Alacran may indeed ultimately be “very profitable for the Company” ... but will it achieve net-positive value for current shareholders between now and the point when it has exhausted all economic value?
I’m not even being retrospective here (because many millions in shareholder dollars and equ value have already been spent getting to our current position with respect to MDP & LB) Im talking future dilution, corporate and capex needed to monetize the resource and keep the wheels turning over the next 6 or 7 years
Will Alacran be profitable for the “Company”? How do we define “Company”? Are we referring to the listed corporate entity? Then yeh, Alacran will undoubtedly give longevity to ASX:AZS. Referring to staff? Yes, Tony and assoc will be tinkering away in hot desert sands for many years to come and continue to draw generous wages based on this discovery.
Refering to current shareholders? Jury is out imo. There’s no guarantee anyone holding now will see an ROI on current investment if they hold until then. The market at large recognizes this, which is why Alacran JVs never really had a significant positive effect of share price
Some people may feel challenged and anxious to hear these sorts of views but I don’t care. I think it’s an even handed analysis which contextualises risks and opportunities. This is a dangerous stock to white-knuckle
