"And part of the answer is right at the end of the PR:
On a related front, discussions with government regarding the adoption of the Forestry
Guidelines are progressing.
This is the main reason why the share price is so discounted. "
I think you are probably right when it comes to the situation of having the deposit within the 'Forest'. Another reason would be that the properties are located in Africa and that comes with additional political risk and hence a lower valuation.
That being said, and although the area in technically in the Forest Reserve, I understand that there are no trees to be found in the Mampon area. If that is so, it should make a decision to permit mining of this property a bit easier to swallow should the government want to change designation of the area around Mampon, or make an exception to the present guidelines.
As for being in Africa (i.e. Ghana), several major mining companies are now actively looking at Africa for their next bit hit. A few years ago they just wanted to get out but the values are so compelling that they are returning when the situation is right. Many countries in Africa, and that includes Ghana, are finding that if they don't treat foreign investors better, they will have that wealth locked in the ground for a very long time and nobody will benefit from it being there. Hence, in Ghana they are presently reviewing the Government's 'Golden Share' provision that makes the government your partner - like it or not. They will likely want something in return, but at least they are looking at improving the climate for mining investment within their borders.
At $0.22 there is risk, but it certainly seems to be a risk worth taking given the high assay results they obtained in several of those drill holes. For example, RMP365A had 30 meters of 33.27 g/t and it stopped in mineralization. That's over an ounce per ton down to about 250 feet. In a open pit situation, that kind of result would be outstanding.
I am a shareholder so I am biased.
Brian |
