The SP is heading south again, nearing its 52 week low of 2.25p. Only timely action by the Board and prompt, or should I say very prompt updates will keep the company afloat. If there are problems with refractory ore, investors need to know. If it's a question of needing specific pieces of machinery, again, we need to know. The Board shoot themselves in the foot if ever they think of "them" and "us." We need very good information flow and that all important gold pour. A statement needs to be issued saying, for example, we started with 0.5 tonne of 3.5 g / tonne ore, and after the following processes, and after so many weeks, produced so many kilos of gold. And then the statement needs to go on, "And this compares with perhaps 3 other gold producers in the Table shown below." Then, to conclude, "We are pleased to announce that we can produce 10 kg amounts of gold at each pour, at a cost of US$ 1000 per gram." That has got to be the gist of it.
My bone of contention with respect to the issue of Options to the Board is that the Exercise price is far too low. They need to know that they will have to improve the SP to be rewarded -- not given money for old rope. An Exercise price of 8p would be more realistic. Iclaude, you were right to wave the red flag.
Today's Operational Update Second Quarter 2016†is hard to make proper sense of. This is because work at the mine was halted 10 May 2016 due to a cyanide spill into the ecosystem, which is a very serious calamity to befall a junior producer in its early days. I am concerned at the time it took to inform investors of teething troubles at the mine with regard to optimising some very delicate chemical processes. There is never any excuse for keeping investors in the dark. I was concerned at the cost of producing the yellow metal. Centamin can produce it at about $600-800. Why is Aureus' figure at $1253? Where are the consultants with their boots on the ground finding out what is wrong. David Reading should be bought back if necessary. Now there is talk that refinancing may be necessary. This jars a nerve. I don't get it. You're pouring gold and you need to borrow money. Unfortunately, I conclude that Aureus is still not out of the woods. Should the share price depreciate further, investors might dump this stock in favour of gold producers who make their investors rich. The worse thing that Aureus could do right now is to stifle news. If this happens, investors would be advised to cut-and-run.
EX-Aureus CEO David Reading would by now have issued a preliminary statement on the state of play of Aureus, addressing both economic and social issues at the company. If investors feel that the new administration is engaged in some serious cover up, share prices are likely to plunge, and it is not inconceivable for the stock to become worthless.
Laurence, no I didn't. But there appears to be industrial unrest at the plant which should scare investors. This needs to be sorted out with the greatest of urgency. No doubt you saw what happened to Lonmin in South Africa, where the killing of miners led almost to the collapse of the company. The company was only saved by the the fact that debt was measured in Rand, which was so weak, that huge chunks of debt could be almost written off. It is essential, therefore, that mine grievances are sorted out as amicably, fairly and as quickly as possible. It is a mistake to try to fight the workforce, albeit lean, and is bound to have repercussions on gold poured. The Turkish consortium holding 55% of the shares would be well advised to make a statement and comment when they expect the first gold pour.
The Board at Aureus need to be transparent and timely about the situation at Aureus. There is a duty of care to both Aureus investors and the market as a whole. It never pays to stifle the truth, which will be made known. We expect an immediate and accurate news update.
Dear VOG investors. It really is worthwhile listening to people like Duffer and Saltyjack. They of all people, have their fingers on the pulse.
Extracting gold from ore is by no means an easy feat. Aureus Mining may need a little bit more time. So that investors do not lose faith, I wish to highlight how fortunes can be made and lost and made again from the previous quoted journal on the MacArthur-Forrest process. Turn the clock back to the year 1886, Johannesburg, Transvaal. Harrison made the initial gold discovery (paid £0). He sold to Marsden (£10). Marsden sold 3 months later to Hepple (£50). Hepple sold to the Little Treasure Gold Mining Co. for £1500 plus stock (£150). This was sold to the Northey Gold Mining & Exploration Company (£2000 plus £5000 stock). Had Harrison held his original £10 holding, it would have been worth £7,000 in under 11 months. They say patience is a virtue! At the time, they were using mercury to dissolve the gold to form an amalgam, which they would later distil off. (Don't ask how many miners and their families were poisoned irrepairably by mercury vapour in the process, not to mention the complete destruction of local ecology). When, however, mining was conducted at deeper levels, the gold ore proved to be refractory (unable to extract it) to this process. Gold recovery was in some cases halved. Gold stocks crashed. Sir Percy Fitzpatrick even adumbrated, “Grass will grow in the streets of Johannesburg within a year.†Such was their demise that stocks were being sold in bundles of thousands, yet with no buyers. This is where Aureus Mining is at now. Then, or course, the cyanidation process came into being, and those shares, which nobody wanted, became very valuable indeed......... Does this raise morale? I hope it works out!
Blank cheques given out to Board members including "The Boss" are an irritant with a languishing SP, but this fact alone would not be a reason to abandon ship for myself. My two greatest (investment) fears are the demise/collapse of Wall Street later this year, and the fear of hitting dry wells. A dry well could send VOG back to the Stone Age. Regarding VOG, the SP says it all. Tinkering with technicalities or getting bogged down in percentages is a futile exercise.
I left VOG a few months ago for greener pastures elsewhere, but still keep a tab on VOG from time-to-time. Now that the Q2 2016 results are out, Kevin Foo says that we should be rejoicing. But his jubilation has fallen on deaf ears in the Market, which has greeted the news with a drop in SP. I don't wish to decry the good work that VOG has carried out in the Cameroon, but there are still those 2 wells to spud and 6 months drilling to a depth of 3 km at a cost of US$ 40 million. If one or both wells fail to provide economically viable amounts of hydrocarbons, then investors should run for cover. Press the panic button. Before the drilling phase is completed, investors are more than likely to feel the chill winds of a serious economic meltdown in the US and may be forced sellers for reasons nothing to do with VOG. Finally, Chairman Foo should be able to rationalise Board Remuneration with SP, so his position is robust.