Member Info for Boffin

Unless there is an RNS closely preceding the interview then I doubt much fundamentally new can be revealed.
However he could provide some infill to already declared activity and such questions we have about where is the second drill rig? Why is it taking so long to get assay results back ( and that's when we only have one rig) and what can be done about it? Strategic thinking re property sales and land retentions? Some detail of sampling and drill program for the next 12 months etc etc.

If it it then the ore is averaging around 10,000 g of gold per ton! That's rock that is 1% pure gold that no-one ever noticed before !

Do I think that's likely?

Take off agents fees, taxes and solicitors we will be lucky to break even on these property deals.

I was VP of R&D in a major Pharma company before I retired. Requirements may be different in mining assay labs but it certainly wasn't simple or particularly quick to train and expand personnel and space to operate to what is called "Good Laboratory Practice" in our labs. It sounds very bland , I mean why wouldn't you operated to Good Practice as a matter of course? Well the devil is in the detail, detail running to thousands of pages, as required initially by the US FDA and then most regulatory authorities around the world. It requires everything from staff training records on every procedure they run, every detail about equipment usage eg equipment servicing, calibration, who did it when, which tests using it were run, by whom at what time and date etc and I could go on for ever. Absolutely everything has to be recorded as it happens, signed off as checked every day by the most senior scientist in the lab and records of everything done be simply auditable by the regulatory authorities. Bringing new people into that environment and training them in everything they need to know about compliance with the whole system beyond the actual hands on procedures they do day to day is not trivial.

But thats Phama, mining may be different but I suspect detailed procedures such as core sample traceability, systems security and record keeping will be JORC requirements.

Well we should get news fairly soon of drilling commencing at Blue Moon as AH disclosed in his presentation in July. It's worth reminding ourselves of just how good the pilot RC drilling results were. And its highly improbable that we hit the best of it first time around!

"Nine of the 12 RC holes completed for 1,718m had significant gold intersections.

Highlighted intersections included 2m at 17.87g/t gold within a zone of 15m at 3.81g/t gold from 51m; 3m at 3.88g/t within a zone of 11m at 2.42g/t from 169m; 1m at 2.15g/t at the top of a zone of 16m at 0.28g/t from 85m; 2m at 1.4g/t within a zone of 14m at 0.54g/t from 132m; 1m at 1.94g/t from 138m and 5m at 0.46g/t from 152m; and 5m at 1.09g/t from 97m.

My major concern is the unbelievably slow service that is being provided by the assay laboratories. We seem to be generating drilling cores far faster than they can handle them.

Heaven knows how long it will take to get results if we do finally get a second rig operating.

Thanks for that Chesy and yes I'm sure you are correct.

The tax loss is reported as a footnote to the tax statement on p32 of the most recent annual report. It seems a bit "small" at £8 million. However I think this is what it is worth to the bottom line ie the corporation tax due ( at circa 20%) on profits of £40 million ie Aus$ 70 million at current exchange rates. However its only useable when ECR make an equivalent profit. Its a rather complicated area in Aus tax law but essentially the loss has to be used by ECR and cannot be "sold on" and may indeed disappear in a carelessly structured takeover or merger. If you want to see a bit more detail you could do worse than start at the "companies" heading here

https://www.ato.gov.au/General/Losses/How-to-claim-a-tax-loss/#:~:text=Companies%20can%20carry%20forward%20a,same%20business%20test%2C%20or

Essentially we have first to make a profit of circa $70 million. Any guesses as to the share price when we are in that position?

I hope you are correct diplomat. It would also be good to be advised as to what has happened to the second drill rig whose purchase was announced nearly a year ago.

Its 35 tonnes a day processing capacity not 13.5.

And as if we needed further proof "Scottish Education" is now on a par as an oxymoron with " Police Intelligence"

Of course I may be wrong but there are several other indications that this may not have happened as per the RNS.

A deeper commercial arrangement was predicted and no mention of this has appeared in any AFC annual report

Shares were due to be issued the Hiiroc and I can find nothing in the record of shares in issue which indicates this happened nor is there any mention of this in an AFC annual report which if it happened should certainly be in the accounts

Hiiroc did a fund raise at the end of last year and made mention of various supporters but with no mention of AFC

Now I know that absence of evidence isn't the best of proofs but as I said, make up your own minds what this all may mean.

I wrote to Hiirock towards the end of April to see if I could get some confirmation about this AFC announcement.
Their business development manager was careful not to confirm who they had "arrangements" with. His reply to one of my mails, copied below, did rather concern me as he denied any knowledge of of the announcement by AFC

"Thanks for showing interest in HiiROC and taking the time to contact us.

I hadn’t seen that press release, so thanks very much for bringing it to my attention.

We are currently in the process of verifying and certifying our tech of our single torch model and we hope this will be complete later in the year. Then we have a number of (mostly) UK-based pilots to test the tech in situ.

And then we will be turning our attention to manufacturing single torch models at scale, whilst also perfecting the four torch model and going through a similar process. It is anticipated that this model will produce the purity of hydrogen required for fuel cells for vehicle charging."

Now whether that means there is no deal with AFC or whether he just was unaware of that press release, which is what is actually written, I don't know. You will have to make up your own minds.

And I did publish this response on here shortly after receiving it.

