Monarch certainly do have potential and there ambitious
anyone know there hedging situation?
Damm 100 character thing.
Completely unhedged and if you read this you will appreciate what is ahead for MON as it's future lies not only in it's current proven resources but in it's discoveries from the under-explored tenaments MON has been purchasing.
http://www.minesite.com/nc/aus/mine...gold-tending-to-run-before-it-can-walk/1.html
November 28, 2007 - Monarch Gold Tending To Run Before It Can Walk
By Our Man In Oz
Most companies, like people, learn to walk before they run. Not ASX listed Monarch Gold. Despite a poor production record over the past year, and a share price which is stuck in the cellar, Monarch is showing absolutely no restraint in its desire to play a leading role in the revival of the Australian gold industry. Over the past year it has acquired, consolidated, invested, expanded, and recruited at a pace so hectic that it is hard to keep track of exactly what it owns or find an answer to the question of why such a hurry. Before looking at the rapidly-expanding asset base inside Monarch the answer to the “why grow so fast” question lies in a simple belief held by the company’s chairman, Michael Kiernan, that the gold price is heading for US1000 an ounce and there is a race underway for gold assets, even if not everyone knows the race has started.
Other observers of the gold market might share Kiernan’s belief, but few are running as hard. Earlier this month, Monarch took perhaps its biggest step so far when it agreed to pay A$65 million for the historic Hill 50 goldmine in Western Australia. The key word in that sentence is historic, because Hill 50 is one of only two goldmines in Australia to operate continuously over the past 50 years. The other is the Kalgoorlie Superpit (and its predecessors). Close followers of the Australian gold sector will already be detecting the key message in this dispatch from Oz. That Monarch is buying old, pre-loved mines, with the hope of turning them into something special.
If the gold price continues to rise, there is no doubt Monarch is holding a winning hand. But, the real value in the plan lies not in the “historic” workings at Hill 50, Davyhurst, Mt Ida, Bellevue, Riverina, or any other mines which have fallen under the company’s control. The value lies in the vast - and that is really, really, vast - package of tenements and mining leases which come with the deals. According to Monarch’s own reckoning it is already the biggest land-holder in the Eastern Goldfields region of Western Australia, an area which contains the fabulous wealth of Kalgoorlie, Coolgardie, Leonora and assorted other locations.
After announcing the acquisition of Hill 50 on November 8, Kiernan said a first step would be to shut the mine, and keep it on care and maintenance for up to two years. In that time, exploration would be stepped up across the 1,100 square kilometres of tenement which came with the deal. There is little doubt that more gold will be found. At the point of the Hill 50 sale the previous owner, South Africa’s troubled Harmony Gold, said it was sitting on a resource inventory of 2.7 million ounces, plus a 2.7 million tonne-a-year processing plant. For Monarch to put a padlock on the gate of that operation is what an Australian might describe as “gutsy”, because it is saying in very clear terms: better times are expected and we can afford to sit on the resource, find more, and switch the plant back on when it suits us.
Kiernan said the Hill 50 acquisition would take Monarch’s JORC-compliant resource base to more than five million ounces of gold. “This is a significant step towards achieving our goal of becoming a 500,000 ounce per annum gold producer by 2009, and this project will provide a substantial contribution to profit for Monarch shareholders,” he said. “Monarch now has two world-class goldmining projects, Davyhurst/Mt Ida and Hill 50. And with the gold price surpassing US$800 per ounce, we are well positioned to capitalise on the potential of these historic projects.” He’s right. But, there’s more water to flow under Monarch’s bridge before it can claim success with its “gutsy” expansion plans. Getting its operations to work efficiently would be a good starting point.
“Yeh, we had a shocking bloody quarter,” Kiernan said of the three months to the end of September when Minesite popped into his West Perth office for a natter two weeks ago, just before the Hill 50 purchase was announced. “We went into the wrong pit, it was low grade, and we’ve moved out of that. The second quarter will be fine. But there’s no doubt we’re on the right track.” That bad quarter is reflected in Monarch’s share price which briefly traded up to A36 cents last April, but which has been stuck in the sub-A30 cent range for the past month. Investors can see Kiernan’s plan, and they can certainly hear it when he delivers one of his booming addresses, but they’re not yet putting their money where his mouth is.
That should change. If nothing else, Kiernan is an absolute enthusiast for mining, in all of its forms. Whether he’s trying to do too much, with other interests in iron ore (Territory Resources), mineral sands (Matilda and Olympia), copper (India Resources), vanadium (Windimurra), and mining engineering services (Mineral Resources) is an arguable point. Gold, however, is something that really tickles his imagination, and when the topic in a one-on-one conversation turns to gold his eyes light up, he gets louder , if that’s possible, and he enthuses with true zeal.
“I’ve looked around and can see lots of little people who can’t make it on their own,” he said. “If you put them together, and they have access to capital, good management and exploration skills, then you have a real recipe for success.” Minesite interrupts with this question: Aren’t you doing the same as Apex Minerals which is also consolidating gold assets in Australia. “Right, but they got the idea off me,” Kiernan said. “And they’re going for refractory ore, I’m going for the other stuff. Look at what’s been done so far. We’ve put Siberia Mining together, Davyhurst, Riveria, and Mt Ida. They’re four different areas, but if you put them under one processing plant you have a project. There’s no doubt gold is a winner.”
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