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Gold/Mining/Energy : ECM.VSE - El Callao Mining.
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To: BAKE who wrote (1193)2/6/1999 5:45:00 PM
From: John Soileau  Read Replies (1) of 1253
 
Talked to IR about this Friday. Recap:
Bema will not be taking ECM out in present circumstances, "not at these share prices". Meaning the share prices would have to be higher before that kind of deal is done.
Bankable feas. study will take about 9 mos, so we should see it late in 99. Barclays is who Bema\ECM will likely go to for $, but the equity part of the development costs has to be figured out. Maybe
pledge mine output, who knows yet, but they want to avoid big dilution.
VZ is in a recession big time, needs employment and foreign investment, the new government will likely not shoot its mining industry down. Lo Increible is right in an existing mining area, no rain forest or native americans to deal with.
In this environment might be possible to buy a nearby existing mill real cheap and be producing ozs at Kmart prices.
If you like ECM's prefeasibility numbers, wait for the feasibility! All arrows point to IMPROVEMENT as the process continues.
The concession controlled by ECM is enormous and prospective. What's going on now is not likely to be the end of the story. Pure blue-sky at this point though.
Forgot to ask whether drilling is currently going on, how many drills etc. (damn!)

REMEMBER: the foregoing is from IR, treat it accordingly!
Bottom line in my opinion is that the project's location, size and numbers make it a mine IF Bema negotiates two hazards: VZ and financing. Lets see how Clive & Co. performs. I worry less about financing than VZ; predicting latin american politics is like predicting which
Florida lottery ticket will win tonight (hope it's mine).
John

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