Goldenrules wrote:
Just spoke with IR for about a half hour and got a lot of questions answered. I find EGX’s IR reps to be extremely knowledgeable and non-promotional. They represent a lot of mining companies so they can put things in perspective. If they can’t answer questions immediately, they get back to you.
First, they knew nothing about Ecuadorian law restricting major mining companies. It wouldn’t have made that much difference anyway as this deposit will eventually be bought out by the Chinese, who as I mentioned earlier, see things differently when it comes to long range planning.
The Guangshou Group is the JV partner on the Chinapintza deposit. They are planning to implement a mobile production facility that will produce about 5000 oz a year. This will be operational before the end of the year. It’s a restricted license that only permits a small amount of production. This will provide a little cash flow, but more important, it will tell much more about the complex geology and give more credibility to the feasibility study that will follow the PEA. As it is a mobile production facility, it could be moved around to test the other deposits as well. Guangshou is paying for the entire thing, so what does that tell you?
The PEA is going to be much more detailed than a normal PEA and by the early fall it should be close to a feasibility study. This is necessary because of the size of the deposit and the complex geology. As well, it is a good idea considering the distrust some in the West have for all Ecuadorian mining projects because of the Kinross fiasco.
The issue is not the gold, but the copper and with 2.3 billion pounds of copper, you want to be sure it is economic to mine. Gold-copper porphyry deposits are the largest deposits in the world and the largest are located along the Andes. Do some research and look at how much drilling they had to do to prove up Escondida, one of the two or three largest porphyry deposits in the world.
The 86 percent recovery rate refers to the Santa Barbara deposit, which represents about 8.5 million ounces of gold so were this strictly a gold deposit and if gold sentiment were a little higher, this would be an extremely positive story.
I also asked what the general analyst response to the NR was and not surprisingly, it was positive. These guys need hard data and the more they have the better. Today’s NR gave them an important piece of the puzzle as they now have a baseline recovery rate.
I’ve asked a few other questions that they need to get back to me with, but the more I get my head around this story, the better I like it.
This is options expiration week and lately that means an orchestrated takedown of gold. The lock-down in gold has existed since the Ukrainian crisis began. Like the London Gold Pool, it will blow up in the Western central bankers faces and that will happen when we least expect it. More and more informed investors are waking up to the realization that the opportunities in the gold market are a once in a lifetime investment at these prices. Finding explorers who have large, legitimate projects and buying them for pennies seems to make a lot more sense today than at any other time I can remember. No wonder guys like Rick Rule are so stoked.
Gold will turn around and probably this year based on supply demand fundamentals, India’s renewed buying, Chinese Russian buying, movement away from the petrodollar and global currency debasement. For those who can think long term ( like the Chinese), fortunes will be made. At some point in the future people will be telling stories about how you could have bought 100,000 shares of this company for $8,000. The same will be true of other stories like PLG, BRI, MGP and a few others I can think of off the top of my head.
Why anyone would be daytrading these penny stocks is beyond me.
Every one of the top ten reasons I posted a few weeks ago for buying this company
https://www.stockhouse.com/companies/bullboard/v.egx/ecuador-gold-and-copper-corp/2?postid=22609450 still stands.
Very good information. Thanks