Richard,
I could not agree more with your statements. The company is fully valued based upon its "piss poor" handling of public relations. They have concentrated on the "ore pile" as the current focus and failed to give full billing to the "other properties".
Lets talk bout the "ore pile" for a while. The " ore pile" is stated to be .5 mil tons. Well, the property contains many multiples of that which have not been "beneficated". By that I mean that the in ground ore has not been run through a gravel screen to remove the gravel, leaving the fines which are the "head ore". Pretty simple stuff.
A conservative estimate of the remaining value of the property at the H. project would be in the area of 5 to 15 million tons of beneficated ore, and I hedge as I do not know the depth of the unbeneficated ore.
Ok, we have several unknown factors here, and I will discuss my greatest concerns first. If what the company is telling us about their present capabilities is true, then they can extract economically somewhere in the area of $500 to $750 per ton of beneficated ore at a rate of 5 to 10 tons per day now and looking for further capacity and process improvements. Obviously, they must exceed their costs. Given present figures, I calculate that they could achieve profitability at 15 tons per day and still leave some excess for capital investment.
Big Caveat! If what we are told is true!
One might ask why I factor in such a large "fudge factor"! The answer is past performance!
Performance will or will not happen. What is clear to me and should be clear to all present and potential investors is that performance and production are the key. The company will or will not perform! No longer will investors value this company based upon its "potential", they will value it upon its performance. That requires production and the "P" word!!
Realistically, I do expect the company to require funding to continue its progress. I am certain that Jensen will do that at any cost.
If you ask me to predict the final outcome, forget it, for I will not!!
You got to make your own call!!
Owncall, Jack!! |
