This larger rig is not about resource conversion. The LF-70 is perfectly capable of doing that. What it can’t do, and RY has alluded to this on several occasions, is access the higher ore grades they have started to discover at the limit of the LF-70’s capability. The LF-70 may have a name plate range up to 400m but it will struggle to drill holes at depth efficiently. A larger rig with the capability to drill down to 900m will be able to drill down to 200/300/400 meters far more easily than a much smaller, less powerful rig.
It seems to me that the LF-90 has been brought in to drill at depth while the LF-70 does infill drilling of the shallower deposits. Drill results so far show that the deeper we go the higher the grades. If this project is going to be developed in the current market we need much higher average grades than 0.55%. It’s anybody’s guess as to the grades that might be discovered the further down we go but if we are getting 0.55% 50m to 100m down, 1%+ 200m to 300m down then what chance 2%+ 400m – 500m down? If you look at some recent Australian nickel sulphide discoveries the higher grades have been at depth and not just below the surface. I suspect this is the reason for the purchase of the LF-90.
We have $6m left in the bank for OPEX, consultants, lab tests etc. That’s not enough. Once the auditors have finished expect a fund raiser of some description. Also expect Amur to continue to drill and prove up as an independent for at least the next 15/18 months. They’d be mad to be speaking to anybody about JV or TO at this stage. Full value will only be achieved once they know exactly what it is they are sitting on and at the moment we still have quite some way to go before we have done that. We have only scratched the surface.
RY has given enough clues to be able to see the path ahead. You just need to read the signs. This second rig should come as no surprise. Funding and Amur remaining independent shouldn’t either.
Through the acquisition of the additional rig, the resource conversion effort can be accelerated allowing for resource upgrade and recalculation of reserves earlier in 2016 than planned if a single rig was available for drilling.
WRONG Glazking......naughty boy. Read it properly please. The RNS states that the 2016 resource upgrade and reserves increase will be announced earlier with 2 rigs. This is NOT referring to the upgrade due in December from this year's drill program
Stocks are allowed to go up, after stock has been accumulated at the lows & news is due to be reported. Then stock is sold into the rise known as a profit release cycle. After a high has been formed, the walking it down process starts to extract money in that phase & so it goes on generating money. It wouldn't be wise to short into a rise because you need to close it at a lower level, however mm's may do so, to take an average position up above the bid & thus flatter the position value, so there is no loss.
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