Hello Eddy
The Yamba Lake property is in my humble and admittedly ill-informed opinion, SUF's short-term salvation and (hopefully) long term future.
Reason #1
As you know, SUF is not given to promotional rhetoric and the day I hear HB make a promotional statement, I suspect I will choke on my Easter turkey. When SUF says they have documented 30 "low level airborne geophysical targets" with 66% of the site surveyed, that is not the same as when Fly By Night Diamonds says it. SUF's low level aerial targets are I am sure, not simply circular mag or EM lows and highs, but probably coincident, perhaps corresponding to discrete lakes and/or Mackenzie Dikes, and very probably exhibiting the same specific band signals as existing pipes on the property.
What I am trying to say in my usual rambling way, is that SUF's targets more than likely have a high possibility of being, and can generally be presumed to be, kimberlite pipes. Current ground mag testing and concurrent geochemical sampling over the targets will of course confirm this potential or possibility to probability.
Since you read my MIY post, you probably already understand why I believe Yamba represents SUF's short term salvation and long term (hopefully) future, but for those who did not, put simply, Yamba offers MULTIPLE PIPES with a tendency to above average size.
Since roughly 50% of NWT pipes are diamondiferous, multiple pipes in the market's eyes means LONG TERM CANADIAN MINE POTENTIAL.
If all targets are drilled, and every one that is drilled, turns out to be a kimberlite, that must be announced as material news. Every kimberlite that turns out to be a pipe must be announced, and every drill core that turns out to have an attractively high macro count or ratio, has to be announced. Finally, any unusually large diamonds especially any that fall out of drill cores, have to be announced. While ridiculously optimistic, that could mean 45+45+45+45 or as many as 180 news releases this summer. If I am only 10% right, that is 18 NR's on Yamba combined with everything else going on.
That translates into market attention and price appreciation.
If we start out with some early good news as outlined in my MIY post, the possibility evolving into the probability of a Canadian mine lasting between 16 to 30 years producing between 3 and 8 million carats per year at net average values of say $80/carrat, is what the market will pay attention to. Nothing else will sustain the market's serious attention in SUF. Only the promoted plays like Kalahari will benefit from the lessor possibilities.
SUF has RSA market psychological baggage, well documented in numerable posts to date. As the market slowly absorbs the (hopefully) mine potential of the Yamba Lake play, and if drill results can lend fuel to that realization, then not only will the stock take flight, but our RSA assets suddenly will be evaluated in a totally different light. They will no longer be short term pay-streaks in a play where SUF has questionable tenure, but rather, they will be the financial grease that will underwrite without dilution our ultimate goal, the security of long term Canadian producer status with world-wide exploration blue sky.
Reason #2
SUF is the guaranteed operator at Yamba Lake, and is in a position to assume a larger % of the play, if:
1) Work is required beyond the value and schedule of the existing agreement, which I believe, requires about $10,000,000 to be spent over four years. (This is year two).
2) Economic pipes are found.
3) There is a Feasibility Study decision. As noted, the three juniors are, I believe, only carried for the four years and 10 mil. After that, they would presumably have to give up a % to SUF in lieu of $$ contribution, come up with the cash, or sell part or their entire %. (I presume SUF has the right of first refusal upon an offer to sell.)
Bottom line, while SUF may end up with 40% of whatever is found at the Back Lake, SUF has 51% of Yamba and is in a position to reasonably assume another 25% with little more than the outlay of a duplication of its initial investment.
With the anticipation of SUF controlling 75% to 87% of a self financed Canadian mine netting say $600,000,000 annually without share dilution… I suspect the market will change it's attitude.
I'll let you do the math, but given this scenario or one that comes within 10% of it, I doubt $20 will be a satisfactory price for any SUF shareholder.
Hope that helps.
Regards
P.S. Hello Gemsearcher
Assumming the drill turned all weekend, the core will be visually inspected when pulled and any unusual (visible diamond) observations will be announced probably early this week along with the width of kimberlite interesected if greater than 25m. If the intersection is narrow (a dike) I doubt that the width will be annouced until more information can be found out through more extensive drilling.
Processing of the core probably will take at least two weeks for caustic fusion analysis so macro/micro counts, etc. will probably come later in the month. |
