early resource modelling of its so-called Dubbo zone indicated 312,800 oz gold equivalent – a 102% increase on a 2004 estimate.
The company says this 8500kg of high-quality gold puts it in the top 5% of deposits worldwide when ranked on grade.
New Talisman, which is also listed on the ASX, then told the market on July 21 it had advanced underground and is taking 5kg samples for testing, which should be done by the end of September.
“We’re well underground – about 400 metres as of today,” Mr Hill says. “The expectation is we’ll start taking ore out of the mine later this year.”
The company has completed its plan for bulk sampling and has a resource consent from the Hauraki District Council to mine the conservation land, which will be triggered later this year.
Funding woes
New Talisman has had problems in the past attracting ongoing funding for its operations, with three separate Chinese investor groups calling off agreements for various reasons.
In June last year, it signed a non-binding agreement with Shenzhen-based Amer International for 70% of the company in return for cash and guaranteed profit underwrites for three years.
Mr Hill says that agreement expired in August last year, although discussions continued with Amer.
“Essentially the ball’s in its court, and we’re really focused on the work we’re undertaking.
“Now we have a market cap of almost $40 million compared to about $5 million when we first talked, so obviously that requires further discussion with Amer if it's going to provide economic value to our shareholders.”
Instead, the company raised $6.5 million at 0.5c last year from existing shareholders, which will see it through the next couple of years of bulk sampling, at a budgeted cost of $2.2 million.
“We’re well funded for the operations we’ve set out to commence. But having said that, the developments that are going on underneath us will determine further exploration capital intent activity as we progress,” Mr Hill says.
The company’s annual report, published earlier this month, points out the capital raise has put it in “the healthiest state it has been in for over a decade.”
New Talisman made a net loss of $701,365 in the year to March 31, narrowing its $2.84 million loss the year before.
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