Please note that these notes are my view of the Annual General Meeting. The Annual General Meeting is a forum in which the public is entitled to attend and listen to anything discussed, I am simply reporting my interpretation of the discussion.
Notes from Kensington AGM -
Members of the board in attendance were Mr. David Stone, Mr. Murray Tildeslay, Mr. Art DeCarle, and Tony? - sorry for the spelling.
The drilling results were delayed because of a technical glitch which caused things to back up. The database of the drilling results for the bulk samples was sent to Dr. Rombouts in Europe the middle of last week. Late this week, or early next week a report should come from Dr. Rombouts. Debeers is doing a parallel study. The results of the Midas Samples are back.
Debeers is doing computer scanning on some of the stones to enhance fragmentation. They can now re-construct a stone that is fragmented even though only 20% of it might be there, since they know the physical properties of the stone. It seems in the drill program there is a lot of fragmentation since the stones come up to the surface at the speed of a bullet. This has been corrected partially by new techniques, and preliminary results seem to be better than before.
Debeers is taking this project seriously. I believe they are playing catch-up with BHP. They have hired a man on a 3 year contract from Australia, I believe his name is Adrian Berryman. Debeers is interested in this project, but are results driven. If the results are there, then things will proceed.
There is some discussion of moving the concentrating plant from Grand Prairie in Alberta to the FALC site. The concentrating plant took 87 tons (or was it 87,000 tons) of material, and concentrated that to ¾ of a ton. That ¾ of a ton was sent to South Africa for analysis. The tailings that were left behind are also being analyzed to see if anything was missed there.
The prime focus is on Kimberlite 220, although there are really ½ dozen candidates. 2 or 3 have higher quality stones than 220.
The aim is to prove out 100 million tons of material. In 1 cluster there is 2 billion tons of kimberlite. The next sample they want to prove out will be a 500 to 600 ton sample.
The current mini-bulk samples that have been taken are all improvements over previous results.
Currently KRT has 38% share in the claims. If Cameco doesn't come to the party on the next drill program, we will have 45%. When we were at $4.90 per share a couple of years ago, we only had 25% of the claim, now we have 38%. The statement was made that at such a high percentage, we are a very attractive target for a take-over. Some discussion ensued about warding off a hostile takeover until the right price was hit. We were assured that a majority of the shares are in friendly hands. Between Mr. Ellard, and Mr. Tildesley there are over 3 million shares. There are probably between 4 or 5 million shares alone in the Victoria area.
A promotion program is starting next week. There will be someone on the telephone full time. There is an advertising campaign starting. David Stone had a preliminary brochure which was going to the printers tomorrow subject to final proof reading by the board. The financing is in place for all of this, Mr. Peter Allard has put in another $80,000 to cover the financing. There is also another group out of England that has offered funding. It was stated that many people are now interested in this project. Another group from Vancouver has also approached KRT, as well as a group out of Santa Barbara who have New York Connections. Mr. Stone was leaving the AGM to meet with another group who are interested in doing drilling for us for shares.
There will be an e-mail campaign, and Mr. Peter Nixon has been contracted to do a road show, he will be primarily concentrating on institutional investors. Mr. Nixon will start mid-July, as soon as the new brochure is printed. His 1st meeting will be with an RBC analyst out of London. Mr. Nixon is also out of England, and is a world renowned expert in the field of diamonds.
Shore Gold has also contacted KRT. The new president for Shore Gold is Mr. Peter Challis (it was he that made a buy recommendation for KRT up to $8.00 per share a couple of years ago) and he has approached KRT possibly with some type of alignment. Clive met Jonathan in London last week - Shore has financing in place for their drill program. They apparently have 2 kimberlites adjacent to the KRT property.
There was some discussion about putting KRT on the Nasdaq. The possibility of doing this through an already listed shell company has been dropped, it is more economical for us to list there ourselves. This simply makes it easier for US people to invest instead of using the VSE.
A discussion ensued about the economic value of the project. We need 20 carats per 100 tons at $75 US per carat or in other words we need $15 per ton to be economically viable. In one small grab sample there were 25 stones in 10 kilograms. (these were small stones, but where there are small stones, there are usually larger ones to follow.) The cut off size for stones we are considering is .074MM. The value of small stones has also increased over recent months. The thinking is that next year by all current trends is that the demand will out strip the supply.
Another note of interest, the price for Diamet, considering it's split is $120 per share.
Mr. DeCarle suggested that he believes that the project could be mined selectively to hit the higher grades. There is a belief that there could be "Apron" deposits where some of the larger, and greater quantity stones could be resting. These areas would be targets for selectively mining the site. It was mentioned that there could be potential for stones as high as 20 carats.
Mr. Peter Nixon, or Mr. Clive Newall could be utilized to write a technical report on the site. The stones that have been recovered to date are 70% gem quality.
Another person that is starting promotion for us in the next couple of days is Mr. Bill Callahan from California.
It was mentioned that our security as a company has increased vastly with Mr. Ellard on Board.
To summarize - points I took home are -
1. There are more diamonds down there, there has to be, or else there would be nothing to send to Dr. Rombouts.
2. The promotion is starting next week, which should make the share price take-off.
3. We are very secure as a company as there is now a lot of interest in us. Something has driven that interest. Mr. Ellard has put his money where his mouth is, along with Murray Tildesley. We have sufficient funding for the promotion, and a drill program, and some want to drill for us for free if they can get some shares.
4. The drill results and news releases should be done by the end of July. Some of the people coming on board have very high credentials.
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