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Towards a new strategy for the junior gold explorers « Peter J. Cooper’s Weblog
by arabianmoney | May 13, 2008 at 05:54 am | 222 views | 4 comments
If the management of a junior gold explorer wants to convince investors that it is worth more than its current beaten down share price – and junior stocks as a percentage of the gold price are at a historic low point which ought to be attracting investors – then they need to spend more money on getting their assets appraised than rushing off drilling more holes.
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May 13, 2008 at 05:54 am by arabianmoney, 222 views, 4 comments
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Comments (4)
at 16:34 on May 13th, 2008
I respectfully disagree. How can a junior appraise its assets? With accountants and MBA's? Not a chance. Paying pencil pushers will get you nowhere. Its all about what's in the ground; and geologists are the only profession that can tell you that. And drilling is how it is done.
Only once the ore body has been explored and delineated can a junion even mention the possible value of its property. Perhaps you have never heard of a 43-101 report but it is a document required before any mining company can say anything about the value of their asset. And before a 43-101 report can be produced and approved drill results are required. So fire the guys in suits and hire more grunts on the ground. That is the only way for a good junior to move ahead in this market
at 00:05 on May 14th, 2008
If a company can no longer raise cash then it will only survive by reducing costs, and relying on its assets to deliver long-term salvation. Spending is suicidal like the dot-coms. So I suppose that means juniors without 43-101 reports by now are dead in the water. It was an investment boom, now comes the shake-out and consolidation. But it will be a shame for investors if these assets are now sold way below market value - greater transparency from management is the way forward.
at 02:21 on May 14th, 2008
A study published yesterday by top accountants Ernst and Young reported that almost half of the large mining companies interviewed need to make acquisitions to meet aggressive growth targets and a thumping 90 per cent said they will make an acquisition in the next two years. See my current post!
at 19:56 on May 14th, 2008
Those juniors that have 43-101 quality properties are having no problems raising cash for exploration. Moose pasture (like pets.com) won't get funded in this market without giving up a great deal. I have a public company and we are looking for an acquisition that can be self-financed. Got any suggestions for me? What sectors do you like?