Risks
As far as my DD goes, there are three clear risks with the Springpole project:
1. First Nations. For me this is the number one issue. It's my understanding that relations with First Nations are excellent and that a formal agreement is in the works (year end/early 2013). If First Nations are on side then progress and wealth can be made here. Detour Gold handled this PR aspect perfectly, Taseko not so much. To be fair, I think Ontario is a much better jurisdiction for this type business than the rest of Canada. In short, I think management are well aware that FN must be part of the process as risks 2 and 3 are impossible to overcome without their backing.
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2. Water management - "The lake". If this was going to be an underground mine I think I'd walk away. However, this is an open-pit project. This makes all the difference in the world. The shallow lake/water management is a relatively easy fix from an engineering standpoint.
3. Environmental. If FN are on board then a mining friendly jurisdiction will not get in the way of future tax revenue and valuable job growth. Mining is in Ontario's DNA.
Other risks like gold price and junior market sentiment are out of GCU's control. I'm mentally prepared that all juniors could remain in the penalty box well into 2013 regardless of fundamentals.
I want to be very clear on one macro issue. The EU can't be fixed. It's mathematically impossible to fix Europe's problems, there're simply not enough productive assets to service their existing debt. Euro bonds will only buy Europe some time (a year max), however, it will not cure any of its many structural defects. Debt problems in Europe, Japan, US and even Canada are the real price of gold's best friend and the real price of gold will determine the gold’s sector long term fate.
It goes without saying GCU’s growing resource size, metallurgy and grade are top tier.
GLTA