Updo one has to differentiate between retail investors and mining companies. Clearly Freeport McMoran were not in the least spooked by Bre X when they decided to explore at KSK (and as you know it was Freeport who were brught in by President Suharto to examine and who quickly blew the whistle at Bre X). As for the perceptions of retail investors, I'd be surprised if Bre X still dominates their thinking. Changing the name to Asiamet should help somewhat. In the aftermath of Bre X, and if the sole intention was to prove a copper porphyry naming the company "Kalimantan Gold" wasn't exactly the smartest branding. My recollection was that the original search was for gold back in 1980. Subsequently attempting to jump on the coal bandwagon was seen by most as a deviation from the original objective which was to focus, geographically at least, on Central Kalimantan.
In Kalimantan there are coal seams by the bucket load and plenty others minerals but none yet discovered in a large concentrated area. KLG has been trying for 30 years for a breakthrough and prove that large gold and porphyry Au/Cu deposits does exist. KLG was launched on the coat tail of the Bre-X saga and with the Bre-X fiasco it is no wonder that lot of people are staying on the sideline until its ghost is put to bed once and for all.
Sold my small holding today as need cash elsewhere. Will be back in here soon enough and had nothing to do with my hopes for this share. Things have gone a bit quiet again, so thought I'd take the chance!
Again, good sounding logic and we all hope you are right about that. In the current circumstances TM's step-by-step-low key-well-defined-achievable-target approach is preferable to elephant-hunting-without-time-horizon (although, lets be honest, everyone thought that elephant hunting was good fun while it lasted). However, another key difference is that with Freeport McMoran paying for everything there was no need for ongoing equity placements. Now, in this new era with Tigers Realm, KLG has periodically to go cap in hand to the market for more money. That's the rub.
There's one key difference between this Tigers Realm era and the Freeport era. Freeport were looking for 'the big one'. The longer they drilled and didn't find the big one the price was always going to fall.
Tony Manini has a clearly stated aim of getting a smaller mine with a very near surface deposit, into production in a tight three year timescale with a clearly defined plan of progression. So as each hurdle is overcome I would expect the price to climb.
I am sure we all hope you are right about that. Your reasoning sounds logical. I just come back to that quote a year or so back where someone wrote that micro cap explorers were in the business of selling dreams to dreamers in a seemingly never ending process of diluting shareholders to oblivion. I don't pretend to understand the way markets work for micro cap explorers listed on AIM. However, you only have to take note of what happened to the KLG share price during the three year period when Freeport McMoran were on the ground. The share price went into a steady decline and that was despite a longish period without new equity placements culminating in the encouraging drill results at BK. In other sectors - for example in the five star hotel business - it is often the case that the real rewards are only reaped by the third owner. Perhaps in the case of the prospective copper mine at BK it will be the mine developer who reaps the rewards rather than the explorer. If that is one and the same entity, i.e. KLG, we should all sit tight and grit it out for the next three years regardless of a lack lustre share price performance and hope that Tony Manini finds a way to prevent too much further dilution. More than happy to be proven wrong about this.
For me the balance of probabilities must surely lie with the second synopsis. For the following reasons; We have had further drill results that have equalled or exceeded expectations of the CEO. From what has been indicated further drilling is likely to expand the potential resource zone over the coming months with regular news flow and updates. Very much tied to this is the expected resource upgrades due in August and December/January. Furthermore the CEO is actively engaged in promoting the company as evidenced by interviews, presentations, director buying and the company name change. I'm sure that the management will do everything in their collective power to ensure that a future placing (should it be needed) will happen at a higher price than the last one.
Sure, it's only guesswork. My guess is that there are approximately 100,000,000 KLG shares in the hands of less than fully committed investors and that this could extend the overhang for some time, possibly all the way to the next equity raising. Wrightman's guess is that there is a significant body of new investors who are in mainly because of their abiding trust in the new CEO. I reckon the next six months might provide a better indication than we currently have of where the balance of probabilities lies.
It's impossible to know 'what level of commitment' any holder has. Any attempt is guesswork and nothing more. It's also impossible to know who's buying, who's selling and at what level any individual would be willing to buy or sell at unless you are privvy to inside information. To try and guess is about as useful as trying to guess where the daily price is gonna go. We will know when the overhang is clear when the price starts to move up. We know from experience that it sometimes does this quite rapidly. Once it does start to move those sitting on the sidelines and those trying to build a stake gradually at the lowest possible price will be forced to enter or be left and this will add further momentum and impetus to help propel the share through resistance levels and start us on an uptrend.
You might be right about that; let's hope you are. However, 80 million KLG shares have been traded in the last month mostly at weak prices and there's little indication yet that buyers have difficulty accessing shares. I suppose the next six months will provide a better indication of the level of commitment of longer term investors and the strengthening of demand from newcomers.
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