The following is from Damier's 2018 response to Vango's takeover offer*. Dampier is responding to an unsolicited takeover, and advising their shareholders not to accept the offer.
>Vango and Dampier both have an interest in the K2 Project, which is the most advanced project in Vango’s portfolio.
>If you accept the Offer and receive Vango Shares, you will be diluting your interest in the K2 Project and taking on greater exposure to Vango’s less developed and riskier project portfolio.
>Other than the K2 Project, which is near to development, Vango will need considerable exploration and resource evaluation capital in order to advance any of the Plutonic Dome Gold Projects.
Trident, Vango’s next more developed project, has well known and significant technical extraction risks which may make it difficult, if not impossible, to mine.
The Dampier Board notes the following in relation to Vango’s Trident Project, on which it appears recent positive moves in the price for Vango Shares are based:
• the Trident deposit has well known and significant technical extraction risks which may make it difficult, if not impossible, to mine. In particular:
o the geology and extreme deformation in the ultramafic host to the Trident mineralisation (the sequence is extremely sheared and folded with very high-water flows into the host stratigraphy) give rise to significant concerns regarding the ability of the mineralisation to be extracted by underground mining methods;
o the geotechnical aspects of the mineralisation are likely to provide extremely poor ground conditions for underground mining; and
o previous attempts to access the deposit via a box cut and decline were unsuccessful primarily due to very high-water inflow into the decline;
• 56% of the existing mineral resource estimate for Trident is in the Inferred Resource category, which represents the lowest level of confidence;
• the existing mineral resource estimate for Trident was reported by Dampier (when it owned the Plutonic Dome Gold Project, which includes the Trident deposit) under the 2004 JORC Code;
• given the geological and geotechnical concerns referred to above, it can be expected that any underground mining would be subject to very high dilution of the ore with the surrounding barren or low-grade host rock. This means there may be concerns regarding the Trident mineralisation being able to be classified as a resource under the 2012 JORC Code;
• recent drilling by Vango has focused on the potential resource extensions to the main Trident deposit and as such most of the recent drilling is along strike and below the current resource estimates; and
• to properly assess Trident, detailed exploration and geotechnical work is required which is expected to be at a significant cost.
Dampier believes there is considerable risk that the Trident project is likely to be uneconomic due to geotechnical issues.
*https://hotcopper.com.au/threads/ann-dau-supplementary-targets-statement.4498051/