Things are moving very quickly in Brasil.. Please remind again, after all we are going into production with the Gold around mid year alongside with the Iron Ore and Manganese at Wilcherry Hill.
Orinico OGX know exactly where the high grade Gold is, with channel sampling and they are building another decline parallel to the existing old tunnel built by the Portugese a few hundreds years ago. This gold will be removed quickly and efficiently transported to nearby Cleveland Mining for processing and milling. Great strategy-Alliance.
OGX have applied for a 50000 tonne pilot trial plant next year. If the head grade is 20g/t
50000 x 20g/t = 1000000 grams 1000000 grams / 30 grams to an ounce = 33333 ounces 33333 produced x POG US$1250 an ounce= $41 million 33333 cash cost = $ 600 an ounce= $20 million Revenue $41- Cash Cost $20 = US21 million Profit to OGX. US21 million /.90 = AUD 23 million Further upside if the dollar drops back to .85-80c
Trafford own 17% of the company's share register, so if OGX SP hits 50c- $1. That is a large amount of Cash sitting on TRF Balance Sheet/Books which can be either divested and put to other investments or returned to shareholders in dividends (bonus Payment) If OGX SP goes up there will be a large rerating of TRF Balance and SP. The story gets sexier for fund managers, to invest in TRF, just with the TRF Cash Backing alone
Gold mining is a very big business especially if the head grades come up Trumps, lowering costs of production even further. I like OGX have an existing tunnel, this is a bonus to bring this project into production, quickly and efficiently. Andean Resources went from 6c taken over by GoldCorp for $7.80 a few years ago for only 500,000 ounces proven up and Reserves of 2 million ounces.
We are in a advantageous position as there is a very small number of shares listed on our register of 120 million currently. I.F has preserved Share Capital after some very difficult times in the last few years. A substantial shareholder tightened up the register the other day, taking 5-6% interest. Im sure they will be a long Term holder.
The SP can move very quickly as we saw last September October when it shot past the 20c barrier. There has $1 billion of acquisitions and mergers of Chinese taking over small mining cap mining interests in the last few months, eg Perilya Zinc and Carabella Resources. The Chinese already have 58% control of Rey Resources next to Buru Energy. Extroadinary times as the Dollar drops favourably back towards 85c..
2014 Time to go up! Arlberg1
TRF Price at posting:
10.0¢ Sentiment: LT Buy Disclosure: Held
