Agree, cash flow has improved dramatically since Dec, so would allow. Financial strategy should now be in place to pay off debts by a certain date, along with at the same time building up some cash reserves (helps SP and company and employee/contractor longer term financial security), and AT THE SAME TIME commencing an intensive drilling program (3 increasing to 4 drill rigs) to extend life of mine. And progressively define ore bodies and plan for mining new areas.
SH should be advised of these plans, timelines, dates and dollar amounts, in this quarterly. Current expectations plus future potential.
Additional drilling results will then allow the company to develop plans for the (first!) underground mine plus initiating applications process for approvals for new open cut (adjoining areas) and for commencing underground mining.
I would have hoped that adequate resource definition should have occurred to advise the market of increases to life of mine quite soon, and certainly by end of next Q ,with advance drilling result releases between now and then. I would also hope for a timetable to be released in this Q report, that disclosed their plans (depending upon drilling results) to commence underground mining in Q1 2019, with minor upgrades and work on the plant as required between now and then.
All depending on drilling results. And hopefully these will now be regularly released to the market.
I base this plan of resource development on my experience as a SH of Pantoro (PNR) over the past 2-3 year. PNR have grown both SH value; and their resource and shortly their reserves; and their mill output very significantly over the past 1-2 years. Through growing their knowledge of their resource, and leases, by using 4 drill rigs, and by slow and steady and relatively cheap, and what looks like very cost effective, increases to their mill capacity and now their mill efficiency. Whilst at the same time by paying off their debt. There seem to be many similarities between PNR resources and leases, and HGO. Both near to mill and more distant prospects.
And PNR have achieved this by being very conservative with their financial management and approach, whilst at the same time being very aggressive with growing the resource and the company as information is acquired, in a logical and very conservative manner. If that makes sense. Trying not to pump PNR, but as posted previously, I think that their Quarterly reports are a good model for SH information, and that hopefully HGO will be also aggressively exploring the potential of their mining targets and leases with a view to trying to significantly increase annual production beyond current 2019 expectations. The Chairman of Pantoro has worked with Gary Weiss and Maurice Loomes (Ariadne) for many many years. All are very sound managers and Board Directors in my opinion.
I have concerns (hopefully unfounded) that HGO management will only focus on the next year or so, on ensuring the known and anticipated large cash inflow from the known resource and pit, and will not AT THE SAME TIME, be trying to increase the potential of their leases and resources.
And if there is no decent mineable resource, then so be it. Pay out the company and SH and move on. But, I as a SH I obviously have hopes for this company, as long as the Executive and MD can now rapidly grow the resource and the production at the same time as continuing with the existing mining plans for 2018 and 2019.
Hopefully they would have booked and organised drill rigs and drilling well in advance of when needed !!!
Forward planning !
(20min delay)
