RE: RE: newsEkim, you've hit the nail on the head with the last comment about funding for next years' program. This is where a lack of focus on exploration really hits this company hard. It will be interesting to see what kind of interest Freidland and the rest of the crew can generate at this week's conference without anything substantial, in terms of new finds, to talk about.
Imagine showing up at a meeting with prospective investors (or BHP) and saying, we spent 25 million this year on exploration ... how did that go? ... well we hope it will pay off next year ... so what do you want money for ... well to do the same sort of thing over again ... only more of it.
I used to have a lot of confidence in management of this project, however i must admit i am quite discouraged at this point. What has now become apparent to me is that managment realized part way through the summer that the prospects of finding another large potential kimberlite were dwindling (they may have even known this last year). This is fine as there is probably enough there to make a mine feasible, if what is there is as good as it could be or better. I do take issue with the fact that management seems to have clearly known where this thing was going all along, but they have only chosen to disclose it at a time when they would naturally be releasing positive news, and i note they did it on an otherwise terrible market day. All of which causes me great concern as management of this company seemed previously to have been very forthright in their reporting. When news has not gone their way they have diverted from that and have kept small investors in the dark. Furthermore, on the basis of one of my recent posts, wherein i posted a response from the company's investment relations person saying news would be forthcoming in a few weeks, detailing their summer's work in preparation for next summer, it is obviously they have known since that time that they have nothing to report other than that they are trying to plot a plan for next summer.
This being said, i am still willing to afford them the benefit of the doubt. There is opportunity to get this thing moving back in the right direction, as when you think about it, it should now sit at roughly the same price it did when we had our last news of last year (say $3), noting that there are now a very defined number of outs (to draw a poker analogy) for the company. We have a few chances to strike it big. The company is going to have to be very strategic as to how they manage news as if they hold everything back and report it all at once i doubt they are going to be able to garner enough interest in the stock to drive the price to the point where a financing for next year's operations will not have an exceedingly dilutive effect. I have confidence that the potential is there for this to be done ... but screwing company investors around has got to stop in order to make it happen.
I note that the skeptic in me also wonders if this is a long term play by BHP. Ie - if BHP can keep the share price down now, it is apt to stay down where it will present a much better takeover opportunity for them going into the future. Given that they now hold a 51% interest in this property i think we would be foolish to think they are not playing whatever cards they can to try to keep the shareprice at a reasonable level to try to maintain their upside potential in this project. It will be interesting to see whether PGD is operator for next year, and if so what the funding arrangement is.
Here is where the geologists work stops and the horse trading begins. Freidland has made hay at this game before ... lets hope he can do it again.