Ann: Becoming a substantial holder, page-2

Watched an interesting presentation from EVN today (Denver Gold Forum). Apart from talking about EVN the CFO also talked about the Australian gold sector.

Specifically he stated that Australia was the second largest gold producing nation (270t p.a.) but only represented 8% of the GDX portfolio.

With recent consolidation of mid-tier miners (as the majors withdraw from Australia) a few companies stand to benefit from a change in perception of the Australian gold sector from:

- Politically uncertain (super profit tax + carbon tax)
- High cost as other resource sectors boomed put cost pressures on gold miners
- High Australian dollar

to:

- Politically stable
- Lower cost profile (note: NST presentation stating that they have just secured US$16m in savings from 1/1/16 due to contract renegotiations)
- Falling AUD

Today's announcement from Van Eck plays out perfectly to this meme. I would suggest that RRL, EVN and NST will be amongst the beneficiaries as investors slowly start to realise the FCF being generated by the well run multi-mine operators.

Cheers
John