2% NSR onSG + worst decision everHi Tannin
Abcourt has already made 2 PP this year.
It is supposed to merge with Pershimex (if it does that should bring$1.5m on 5000t).
Sleeping Giant is close to production.
Abcourt NEED to hire an accountant to evaluate future deal because this
2% NSR wasn't calculated by an accountant.
Just a few point to analyze.
Is Sleeping Giant close to production.
Will new drilling at SG increase the reserves.
Will the production be 10k oz per year for life or 20k oz . .
Will the price of gold be $1500,$2000 ,$2500 $3000us in 3 years.
2% NSR on 10k oz = 200 oz \ year Return 20k oz = 400 oz /year return
at $1500 200 oz = $300,000 15% 20k oz = $600,000 30%
at $2000 200 oz = $400,000 20% 20k oz = $800,000 40%
at $2500 200 oz = $500,000 25% 20k oz = $1,000,000 50%
at $3000 200 oz = $600,000 30% 20k oz = $1,200,000 60%
Shareholders were complaining that the 2% given to Mr Hinse was the only profit
that Elder could create and was given in NSR.
Now the same will apply to Sleeping Giant.
Any bank will give a credit card at 15-19% to anybody.
It woud have been a better bet to ask for a credit card at 19% that could be repaid at
anytime.
Now we are stuck with a 2% NSR .1% can be bought back for $6m
0.5% can be bought back for $2M in 3 years and another 0.5% in 6 years at $4m.
How many other deal like this one can be expected in the near future.
If my way of thinking is wrong please feel free to debate and correct my errors.
Fernand