Member Info for Boffin

Like the sign at the pub "Free beer tomorrow"

Personally very happy with what they are doing. Yes its a bit delayed from what we all probably hoped for but its good news that they are doing a quality job for at least two reasons.

First getting as much information as possible at this stage can improve accuracy as well as time and money on future sampling to get a JORC classification.

Secondly they wouldn't bother setting up such a high quality lab facility if they didn't have high confidence that it will be worth it.

And as for the results its a bit as I suggested a while ago. There is quite a lot of fine gold as well as the nuggets. Very encouraging local concentrations of gold is my reaction but overall quantity far from certain.

I suspect that as is often the case in the UK it will be the time taken for planning permission rather than time for construction that will be the rate limiting step.

Waiting is always frustrating for everyone including me. And I did expect getting results from Creswick to take a while!

The following scenario may be wrong - none of us really knows- but I am mildly encouraged by the fact this is taking some time. The longer it takes it suggests to me that they have decided to assay a lot of whole bags, maybe all of them. Why would they do this? Perhaps because they have found quite a lot of finer gold as well as nuggets in at least some of the bags. If they have they will want to get as much data as possible as to where and at what depths the gold actually is and where it is not. The drilling system they have been using isn't great on precision but of course its fast and much cheaper than diamond core drilling but well investigated could be a good guide to optimising future sampling. Plus if the results are looking quite good ( or he says wishfully very good) they will want to be doubly sure before making a public announcement to minimise the risk of issuing misleading info. They may even get an independent expert to double check the findings and conclusions. Also they may want to have done some planning and preparation for what comes next so that they can include this in an RNS to manage all our expectations going forwards. All that of course takes time.

Its not the only possible scenario so don't set your hopes too high but I feel moderately encouraged!

Who knows how much gold we eventually find but I wish I had bought shares in the testing laboratory they are using! ECR must be keeping them very busy!

SolGold is actually far more about a large copper resource with a valuable gold "cherry on the top"

Whilst I don't expect it at this stage I certainly can't rule out meeting the "inferred mineral resource", the lowest classification in the JORC hierarchy, for at least part of Creswick. This the part of a mineral resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be of limited or uncertain quality and reliability.

Better than nothing of course but even if it does happen I wouldn't anticipate a huge SP rise ( unless the numbers are truly enormous) as there are way too many uncertainties to put a reliable estimate of actual quantity of gold let alone the final profitability after recovery and refining.
Given what we already know I think it highly improbable that we could reach either of the next JORC levels, either an "indicated resource" status let alone the "measured resource" status. The latter gives a very high level of confidence in the quality ( ie g/tonne|), structure and volume of the ore body enabling a high level of confidence of the quantity and thus value of the "gold in the ground".

I suspect the latter is as far as ECR may well take it and then sell it on. The reason for this is the next stage, to convert a JORC resource to a JORC reserve status is a great of work. It requires doing all the mine design, permitting, capital costings (including quotes for major items), and determination of what is economically recoverable as opposed to what is there. To me ECR aren't really set up to do this ( they are really an exploration set up) and would perhaps do better to sell at a decent price to someone such as Newmont who have a department in house set up to do just that. It also brings cash in earlier and reduces risk. They could always try to get a profit share arrangement as part of such a deal and not just cash.

Just my views on the likely next steps. Of course I could be totally wrong!

Its illegal for Directors to trade in shares where they have inside knowledge of share price sensitive information that is to be imminently released. Its called a close period. https://www.investopedia.com/terms/c/closeperiod.asp
Primarily this covers trading results info but applies to anything eg for ECR they may already have a good idea of how the Cresswick data is turning out-good or bad. If they were to trade on that knowledge they could be prosecuted, have any profits made confiscated ( disgorged is the legal term) and be disbarred from holding directorships in publicly listed companies. They can trade for a limited period after such an announcement but cannot if a further announcement is likely. For ECR with so many prospects that could report any time it can make such opportunities rather limited.

JORC has quite a few standards of compliance . A simple outline is available on Wikipedia https://en.wikipedia.org/wiki/Mineral_resource_classification.

Once you have sufficient data and analysis your own "competent person" can simply declare that a certain standard has been reached. They will usually consult with an independent competent person as part of this but that bit is quick.

The real issue is what is enough data and precision? That is hugely dependent on whether for example its a largely uniform continuous ore body or if it is highly fractured multilayered etc when it becomes much more demanding to determine just how much ore there is, how deep it is and eg how much additional "gash" will need to be removed to get at what you want.

With respect to Creswick my hope is that the results we are waiting for will enable us to target a second program of drilling to get us to at least a probable resource standard. But how much drilling that will take? - well we need the results but the description so far suggests that this is quite a fractured ore body. They may though for example just choose to focus on one or two most promising sections to more quickly get a JORC classification for that and leave the rest for the future but I guess our new geologist is there to make those kind of strategy calls. I certainly can't.

I very much doubt it. The type and quantity of drilling so far is unlikely to give a good enough definition to the structure and volume of the ore body as to allow sufficient reliability even at the lowest JORC classification of Inferred Resource. Should though give us a good steer as to where to drill next to get JORC compliance.

I would of course love to be wrong except that will bring the rampers back

Actually where are the 2p , multibagger, boom & "thar she blows" merchants this morning?

I couldn't have put it better.

