I believe VRE had to sell to keep the company as a going concern. This is very disappointing but understand why they why the had to sell the asset.
My concern with VRE going forward is with production quantities and cost per ounce. Discovery is only remanent mining which will last for the next 9, maybe 12 months. What will substitute these ounces when they run out.
If you look at the grade of the dirt treated, 1.96 grams/tonne this is very hard to make money out of. It would cost approx $15 per tonne to mill and normally around $5/tonne administration. December they treated 173k tonnes which equates to $3.5M costs. Mining estimates at Discovery $1.5M/month, Calista $2-2.5M, Open Pit $1.5-2M. Total costs $8.5M-9.5M/month, 10,000 oz per month @ $850-1000/oz doesn't leave much profit. Add on corporate costs for MD, COO and support staff plus expensive office in Perth, for a now one mine company.
December quarterly shall be an interesting read. Bet they don't bring it out to very late in Jan.
VRE Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
