In further response to your request for interesting situations, wonder if anyone here has waded thru the political nonsense in Mongolia and looked at what this thing might do, if the go-ahead for Oyu Tolgoi was given since it looks like that is happening.
The elephant and big hippo on this are Rio Tinto and Ivanhoe.
I am more intrigued by Entree. I like leverage.
Here is a slightly chopped offering from a poster on Investor Village, who like me has been in this thing forever:
Entree Gold Overview
"JV partner for the ground immediately surrounding OT, for 20%, carried and 100% financed by IVN to production. That means Hugo North (copper flats), and Heruga to the south, with OT South and OT North (Hugo) sandwiched in the middle on IVN's 100% ground.
Snapshot of exploration results to date on the 80%/20% JV ground:
1. Copper flats 8.4 billion lbs CU equivalent, 3 million ounces contained gold (indicated or inferred). Open along strike and at depth. Drilling abandoned along the northern strike as caprock and depth was testing the limits of surface drilling. The grades are what makes copper flats special - massive tonnage in the 2% - 4% range. Tonnage is poised to be increased by an open-ended amount once an exploration drift is tunnelled north.
2. Heruga 15.2 billion lbs CU equivalent , 13 million contained ounces contained gold and significant Moly credits, all inferred. Same deal on financing - carried by IVN to production. Again, deposit remains open and not fully deliniated.
20% of 23.6 billion lb CU resource, with 16 million ounces of gold, more to come.
BUT ... you need to look at the maps to fully appreciate Entree's position. OT is the bullseye, the ETG/IVN JV is the first ring around the bullseye, but the second ring is 100% ETG ground that completely encircles the OT camp and is a very large land package. That in turn is encircled by IVN's even larger land licences.
CONSIDER ... when RioT came in with IVN they also made a PP with ETG, immediately followed by IVN exercising anti-dilution rights. About $30 million was placed in ETG's treasury. Shortly thereafter it was announced Sir Michael Howard, former Leader of the Conservative Party of England, was joining the Board of ETG as Vice-Chair. A RioT proxy by all appearances. Then another $30 million PP, this time not taken up by RioT or IVN but undisclosed buyer.
IF ... you look at the history of independant exploration by ETG this largesse of treasury funded to the tune of $60 million is somewhat baffling. They still have over $50 as the only activity has been piddling around here and there for two years, finding some coal (which may turn out to have significant value).
KNOW ... importantly that IVN holds ROFR over ETG's 100% ground - meaning FMV or what a third party might pay to take it out from under them.
IS IT ... coincidence that the seemingly unanticipated delays in approval of the IA and Mongolian politics seem to have left such a potentially large exploration budget gathering dust in ETG's wallet? Methinks not. Cast your eyes on the map to what is soon to become the hottest area play in copper/gold/moly porphry in the world around OT. Ah ... unexplored ETG ground.
PERSONALLY ... I suspect all of the players including Mongolian leadership have suspected the potential for another major discovery at OT is more than merely good. RioT and IVN will want to have consortium partners for infrastructure and smelter. There may be several mines and they intend to shake down other major world producers with the leverage of low cost, low transport cost copper concentrate production at OT. RF will be running an auction or two yet again.
ETG: $50 million in treasury; 20% of 23.6 billion lbs copper/gold resource open to expansion; 100% land package surrounding OT; other worldwide exploration assets, particulalrly the Lordsburg copper porphry target in the USA.
106 million shares FD; all of RF, IVN and RioT have significant shareholdings and the float is tight.
Trading in the $1.40 to $1.80 range in the past few months. Trades like it has a few fat security guards sitting on it."
investorvillage.com
...and to further understand what Entree is about, check out these maps:
investorvillage.com |
