KWR - Kingwest Resources

[finicky]

Yep, slow going, nothing to see here for a while.

Three prongs:

DD at Lake Goongarrie, might see first results in a few weeks. He warns that it's a big mineralised footprint under which they are trying to locate the primary mineralisation. That sounds a bit lower key than prior comments. Managing expectations?
Still trying to swing a deal over the Menzies Gold Project assets. For sale or jv.
Low priority investigations into Nickel prospects in the 'Highway Mafic' unit on the east side of Lake Goongarrie which hosts known commercial Ni deposits.

Time ticking, KWR shares could get cheaper.

 

[finicky]

Might close @ 0.155, 19% up today.
I am starting to feel hubris return.
You might have dipped out on ample opportunity to bag this spec @0.13 which is 1 cent lower than my painstakingly accumulated price.

Daily

 

[finicky]

Unreal - back to my average buy-in price and actually dipped to 0.135 intraday. I am perplexed but maybe there is something I am not getting. End of financial year selling? Initial visuals from diamond core on Lake Goongarrie disappointing and leaked? To think this is my May comp pick; the shame.
They have just had encouraging first pass aircore drilling results for Nickel on the east side of the lake and diamond drilling has resumed after mechanical delays on the potential company maker gold prospect (Lake Googarrie) WTF?

 

[finicky]

My pick for the June comp.

I went back over some posts I've made here and this is turning into an unintentional comedy thread.
A comment from an experienced speculator elsewhere switched a light bulb on for me and I now think it's likely that a capital raising is approaching. Best hope is that positive results come in from the DD at Lake Goongarrie beforehand. But with the plummet in price in early May - from 0.20 to 0.125 in just over a week someone informed might be betting that drilling results wont precede the cap raise.

Our board is much too close to its main capital raiser, Peloton capital. Small shareholders remember the strange torturous grind down of the share price in the first Half of 2021 where the company was forced to raise capital in May 2021 through Peloton at a very low $0.08 with the insult of a free half attached option thrown in. They only raised $3m and I think that was before Peloton's fee.

So now its a year on and how much cash is left? I notice that in the recent Preso (May 23 2022) where at the front they do the usual 'Company Overview' they don't even mention their cash position - see screenshot thumb. Like an investor doesn't want to know the cash position of a junior explorer from a Preso - its one of the first things you want to know. Then there's the mere fact if doing a preso anyway - it's so often portends a cap raise.

 

[greggles]

So now its a year on and how much cash is left?

According to the most recent financials, they had $3,222,000 in cash and cash equivalents at the end of the March quarter. They burnt $1,275,000 in cash in the same quarter. So presuming that they have burnt a similar amount of cash this quarter they are likely to have ~$2,000,000 at the end of June, possibly a little less than that.

So yeah, they will have to raise capital soon. Some good drilling results would be nice before then. Looks like assay results are due in June from diamond drilling at the Sir Laurence Gold Discovery. Hopefully the results are good.

 

[finicky]

Yes, you're right @greggles - I should have done more refreshment of my reading before posting that. I forgot the subsequent placement 14/10/21 where they raised another $4m before costs through Peloton and Euroz Hartleys. So as you point out, they still have a few bob. They did that second placement after the Goongarrie discovery.

 

[greggles]

Yes, you're right @greggles - I should have done more refreshment of my reading before posting that. I forgot the subsequent placement 14/10/21 where they raised another $4m before costs through Peloton and Euroz Hartleys. So as you point out, they still have a few bob. They did that second placement after the Goongarrie discovery.

My guess is that they will delay the capital raise until August or September and hope that they get some good drilling results in before then. Better to dilute at a higher share price if they can. Assay results announced in the next couple of months will be critical to getting that share price higher.

 

[finicky]

Better to dilute at a higher share price if they can

This is what I no longer trust this board for - even less after Jon Price's exit (he's M.D of HRZ - KWR's biggest shareholder). I suspect the board leans towards giving Peloton a good deal in cap raising. Maybe getting cynical.

 

[Sean K]

Just in case you missed this @finicky

 

[finicky]

Thanks @Sean K, as you correctly surmise, I sniff out anything on the forums/twitter regarding this, my vehicle to untold riches (that I'll never spend anyway, just reinvest). Mr Turner, or 'Ed' as presumptious posters call him, continues to sound as if they are onto a Kanowna Belle style deposit, although I guess that could just be his job, they're all half salesmen. He's better than most imo. He even mentions rattling the tin again but comments that it won't happen till after July. That'll be after they've got some diamond drill results from this campaign on Lake Goongarrie I assume. I have stopped anticipating that they might get some money flowing in from a sale or joint venture of current resources at the Menzies Gold Project, although I must admit he makes negotiations for this sound a more drawn out and nuanced process than I had thought. He hasn't mentioned the interest FMR ltd once expressed in a mining/toll milling deal for one of the u/g deposits (Yunndaga) for ages. FMR ltd being the owner of the Greenfield mill at Coolgardie.

