Time For The Bigger Picture

Ok so there’s been a lot of chatter lately about delayed drill results etc and people suggesting this is some sort of terrible issue and they are worried etc and thinking about selling out. So I thought it was time for a big picture thread so everyone can chill a bit.

Firstly, can I just say that if you are expecting these drill results to have much impact then you will be disappointed anyway and haven’t been paying attention. They clearly stated many times (including again in today’s Ann) that Donkey Hill wasn’t their favourite target, but it already had approvals in place so they chose to drill it. It will provide important geological information about the structure and geology etc. But that’s about it. But then if you think this project is about drilling then you also haven’t been paying attention. Granted, we want to add more ounces. Push out to 400-500,000 Oz. But the great thing about this project has never been that it’s an elephant with 1 mil Oz+ potential. That’s not true here.

The great thing about this project is how advanced it is towards production in a high gold price environment. The company will likely have some form of scoping study out early in new year. I can’t be certain but on my rough calcs, I’m expecting it to say that with capital outlay of around $4-5 mil, this thing could be switched on and producing gold. I imagine that with the gold price where it is (or higher) it could be spitting out $10-20 mil free cash a year. From $5 mil capex!!!!!!!!!!!!!Come on peeps. This is not pie in the sky. Plant is there, electricity is there, land is already acquired, mullock heaps are there and incline down to challenger deposit is there.

Who cares if these results (which i suspect were only drilled to ensure newsflow while the real game was finished , being the scoping study) are late or a bit average. We are sitting on an asset that could spit out $100 mil over 6 years with initial start up cost of $5 mil. But could then also expand the resource by say triple and also become a regional toll treater for local projects. It will get bought out by then anyway. A delay in drill results will be a distant memory. Don’t forget that the croupier on twitter who has now cleaned up on ADN and NVA (by holding tight even when doubters and worriers were shouting from the treetops) is the number 4 shareholder here. He is an astute judge of these long term mining projects. I think he may be very right on this one also!! Big picture people. To make 10 X you have to pass up taking 2 X or 3X.