Voltalia Ord Shs VLTAF

Deal of the Century

[ALLEN4]

Good description GD1, at least you are open to the possibility of a happy ending here.  The story is not over, not by a long shot.  Even if the POG were to drift for several months or years, the gold remains in the ground and we have a deposit that surely works at higher gold prices.  What Kaiser says about juniors generally applies absolutely to Volta;  that is, we are a leveraged option on the price of gold  If we eventually hit 2000 POG, which not long ago forecasters were almost unanimous in predicting, the our NPV for Kiaka is at least a billion dollars.  That would translate into a market cap more than a hundred times current market cap.  That's Kevin means by being highly leveraged to POG. 

We have five million ounces of gold; and at some point, whether its 1350 or 2000 or some other number the development of Kiaka would be economically viable.  So I suppose if you believe that POG is going to have a final resting place somewhere beneath 1350 then you need to be concerned about the future of Kiaka.   This current emphasis on treating gold mining companies like any other business is wrong headed in my view, for the simple reason that we are worth something whether or not we are producing and making a profit.  5 million ounces of gold, albeit in the ground, is an asset any way you look at it.  Whether you hold bars of gold in a vault, or shares of a gold mining company with proven reserves, you still own an asset.

So I have no difficulty owning a leveraged option on the price of gold.  At some point we need some more cash.  Gaoua can be sold at a firesale price if we get desperate or some form of financing will take place, not for 400 million to develop Kiaka but money to keep us going for another year or two;  don't think we can raise a few million for that purpose, think again, we have credibility in the mining and financial community.  Money to keep us going is a no brainer; we are not simply going to run out of money and go bankrupt after our ten million runs out.

So I am expecting a turnaround in the price of gold and will hold out until then;  that's what is going to saive us in my view.  As for developing Kiaka on a smaller scale, I am more skeptical, but curious to see what they come up with.  I have always understood that there will be an enormous capex to get Kiaka going;  This is all set out in detail in the PFS.  How much of the capex can be eliminated just by going smaller scale?  I would have thought that most of the capex is needed whether we go small scale or large scale.  But lets see what they come up with.