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Strategies & Market Trends : The Aristocrats (tm) -- Ignore unavailable to you. Want to Upgrade?

To: Logain Ablar who wrote (3385)	2/15/2022 2:25:27 PM
From: sense	Respond to of 5610

I've also noted the obvious trend in juniors trying to start mines, now... LRTNF, NEVDF... GATO, GPL... AUNFF I think is just a rock fall... But, they all still go through the wringer... and follow pretty much the same script. First, they find it a lot harder than expected. They run into operating difficulties in the development... the first consequence of which is the burn rate demands they raise more money. That usually doesn't solve the problem... so they'll have to raise money again... fire the project manager or the CEO... and hire people who do know what they're doing. The guys who do know what they're doing poke at the project and tell them... "yeah, we can fix it... but its going to cost $X"... so, back to the market yet again... now with the share price a fraction of what it was previously... but, can't be avoided... The guys they end up hiring... are invariably a "been there, done that" crew hired away from one of the majors... So, once they're on board and working on a fix... it suddenly goes very, very quiet... and stays quiet for weeks to months... and, then... when news comes its probably just a "yeah, we're OK"... A really good thing to see... is companies that make that sudden shift in the employment... to bring on that set of skills... BEFORE they commit the exploration staff to start trying to become operators... They are VERY different skill sets... and there's really no excuse for not hiring specialized, experienced, and well qualified professional mine builders to build a mine... when that's the task at hand. And, that doesn't mean someone who was there, once, when someone else led a project... It means hiring someone with a PROVEN track record of solving problems... because... there will be problems. Again, that's why the Lasonde curve exists in the form it does... as the risks go up dramatically with the transition to mine building... and don't abate again until "routine operations" have been working routinely, at a profit, for at least a quarter or two... It's pretty predictable... when management think they'll do it themselves... or "do it on the cheap"... you will end up a bag holder... unless... you're "waiting for it"... because it was predictable... and then you get to pick up shares worth $1 for $0.20... as they "fix" the problem, once the risks are realized... That's what "buy low" means in the junior mine developer space... And, since its been a OVER A DECADE since we've done any of this... there will be more...