Money through a long-cycle business.
WHAT THE PATTERN IS
Substantial expenditure before any revenue, over an extended period.
WHAT THE STAGES COST
Title acquisition and fees Exploration Feasibility assessment Development and equipment Working capital before sales stabilise
WHY FUNDING IS DIFFICULT
Exploration expenditure has uncertain outcome and lenders will not fund it.
WHAT FUNDS EXPLORATION TYPICALLY
Equity, from those willing to accept the risk.
WHAT FUNDS DEVELOPMENT
Debt and equity, once a deposit is demonstrated.
WHAT TO ESTABLISH BEFORE RAISING ANY MONEY
What the money is for, and what it will establish.
WHY
Investors fund defined stages with defined outcomes.
WHAT TO AVOID
Raising money on the strength of selected samples.
WHY
It misleads investors and it is how the sector's reputation was damaged.
WHAT TO PRESENT
Systematic results, with their limitations stated.
WHAT TO ESTABLISH ABOUT INVESTORS
What they receive, and what happens at each stage.
WHAT TO DOCUMENT
The agreement, precisely, before money moves.
WHAT WORKING CAPITAL COVERS
Fuel, wages, maintenance and royalties, continuously.
WHY IT IS UNDERESTIMATED
Production is interrupted and sales are lumpy.
WHAT TO TRACK
Cost per tonne Production against plan Cash position, weekly
WHY WEEKLY
Fuel and wages do not wait.
WHAT TO SET ASIDE
Rehabilitation and equipment replacement.
WHAT TO REVIEW
Whether the operation is actually profitable at current prices.
