find8 said:-Err...yeah...that happened?And this is the thing:...

find8 said:-

"As I've already mentioned in this forum I will judge CTO based on whether it achieves the December 09 quarterly planned production target...of 15,000 oz."

With all respect, find8, you won't judge at all, based on the Dec 09 or any other production. Because, it seems to me that you have fallen hopelessly in love with this company and cannot bear to hear a bad thing said about it.

Here's something else which you said:-

re: the quarterly result.

I'm giving CTO the benefit of the doubt.

If it can achieve the 40,000 oz/annum rate by the June - September quarter I'd be very happy. That's about 3,300oz/month.

I think achieving 100,000 oz by the end of 2008 would be a magnificent result to aim for .. so i'm allowing it another 3 months to achieve that .. I'll be more than happy by the March quarter of 2009.

When did you say that? Back in March 2008.

However, you can hardly be blamed for being anything other than a true believer: management has never had a bad year - mainly because management only ever addresses the next year, rather than the year just past. Case in point is this Citigold Outlook for 2008, in which management predicts amazing things, including:

* reserves increased to 1moz in 2008, rising to 2moz in 2009 (Chris?);

* gold production was to escalate towards 100Koz pa in 2008 (whereas gold production in the 3 months to Dec 08 was 2,569oz);

* by mid 2009, production was to recommence at the City lodes (first and last mention of that).

Here's an interesting quote, from an interview given by Mark Lynch in 2002:-

"Their [the geologists'] calculations are based on a database including 141,000 metres of drilling, 45 years of past mining records, government records, mine manager reports, and recent trial mining. For comparison, the gian Alumbrera copper-gold resource is based on 67,000 metres of drilling and the Ernest Henry resource on 91,000 metres.

Yes, well, there are a couple of differences: the latter two resources have made their owners insanely wealthy. It's an insult to the intelligence of the reader (and that's the nicest thing I can say) to place CTO in the same class as these two stellar deposits.

Nevertheless, the company has not lacked in confidence. It had planned to be one of Australia's biggest gold mines by now, had you believed this 2003 presser:-

Development of the Warrior Mine is the first stage under the Gold Production Plan that will see gold production commence at 40,000 ounce annually and grow to 250,000 ounces annually over 5 years from a further 3 mines."

Err...yeah...that happened?

And this is the thing: credible companies make forecasts and, by and large, they do what they promise. Sometimes they miss their targets. However, the key word here is, "sometimes".

Try as I might, I am struggling to find even one, single production commitment which CTO has actually kept. Take a look at the links I've provided here: these guys have been making outlandish predictions for more than half a decade.

Anyway, find8: you have become a "True Believer" in this company. Can I give you a piece of friendly advice? There are loads of companies on the ASX which are actually mining heaps of gold. They are companies which reguarly either meet or exceed their production estimates.

I have no doubt that the management and employees at CTO are working as hard as they can. However, people have been trying to economically extract the ore from Charters Towers for over a century. For the most part, it has proven uneconomic. Oh, well.

It is for the management and employees to "keep the faith" in extracting the gold profitably - not for you. As an investor, it is your role to dispassionately assess whether company X is a good use of your money. Here is what the share price of CTO has given its shareholders over the past decade:-