Baru Gold Corp V.BARU

RE: cut n paste from another bulletin board...

[Miwah_]

from the coffin brothers,
East Minerals (EAS-V; $3.94) did have a surprise in store when it released the initial resource estimate for Miwah but it wasn’t the positive variety. EAS was punished for a generally disappointing initial resource number. The initial calculation gave an Inferred Resource of 103.9 million tonnes grading 0.98 g/t gold & 2.68 g/t silver yielding a gold equivalent 3.28 million ounces at a 0.2 g/t cut off and gold and silver prices of $1185 & $20/oz respectively.
This is obviously less than we, and the market had hoped for. The news release did not detail the “top cuts” of 20 g/t on the high grade areas and 1.7 g/t on the low grade areas that came out of the resource estimation algorithm (inverse Kriging). The average gold grade is lower than we would have expected and the data available to Kriging algorithm might account for some of this. That’s purely speculation however, that would only be borne out with more in fill drilling. We expect the company will focus on step out rather than infill drilling in order to show Miwah can keep growing.

Management noted that Miwah is still open in most directions and that there are already holes outside the resource block in several of these areas. Two drills are currently working north of the resource area to push the zone closer to Moon River. While it’s quite possible infill drilling alone can have a positive impact the market will be in a “show
me” mood after this resource estimate. The current valuation of sub $300 million for a company with 4 million plus ounces (between Miwah and Sangihe) is not high. The negative surprise clearly generated some selling in anger, including a few large market orders. Once the market settles it will take some strong holes outside the current resource block or settlement of the forestry tenure issue to really lift the stock. The timing of the latter in particular is unknowable so we’ll have to wait for the dust to settle and volumes to drop off as disappointed traders exit. Work towards the creation of the spin out companies continues and we expect to see further news and some indication on the timing later this month.

We won’t pretend we’re pleased by the resource number. It was an unpleasant surprise but it doesn’t and shouldn’t take away from management’s achievement in the finding the ounces they have to date on a project that is still likely to grow. The stock will likely settle in at its current range, and can lift with strong extension results or an end to
the forestry concerns.

https://www.eastasiaminerals.com/

AND:

No one from here has discussed EAS with me forquite a while now as I have not been engaged in comments regarding EAS. Iam not sure if my comments will be totally objective as I am more thandisappointed in the down turn in the SP that will in turn cause some(good) folks to sell out at a loss. I know enough to expect that furtherdrilling will bring in enough additional ounces to get the SP back to$6-$9 range over the next 8 months; this is a lot lower than my originaltarget of $15-$28. The problem is that EAS is not very aggressive withtheir drill campaigns based on their love affair with controlled frugaldrilling to prevent wasted dollars, which in turn is suppose to decreasespending and dilution. There is something to be said for controllingdilution and there is an equal argument that well managed drill dollarsis considered an investment and is not seen as an expense.

Isuspect that Mike is trying his best to set the table for an attractivebuy out of Miwah and to accomplish this he has been exerting a lot ofenergy and time into managing environmental, NGO, and accommodationfunding for local communities. Operators searching for acquisitions arealways wary of the uncertainty and more importantly the time lossdollars tackling these issues after purchasing a deposit. A junior thattakes the initiative to address these issues will have a much moreattractive deposit to sell. The problem is managing these issues candivert you from the main goal of a well managed and controlled dillcampaign that clearly identifies the economic value of your deposit. Notknowing the average grade in the drill campaign would translate to lessthan 1 gram per tonne is an oversight in my opinion, or possibly worseand I will not comment on that. You would think that a little “Whittle”(a pit optimization package/model) would have kept the drilling ontarget to obtain the most ounces per foot drilled to meet 43-101standards and we would have shown more ounces for the footage drilled todate.

I would think that concern for SP stability to some degreeis owed to the investors. Responsible non-exaggerated reporting ofexploration results is needed. At least they have dropped the term“contiguous”, but the term “open in all directions” still skews theintegrity of their latest news release.
Yes I think the SP will comeback (somewhat), but in my opinion waste gaps (as seen in their latestcross section) from intrusives has decreased the blue sky potential ofthis deposit in the immediate drilled area. I hope I am proven wrongwith step out drilling, but Sipopok so far has not hit anythingnoteworthy.

There is nothing wrong with 3 million ounces as thereis nothing wrong with a half-ton truck, unless you expected or wantedmore !

Cheers and Safe Mining

Mucker

*SIGH*
The Sisters

ps: any comments from the board....btw..what happened to supercycle?