We only have the one rig but are still waiting for the delivery of the second as announced

https://www.lse.co.uk/rns/ECR/purchase-of-second-drill-rig-for-central-victorian-goldfields-australia-fw2pg2xmhxazahe.html

ECR did contract in some additional drilling but found this expensive and not readily flexible to changes n the drilling program in the light of ongoing results as the RNS from Nov26 last year makes clear.

ECR often publish news via the London Business wire which if you read its "blurb" claims to provide a service which is "Trusted and secure source for meeting financial disclosure requirements".

Perhaps LSE don't have a deal with them to copy content.
The home page is https://www.businesswire.com/portal/site/home/

Certainly comes over as a class act , clear about the priorities and a guy I'd be delighted to have a beer with.

Piltick

I don't know what the cost per Kw hour from the Power Tower is. However surely comparing the cost to grid electricity is substantially irrelevant. Its the cost vs diesel generators that is the relevant comparison for temporary power.
Now one lite of diesel fuel has an energy content of approximately 38 MJ – which approximates to 10 kWh (using a ballpark figure) but the efficiency of conversion into electricity is only about 30%. Thus given the removal of red diesel tax benefits this would indicate that the cost of diesel generated electricity is around 60p per Kw hour. This puts diesel generated electricity well above grid prices even given the recent hiatus in all energy costs.
Exactly how that compares to Power Tower costs I don't know but the reduction in local air and noise pollution on site are also added benefits as well as the broader green agenda profile for the user. And costs may well reduce as alternative fuels eg methanol become more widely used. Technical grade methanol is around 65p per lite in IBC's and even cheaper in bulk, roughly one third the cost of diesel but you have to factor in methanol has a lower energy content per liter than diesel . My best guess is that overall the Power Tower will be reasonably competitive to diesel generation.

With respect to the RNS I think he's damned if he issued one and damned if he didn't.
At just a few weeks into his tenure it seems to me that he's unlikely to have forged the in depth knowledge and relationships, especially with Peel, that will have enabled him to make specific commitments as to timing, costs and revenue that of course we would all like to have. He would risk being seen fairly soon as someone overcommitting and under delivering.

However the SP forced him to say something and a clear commitment to present a comprehensive strategic review within3 months is probably the best he dared do. Of course we would all like something sooner but I would like him to get it right first time but if it takes 3 months then that doesn't seem unreasonable to me.

And to me more of the blame for the current situation lays with the slippery windbag TY who added ziltch value and a lot of cost.

It's rather hard work but I would suggest going back to the technical report on Danglay prepared in 2015. It contains some positive things eg the gold found so far is at quite shallow depths and there may be more at greater depths. However its also clear that a great deal more work is needed>perhaps thats why ECR paid so little for the additional shareholding. Maybe the seller just didn't have the funds to support their contribution to the scale of further exploration required. And also never underestimate the mercurial nature of politics in places like the Philippines. We've been delayed by seven years since this report was issued and we still can't be sure of how much easier its going to get.

https://www.ecrminerals.com/ni-43-101/download-file?path=181215%2BNI43-101%2Btechnical%2Breport%2Bas%2Bfiled.pdf

Cashking- Unfortunately a straightforward takeover would fail the Aus government rules on ownership and the tax loss would be lost. Its a rather technical legal area and I'm told by others that there can be ways round it but you can be sure that the tax office is looking out for artificial constructions . You could start by looking here

https://www.ato.gov.au/General/Losses/How-to-claim-a-tax-loss/

https://www.ato.gov.au/law/view/document?docid=PAC/19970038/165-150

The tax benefit is quite clear and is in a note under the heading "taxation" on page 32 of the annual report. It reads

"The Company has unused tax losses of approximately £8,100,000 (2020 £6,950,000) to carry forward and set against future profits; and the Company has capital losses of £197,000 to carry forward and set against future capital gains of the Company. The related deferred tax asset has not been recognised in respect of these losses as there is no certainty in regard to the level and timing of future profits.

This circa £8.1 million is the net benefit of not having to pay corporation tax at 19% on profits of £42.1 Million. ( circa Aus$ 74 million). It has been slowly increasing year on year because ECR is annually reporting a loss. Also we need to be careful of exchange rates as this can ( and indeed has in the past) substantially changed the value of the tax benefit measured in £'s. Until a few years ago it was always reported in Aus$. Personally I wish it still was so reported or at least dual reported to make any yoy risks and fluctuations clear.

The first thing we have to do though is the minor matter of making the profit and for that we need the geologists!

Then the tax benefit situation will almost take care of itself.

I just emailed HiiROC to try and get some kind of confirmation of status.

I received a very prompt reply which didn't quite answer my specific questions but at least didn't say there is no project with AFC.

They did say though that they were still in the stage of proving and scaling up their own technology and that they anticipated that the scale up would be needed to give hydrogen of the required quality for a fuel cell. They added that there were a number of pilot agreements, mostly with UK companies ( but of course no names) that are anticipated once they have a certified process for their equipment. Certification was scheduled by year end for their "one torch" model but at least another year before the "four torch" model would be ready to test.

So maybe including AFC but on P27 of the 2021 annual report there is a diagram highlighting potential fuel sources and lists ammonia, methanol and compressed hydrogen but makes no mention of methane reforming to generate hydrogen.

Anyway it doesn't appear we should expect much progress in this area for at least a couple of years.