I agree and I hope we are right. For me the strip ratio is a good indication of the efficiency of mining and AJM has consistently held it at 3:1 thus far. The issues on other plants with higher strip ratios would lead me to believe there are going to be significantly bigger headaches for those miners that have higher strip ratios. It stands to reason, that as you move significantly more dirt to get at the mineral you want, it's not only more costly and uneconomical, but also there is a greater risk of mineral contamination and as a result material processing issues. For me there were three reasons I invested in AJM:
1) Management team
2) LOM grade ( good grade but granted not the best out there yet- I say yet because I think we have used a conservative estimate in DFS)
3) Strip ratio LOM 3:1
People here are going on about the debt. I happen to think that given the complexity of processes it's best to have a full mine fully financed than half a mine build burning through cash flow, not achieving decent grades or off takes, than the position we are currently in. AJM management had a choice to go for a fully financed (complete mine), producing high grade product or skrimping on certain parts of mine and burning through dirt and ore and producing an average product. Management have chosen the former option and we patiently await the commercial confirmation and justification of this decision as represented by this quarterly. The only think management can control is production and quality, and to a lesser extent off takes. The market will do what the market wants in terms of sales price, but so long as we are producing high grade product at a decent margin we should be ok. To do this processing and cost efficiency are critical- I think our management team understand this. Good luck all!
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