Oromin Explorations Ltd OLEPF

RE: Guru has skin in the game and is losing

[dmuy]

Some questions you might want to ask yourself:

• Why is TGZ so anxious to shore up its near term balance sheet and cash flow by high grading and closing out its hedge book?
• What is the biggest issue investors have against TGZ?  Perhaps lack of reserves to feed their expanded mill?
• Why are they drastically cutting back on exploration expenses if they see organic growth as a way to answer their resource/reserve issue?  They say it’s a response to low gold prices yet they also say their margins will increase since the hedge has been closed.
• Why are they deferring bringing Gora into production when they mention how accretive it is since it will feed their existing mill? Do they thing they may not need it as much?
• Why are they “telegraphing” their intention to buy out OLE? Is this normally what an acquirer in a position of strength does?  I think it’s because they know that their shareholders also want them to do this deal.

I think it is inevitable that a deal between OLE and TGZ will get done, not because OLE has no other option (the FS show the deposits can hold their own without TGZ); but because it makes sense.  The IIR will go through the roof if they don’t have to build their own mill. I think it will be largely a paper deal for TGZ stock and some cash; but that’s OK since it will transform TGZ into a very profitable operation. Who knows when the deal will get done, but who cares.