ProShares Short SmallCap600 T.SBB

RE:RE:RE:RE:Anyone selling now

[AlwaysLong683]

SBB's decision to build Goose Mine at Back River themselves instead of selling the company to a major at a premium means:

1) They are likely stuck with their decision until they finish building the mine and start pouring gold since majors typically like to hire their own contractors, engineers, source their own building materials. etc. SBB has already entered into agreements re. financing and mine build work, so majors will be less interested in assuming what SBB had already agreed to unless they can acquire the company at a real bargain price. After SBB finishes building the mine and starts pouring and selling gold, majors may become more interested.

2) SBB is building a mine in what is now a high inflationary and rising interest rate environment. Thus, they are more likey to go over-budget and / or experience delays before the initial build is completed as they still have 30% of the mine build costs remaining to be negotiated (see  page 17 of SBB's June 2022 Slide Presentation). A recent estimate by SBB for the initial build is $610M CDN. My hunch is the final price tag will be significantly higher than this.

3) The first pour of gold is currently estimated to be in Q1 of 2025 (see page 21 of SBB's June 2022 Slide Presentation), over 2 1/2 years away. That's a long time for investors to wait for a payoff re. gold production and whatever profit margins SBB can generate at that time (again, provided that the mine is completed and operational on time and on budger).

4) The gold stream acquired by Wheaton in the financing of the Goose Mine project means SBB will have to cough up some gold production to Wheaton once SBB starts producing gold.

Will be interesting to see what happens over the next few years in terms of SBB's progress in building the mine and its share price during this time.