re: Ann: High-Grade Gold at Frenchman's R... without the...

re: Ann: High-Grade Gold at Frenchman's R... without the tailings they would have raised, they were out of gas. The crosscourse fault blew there plans apart.

the tailings pays for the next quarter and leaves them net working capital $2.5million 30 June

so it some down to the success or otherwise of the underground and openpit and the price of gold

the odds are 50/50

the strip ratio on the open pit is 8 at 1400 gold you need 2gpt to breakeven , on the underground its 4gpt if using airleg and mining width is averaging around .75m. Its a vertical dip, easier to mine selectively as long as rock conditions are good. That is actually the biggest risk, not grade.

so yes it may be necessary to raise capital if things dont work out

then it comes to how they raise capital. If they do it via rights, which is the most likely option based on my past experience being a shareholder in Gandel controlled companies, then big deal, I dont get diluted and can pick up extra from holders who wont take them up

then again, only 5000 tonnes of bonanza from undeground is required to flush them full of cash, send the price rallying and THEN they can tap the market

and one thing is for sure, they are working one of the richest gold mining districts in Australia historically.

thats the nature of the game, the best game in town!