MD&A Dec 31 2015As at December 31, 2015, the Company had a working capital deficiency of $11,210,928 [December 31, 2014 - $11,104,094] which included a liability of $11,221,485 [December 31, 2014 - $11,056,485] under its Loan Agreement and Grid Promissory Note due to Mr. Rassmuss, the Company’s controlling shareholder. Mr. Rassmuss has confirmed to the Company that he does not intend to call these notes in 2016. The Company has also incurred net losses of $111,450 and $418,831 during the years ended December 31, 2015 and 2014 respectively and has yet to achieve profitable operations, thereby accumulating a deficit of $22,298,795 [December 31, 2014 - $22,187,345]. These continuing losses cast significant doubt about the Company’s ability to continue as a going concern. Accordingly, the Company will need to raise additional capital through equity issuance or through its significant shareholder in order to continue its operating, exploration and evaluation activities or eventual development of its properties. The Company’s sole source of funding since 2000 has been through cash advances from Mr. Rassmuss. Given the concentration of the Company’s ownership in its principal shareholder, its current working capital deficiency and continued weak commodity prices, the Company has little prospect of refinancing or continued solvency should the current outstanding Grid Promissory Notes be called for payment in the future.
The Company continues to investigate options to advance its geological and economic models while minimizing its environmental footprint.