 

[finicky]

Sitting order that I forgot about hit @ 0.105
That was a stink bid once.
Price has dropped as low as 0.10 intraday. I was staring at that, unaware I had a bid in @ 0.105.
At 0.10 it was a 23% drop in a few hours.
With a cap raising not far on the horizon I would not have been game to add to my burgeoning collection of KWR shares today. M.D alluded in an interview to rattling the tin again after July (when hopefully we'll have some DD results in from Lake Goongarrie). I am suspicious that large holders who would expect to be included in a placement (namely Peloton clients and maybe Hartleys) could be selling the stock down - not just today, but that's just the way I'm thinking, could be nothing in it.

 

[greggles]

With a cap raising not far on the horizon I would not have been game to add to my burgeoning collection of KWR shares today. M.D alluded in an interview to rattling the tin again after July (when hopefully we'll have some DD results in from Lake Goongarrie). I am suspicious that large holders who would expect to be included in a placement (namely Peloton clients and maybe Hartleys) could be selling the stock down - not just today, but that's just the way I'm thinking, could be nothing in it.

Bad timing on that tin rattling exercise given what has happened to the market this month. They need some spectacular drilling results and they need them soon otherwise they will be raising capital at current prices and that would be a shame given where the share price was back in April.

 

[finicky]

@greggles Agree, something dramatic from the lake it crucial now to avoid a big dilution. With tax loss selling still a possibility, buying now is an unacceptable gamble.

 

[finicky]

A heavy blow - price down 30%, bargain, lol - fill your trolley.

 

[finicky]

Nothing stands between us holders and a heavily dilutive capital raise now except the feeble chance of a jv or sale of some of the Menzies Gold Project assets

 

[Sean K]

A heavy blow - price down 30%, bargain, lol - fill your trolley.

View attachment 142963

I read through this ann a couple of times this morning trying to work out how Ed was upbeat about the holes. I'm no geo and am sure the lithology may point towards something, but these were pretty much dirt within dirt.

 

[finicky]

I've got a bid in for more @ 0.065
I 'have' to be consistent and since I am a firm believer in an impending gold bull market resumption, then what is the Menzies Gold Project (MGP) alone worth?
MGP 500kozs Gold MRE mostly modelled in pits and all pits < 200m deep
KWR at 0.065 per share (slightly higher last I looked) with 250m shares issued = $17m market cap
That's valuing Menzies gold @ $34/oz
Water and power supplied to tenement, adjacent to sealed hwy, close to second party plants, all resources on mining leases.

Plus Goongarrie Gold Project (GGP) is far from dead, they've got results with no gold from two diamond holes poked into bedrock below a surface gold mineralized alluvial area 2kms x 1km.

Still worth the punt to me, although the biggest cloud is the soon to come capital raise. Say 100m new shares placed @ 0.05 to raise $5m giving a new tally of 350m shares issued?

 

[finicky]

Just checked and I'm down 58% on my KWR holding. That's after being well in profit for a while. Not posting a chart, lol. Desperate for a win in at least one of my specs. Hope the news on Monday will be tangible data that they are closing in on bedrock primary gold mineralisation at Lake Goongarrie. Very disappointing if it is just a pump announcement before the looming capital raise.

 

[Sean K]

Just checked and I'm down 58% on my KWR holding. That's after being well in profit for a while. Not posting a chart, lol. Desperate for a win in at least one of my specs. Hope the news on Monday will be tangible data that they are closing in on bedrock primary gold mineralisation at Lake Goongarrie. Very disappointing if it is just a pump announcement before the looming capital raise.

View attachment 143895

Maybe Sir Laurence picked up something more than 0.35g/t?

 

[finicky]

@Sean K got to be better than that, assuming it is Lake Goongarrie (the Gold prospect, not the Nickel on the west side of the lake). Also that it not at the Menzies field further north. To give him the benefit of the doubt I think Ed Turner was dialling down investor expectations for the first three diamond holes below a 2 sq kms area of secondary alluvial mineralisation.