Before I commence this post my view is not to ridicule anyone in...

Before I commence this post my view is not to ridicule anyone in particular, but to merely outline what is involved to bring a project to production in order to put things in perspective. Bitzer has raised some valid points yet in the scheme of things it’s a lot more complex than what meets the eye. Remember EXM is an explorer not a producer !!!!.

We all know what’s in the ground, very encouraging to say the least. What concerns many is lack of news re a possible J/V, placement details and further drilling results which is understandable and frustrating for some.

Is a JV possible ? anything is possible depends on due diligence taken by a party/s as to whether they can perceive underlying value and profit from it. More importantly whether they will take a risk in the current climate.What are the terms and conditions ? what are the benefits to the shareholders?. Are management prepared to consider it at this current point in time? time will tell. As far as Instos are concerned a stock currently sitting at 1c in a volatile market such as this with so many shares on issue ? Hmmmmm If we were sitting at 20-30 c with a positive final BFS report looking at production then maybe in a different market climate perhaps.

Lets consider hypothetically you have a JV partner with expertise in production.Bitzer before you get to a BFS stage you would require a SCOPING STUDY . What’s involved ? Assessing the potential of a project and whether or not it is appropriate to invest time and more importantly capital in order to pursue potential of further development. Therefore more time = more effort = more capital outlay. Further upgrading of JORC resources would also rate highly in my books in terms of mine life. How long has it taken to get this far already with results still pending ?


Next step a PFS (preliminary feasibility study) whereby raw data has to be examined on all aspects of the project. The data has to be extensive enough to look at estimates such as operating costs, capital costs , staffing requirements-skilled labour pre production –post production, accommodation availability, value of the gold, profitability estimates, social and environmental impact data , plus risk assessments and marketability, future market trends, further metallurgy testwork analysis if required, etc, etc..

Other items such as ample power requirements, infrastructure, etc which you have already outlined in your previous post. On the surface this may seem o.k what’s required is further in depth analysis and investigation. Anything above and beyond that is purely speculative at this point in time.


Re- PFS If all of the data is extensive enough, it can provide suitable information regarding commitment to a large capital expenditure and effort towards a final BFS . What I’ve seen with many different speccies over time is the PFS not being extensive or thorough enough. Figures have been subsequently released to the market where on the surface are presented as feasible. A coy then decides to commit to a final BFS only to release subsequent figures showing enormous blowouts in operating costs and capital expenditure. Projects become mothballed need I say more !!!!!The PFS in other words outlays a foundation for a potential project and can be a determining factor whether the project has the potential to be a failure or success.


Hypothetically if a PFS is favourable based on all of the above, next step is a BFS or FFS (Final feasibility study) which involves all aspects of the PFS . The BFS is subject to independent audits from memory whereas a PFS isn’t if it is funded from within house. What’s important is the amount of detail that is given and and to what extent have all the risks been assessed.


In conclusion all we can do is take one step at a time. Take on board what is being presented and evaluate accordingly. As you can see from the above, in order to progress to the next level will require many different levels of consultation and extensive analysis, expertise and more importantly time and lots of it !!!!!!! before a project can be given an undertaking to commence production. What’s important is that if a J/V is undertaken and a scoping study and PFS are commenced that it be extensive and thorough enough to ensure cost blowouts do not occur at a later stage, ensuring future benefits to shareholders remain intact. I would much rather see things be done professionally and accurately rather than cutting corners. If that takes more time then so be it !!.

What’s important is to have the right expertise at hand to undertake such measures and the management wherewithal to see it through . With 3 mil or so in the bank financing more drilling or furthering investigations into production possibilities needs to be taken into consideration if further work is to continue. Capital raising in this climate with further dilution I’ll let you be the judge !!.With the American economy continuing to burst at the seams and the American dollar being propped up gold will have it’s day. Producers first will have first bite of the cherry then flow on effects to explorers with potential such as EXM.

The $ 64 ? for some is whether one is prepared to wait or move on.