Until there is quantification, ideally to JORC standards, we won't get the serious money needed to drive a substantial and sustainable increase in the market Cap.
No disrespect to those choosing to buy in today but, relatively speaking, its quite small amounts of money from a modest number of people. Currently buys are circa 2% of the shares in issue and sells maybe half that. Not very significant in the bigger picture.

Of course this is a welcome positive indicator. However until there is much better quantification then I don't expect a serious level of market interest. It will take quite a program of drilling and assay work to do that. My best guess is perhaps 2 years investigative work.

I do begin to wonder though if the ECR strategy may be to prove one of the prospects they have up to JORC standards and then look to sell it on to provide cash for further exploration and shareholder profits. ie to remain an exploration company rather that have to manage the transition to becoming an operating miner with all the planning, licensing, operational complexity and capital costs that entails.

The really "controversial" figures at ECR were Michael Silver and his sidekick Patrick Harford. Silvers "leger de main" cost ECR a considerable amount of money and was seen as so "questionable" that he was voted down as chairman at an AGM. Harford was subsequently pushed out and Clayson took over when the company was very short of assets. He made some very dubious investments, notably the one in the Philippines as he thought himself well connected as his wife is from there. Unwise but not dubious in other ways. The rest as they say is history.

A very different business now.

Thanks for making the call. Whilst everyone would like instant results that's just not the way it works. At any stage, but especially early stages, its essential to get as much accurate info as possible. It really helps target subsequent exploration much more accurately and in the long run saves time and money. If that means waiting a while then fine by me.

Plus I personally find it encouraging that they seem to be working through all of the bags rather than just those giving a signal to the metal detector. It suggests to me that they may well have found quite a bit of fairly fine gold as well as a nugget or two in the early bags which did give a signal and indicated to them that they needed a more comprehensive program to be sure where there is and isn't gold. ie there could be quite a bit of gold that isn't nuggets. Just my speculation of course but why else go through all of them?

Sorry but I'm mostly out of range in the wilds at the moment. No real idea of when the results will come. How busy is the lab they are using ? Too many unknowns to be worth a guessing game.

Reflecting on what I wrote yesterday it occurred to me I had not properly considered the "nuggety" element. In an earlier RNS there was the comment that the industry standard sample size for nuggety deposits is 5000kg.

I have no doubt there will be further drilling to identify the primary location and shape of the ore body plus further analytical detail they will provide. The other use for these will be to target the optimal locations for taking 5000kgs samples. Just to pick a number a hundred such samples will require quite a bit of secure storage space , thus the hangar. It may also be that they will set aside a closely monitored area area for doing the primary crushing and concentration to bring the sample size containing all the gold down to say 5kg.. This would be a good size to send off to an independent metallurgy lab for the final assays.

In committing to all this infrastructure it says to me is that management must be very confident they are literally sitting on a gold mine!

Testing gold samples isn't something I have done- I'm a biochemist not a geologist- but I have worked on other metals in biological specimens. So bear that in mind whilst I try to answer

If looking at a reasonable number of bags ( problem is we really don't know how many they will look at in detail could be 20 or 100 or all of them) I think you could set up a system that took perhaps one person day per bag. That would probably be split across several people doing different elements of the process. eg one crushing and grinding the bag, one running the concentration system, one sieving and particle size analysis, one doing the gravimetry and flame analysis plus one supervising and keeping all the records straight including photographic evidence of each stage on each sample. Yes you may have just one person doing all of it ( except there must be separate independent qualified supervision) but that would be much less efficient.

To do things to JORC standards really isn't simple "kitchen" chemistry . The whole drilling program, sample collection, storage , handling and processing has to be done to what are called GLP standards so that every stage can be independently audited and verified by the regulatory body approving JORC status to the information released. I very much doubt they will rapidly set themselves up to work to these standards at all stages and indeed JORC usually requires sampling and analysis to be done by a totally independent validated laboratory. What I suspect they will be focused on with the aircraft hangar is high security storage of drill samples and cores. As part of JORC they have to be able to show that from the moment the drill sample comes out of the ground that there is firstly no doubt about which hole and which depth it was from and secondly that there was no way it could have been contaminated or tampered with (its happened many a time!) before the analysts take samples from it under independent supervision. When you have a large drilling program, which I think this will be in the future, handling hundreds of tons of drill samples to unimpeachable standards isn't a trivial undertaking.

I hope this hasn't bored you all but I wanted to ensure people don't think this is a couple of months work. They are clearly preparing for a much bigger program than that.

The management seem to have made a good appointment very quickly. Not just technical skills but a network of connections at the right level. That they could get someone this good suggests to me he was given a sight of information that made it an offer he couldn't say no to.

I'm naturally very cautious about AIM management statements but the rapid actions to st up a substantial logistics and assay systems to support resource evaluation is very encouraging. Its rare to get quite as many actions in so short a timescale and the excitement from the management is almost tangible.

I must remind myself to be cautious though!

Inevitable I guess but its a shame they didn't flesh out what the referenced "Go to Market strategy" actually means in terms of objectives, actions and milestones. Its just "fig leaf" waffle without them.

And in spite of this website suggesting 2 RNS's there seems to be only one on the London Stock Exchange website

Rapidly advancing planning for obtaining a JORC compliant resource.

It will take a while ut you don't head for that unless there is high confidence of a very valuable ore body.