KLONDEX MINES LTD. T.KDX

True North Story

[JintsuGehan]

This is a direct cut and paste off the 2017 new Technical Report prepared for KDX: After investing approximately C$375 million in capital since 2007, including the extensive underground development and modernizing the process plant, San Gold ceased mining in May 2015, and placed operation on care and maintenance. San Gold declared bankruptcy and announced sale of all of its assets to secured creditors in June 2015. Historic Production at Rice Lake Mine from 2007 through 2015 is summarized in Table 6-3. In early 2016, Klondex Mines Ltd. announced acquisition of 100% of the Rice Lake Mine, process plant complex and a 400 km2 exploration land package from the creditors. In the first half of 2016, Klondex commenced refurbishment of the underground infrastructure and commenced trial mining on readily accessible ore. Historical Production under San Gold: Year Tons Processed Head Grade Gold opt g/t oz 2007 96,653 0.13 4.35 9,193 2008 116,835 0.09 3.20 13,845 2009 164,424 0.23 8.00 35,154 2010 275,860 0.17 5.85 47,082 2011 461,150 0.17 5.93 79,802 2012 629,279 0.15 5.07 93,233 2013 641,711 0.13 4.32 80,828 2014 390,564 0.12 4.03 41,890 So in 2013: 80,828 in 2014: 41,890 Plus the over $ 30 M spent before San Gold in 2005, so around $ 400 M sunk into the entire development of the Rice Lake Mine, and KDX paid $ 32 M!!! Insane when you look into the history of the story...cmon now Huet & Co. it's time to produce 40,000 oz. in 2018 let's get moving....what the market DOES NOT want to see anymore is CASH BURN on an asset that was acquired for just $ 32 M..it would become a wasteful investment. Spend the minimal to refurbish and restart the mine, and get those oz. going or else PRESERVE CASH and focus on Nevada especially with the great results out from FC and Hatter Graben is half decent and looks promising. I think this was Jeff Kileen's point and the red herring of all things has now become True North over Hollister. See Kileen's revised PT of $ 4.25 from last week. He went from $ 6.00 to $ 5.00 right after earnings to now $ 4.25 just last week. He is sharp and on the money. He called the chaos at Asanko Gold w/ Nkran and the issues...and Asanko is at 79 cents but that's a whole other disaster. Please Huet get True North up and running efficiently or else re-focus your strategy and eliminate this ridiculous cash burn. JIN

[tjw4]

These are 2 very different stories. Asanko purchased property with fraudulent resource projections. K2 is one of the major funds shorting Asanko and K2 was one of the major initial backers of KDX. K2 also has former employees that moved on to work at KDX.  KDX has their own issues but it is not a fraud and it has real assets, they are simply doing a poor job of maging cash flow, media

[goldminer01]

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[tjw4]

I agree, that will be the strategy under promise over deliver like it was before, but it will take a long time to gain market confidence again. Without a large rise in POG we are in for a slow turn around.

[goldstd69]

those sentiments are classic signs of a bottom...jmho

[Cashcosts]

What makes Huet so much smarter than the guys who couldn't make it work with 375$ million?  Just bc someone sunk 375$ mln into a project and KLDX bought it for 32 doesn't mean its a good buy.  I never understood this argument.  Rob McEwen is making it with Black Fox.  It doesn't make sense.  Why would anyone buy and asset that has sucked 375mln into it and

[JRafflesUK]

There are three matters that finished San Gold:- The ~ C$375 sunk into the Rice Lake mine was mainly funded by debt. San Gold was mining large volume lower grade gold. The POG was about C$1300 at the time that it folded. However, when the POG was ~ C$1900, TN was a C$1bn mine.

[goldminer01]

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[tlee10911]

LOL! Oh come on JitsuGehan (aka Jeff Killeen). Is your confidence in your ability to make a good stock call so shaken that you have to come on these little retail bullboards to pump yourself up? Jesus haha!!

[JintsuGehan]

Is that a joke??? No I'm not Jeff Killeen from CIBC... W*F? I was using his name as he got the selling going during the Q3 earnings call when he started talking about True North and then asking how much care & maintenance would be monthly. He was the one analyst who actually questioned Huet intensely...a good thing. Huet sounded just dumb and clued out which also didn't help

[tlee10911]

Haha, thanks Jeff. Let me know if you want to grab a coffee. I'll buy.

[goldminer01]

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[JintsuGehan]

Good points. I don't know what the hold up is to be taken over. Ultra safe jurisdictions. This is puzzling. Even just go for a hostile takeover. There's been basically 0 M&A this year in midtiers besides Richmont takeover. So I think the industry is just afraid.  BoD probably does not want to sell. See one of Huet's interviews in January 2017 either Financial Post or

[goldminer01]

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