Ann: Integration Update , page-15

"If production is below expectations think what that means for average cost. To me it means that for the December quarter the IGR operations will have been operating at or near a loss."


Who's to say with the cost accounting Loki, expensed vs. capitalised? As I said before, I suspect SLR are largely processing Integra's lower grade stock pile to preserve cash. The mining costs for this have already been spent by IGR.

The main issue for me now is their cash/bullion position to see them through the next quarter or two as production ramps up at all three of Mount Monger, Randalls and Murchison. In the Dec quarter they produced at half the annual rate that they will be in FY14 (400kpa).

My main concern, as it is with all with my gold holdings, is whether SLR is generating enough cash flow to fund their growth? I suspect they are, with the prudent back-up of their financing facility due to risks of expanding all three simultaneously.

But again, much of the development work at Randalls and Mt Monger has already been spent. The higher grade ore at Maxwells and Daisy Milano/Haoma/Haoma West is ready or near-ready for production.