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Gold/Mining/Energy : Golden Eagle Int. (MYNG)
MYNG 0.0700+5.7%Feb 21 4:00 PM EST
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To: Michel Grenier who wrote (3331)5/25/1998 11:10:00 PM
From: Claude Cormier  Read Replies (1) of 34075
 
<< To get financing in those conditions, they would have to sell the farm...cheap. If, however, they start production on a relatively small scale as planned and generate $2M to $3M a month in net income, they can self finance more complete surveys and then, go to the bank or to partners and get good conditions >>

First, they don't need to finance everything now. A 5M shares (less than 3% dillution) would give them more than enough for a meaningfull program that would help confirm their findings and bring the stock mucg higher.

Second, in order to produce $2M to $3M in met income per month, they need to produce at least a few hundred thousand ounces per year. This means that they must build a large operation that will cost between $50M and $100M..and will take more than a year to build. Doesn't make too much sense.

I am sure that their current facilities are not capable of producing these quantities of gold. I haven't seen more than $2-3 millions raised by this company in the past year..either by private placement or credit facility. So their facilities are rather small. Net income of a few hundred thousand per month would make more sense base on what I read in the June 23, 97 report.

So IMO immediate financing is the way to go.
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