Elgin Mining Inc ELGMF

RE: time to sell?

[bullionbruce]

Hello billbuckner,

 

I enjoyed your posts back in the GOZ days, as well as those of JohnM3 and, since the merger, those of boreps. All very interesting and informative.

 

Excellent post, and you may be right. I have a different take though. First, as to the macro environment I believe the situation is quite different than is was in 2008, at least in terms of the miners. If you recall there was a very long topping process coming off the huge run up to 2006, and of course that culminated in the waterfall sell off during the panic of 2008. At the moment though we are sitting right near those 2008 lows (in terms of the miners in relation to gold), and I see this as a more likely long term bottom. My analysis of past gold bull markets also supports this as a possible scenario. I am far from an expert though, and in my 20 years of miner investing I have certainly made my share of mistakes! As to ELG in particular I think we are in a much better position now with our new management/board and with Lupin. I have had experience with both Dowey and Buchan and believe they are among the most capable in the business. The optimization process already underway at Bjorkdal, along with the recent (Oct 22) drill results there give me confidence that the 40,000 oz/year days are behind us. The recent drill results from Lupin do not concern me. As boreps pointed out, this represented the last of the flow through financing regional drilling. It is my understanding (confirmed in the Nov presentation) that they are looking at shallow portions of WZSOS and possibly L19 for mill feed into initial production. My take is that Buchan more than anyone is aware of the potential at Lupin, and his involvement more than anything else gives me confidence. If you haven't seen the Nov presentation I would have a look. They are showing a Q2 2013 PEA date, let's hope they can stick to that and that it is as robust as I anticipate. I haven't got a handle on Lupin capex (apart from the 50m from the 2008 PEA, again from the Nov presentation) but I do believe the plan is to finance with Bjorkdal cash and warrant money. And along those lines Dowey certainly must be motivated to get those warrants in the money ASAP. Good luck to all! Bruce