Core Gold DMMIF

RE:RE:RE:RE:HANG ON A SECOND...SHOULDN'T THIS BE WORTH $2+/SHARE !?!?!?

[LittleOwl]

OH, I GET IT NOW !  From the previous posts it seems we have a case of "investor fatigue" and "doubting Thomases" here... That explains a lot.

Can't say I can blame you for your mindset but perhaps it would help if you could step back from the edge a little to recognize the new facts and changed reality both for the big picture as well as in this particular situation. 

I won't tire you with lots of details and mathematics, so let's keep it simple:

1) We have just been through a horrible 5 year bear market. WE ARE NOW BACK IN AN EARLY STAGE BULL MARKET SINCE JANUARY 2016.

2) Previous management was old, ineffective and tired. NEW TEAM IS HIGHLY QUALIFIED, MOTIVATED WITH A SUCCESSFUL TRACK RECORD.

3) Balance sheet and financials were a mess. BALANCE SHEET HAS BEEN RESTRUCTURED, FRESH CAPITAL ADDED AND RISK REDUCED.

4) A rising Dollar and falling Gold price wreaked havoc on costs. THE DOLLAR HAS AND IS FALLING AND THE COST STRUCTURE IMPROVING.

5) Once 2000 tpd is reached with positive cash flow, ADDING 1000 TPD TO 3000 IS NOT ROCKET SCIENCE TECHNICALLY OR FINANCIALLY.

6) To get to about 100,000 oz you can indeed increase capacity or you can increase grade BUT YOU COULD ALSO INCREASE BOTH.

7) Ecuador,rightly or wrongly, was seen as a snake pit. ECUADOR IS THE NEW ELDORADO AND IS ATTRACTING THE BEST AND BRIGHTEST.


You are correct in flagging the contractor's cut and we will need some clarification from the company on this. Is it 35% or 40% ?
In either case they are not giving it away as you may be implying since a cost for mining would have to be incurred anyway and as we all know this particular component can be the most volatile and can be the subject of endless conversations on whether it should be kept inhouse or outsourced.  Nevertheless my view is that at this stage in the company's restructuring and development this arrangement substantially derisks the operational side and frees up management resources to focus on other and conceivably more important issues related to growth and improving shareholder value. 

We have not even started to talk about the upside optionality here.
Has anyone considerd what would happen if / when both capacity and grade increase ? What about if price increases ? What about all three ? Can you fathom the potential leverage here ?
What about more drilling and exploration ? After all we are talking about Ecuador here. This is Fruta del Norte and Cascabel country !

Why just focus on the negatives from the past that look like they are history now that the circumstances and environment has changed for the better ?

And what about the global political environment ? Don't you feel some comfort with your little mine up in the Andes in a self-sufficient country that has now seen the light and is far away from the troubles of Europe, the instability of Africa, the insanity of the Middle-East, the crazyness in the US and the absolute madness of North Korea ?
Isn't that worth a little premium ?

I have been accused of exuberance. Perhaps... but is it irrational ???

In the end, as far as I am concerned, it's all about risk and reward; and, to be honest, it just doesn't get any better than this. 

If you can find another active mine in a good jurisdiction with attractive growth prospects and a 6 Million ounce resource at $4/oz and significant blue sky potential to boot please let me know, because I couldn't  !