RE:Indicated Reserves -ouchThis shouldn't be new informaton to anyone who has followed the company last year or so or at least glanced through their presentations. But with that said I agree with your assessment fully.
They lagged their aggressive goals to expand the resource base presentation after presentation. In the end they've expanded it some, but they couldn't hit the home run to prove there's enough in these two areas to be mined for more than 7 years combined. I'm not disappointed. I like the company, I like the approach of green, effective mining to take those small deposits out of the ground other have neglected, but I fail to see a barn burner reaction from the markets to this PEA.
LOM greatly affects the result of NPV which is the ultimate key of attraction for headline reading retails. Results are positive. They have the grade and the project is mineable near surface. They'll be making money. The initial capex cost under 100 million is manageable, but will propably require a lot more dilution so it's a bit of a certain drill hit to the bunghole of longs. There's hardly any promo so I don't see big moves in the future. The reaction of institutes will determine alot.
They said a year ago management would be buying, but I'm not sure they have. No SEDI reporting has occured and what disturbs me the most is the delay from august to december due to "some engingeering work". How much it affects to every step afterwards and was it really about expanding the resource and including the data to the PEA because I don't see any notable change. Plus Alistair said couple times that the capital cost would be within tens of millions indicating something around 40-60millions not increasing dramatically with moving from the first chosen target to the other, but we see now increase nearly to double.
So I'm left asking more questions. I'm holding, but not buying more unless I see some conviction to the numbers of this PEA from the market.