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VAU - Vault Minerals

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Beatle - thanks your posts very informative. i have to say i am also feeling "blue" - this is so frustrating that this has so many false breaks /one days peaks and slips backwards so quickly. I am way over-balanced in RED and want it in 20's so i can rebalance!..i am missing others that are running!

I have been trying to figure out why there is such a gap betwen Sp and fairer value. I suspect the very high quality posts you had repeatedly reminded market on very solid values in the stock and which i concurred with! We even see a clue of this in the depth with so much listed well ahead at 19 and 20 - i think others have been heartened by the analysis and know that they can safely trade from any current value and know that SP will eventually get there. But internet posters really couldn't affect price, ? could they?

Anderbond - i was surprised at the statement in the ann. re Mr Govey deaprture included a declaration of his intent to hold shares. I thought why don't more co.s do they - fairly happy he declared that and happy to take that at face value.

I note on the chart that there is now a (bullish) cup & handle formation from the mid-Nov point to now. Also note that the 30 day moving average has just gone upwards through the 100day M (aso bullish) ...so maybe something more positive will happen.
 
Hi Mgm1a, thanks for your comments in your post and I want you know that your thoughts regarding the bullish technical interpretation is very comforting to me – not that I require a chartists technical tick of approval for my own belief in RED, but because it will provide the tick of approval that many other technical traders require for their own investment decisions. Its because we have like minds, each with a tick of approval, acting together with solidarity (and I am no communist at all, Lol) that will ensure that RED share price finally moves towards where it should be!

But your post also has made me think a bit more deeply about some of the frustrations that many of us longer term holders share and continue to have even now, despite RED finally achieving the considerable milestones, particularly in the last 12 months. In terms of real project activities and milestones there has been a considerable level of accomplishment, that does give me the confidence to believe this time we are heading towards that long-awaited payola.

In contemplating your comments regarding frustrations of RED not already being at a much higher share price, I thought it might be worthwhile for me to expand on RED regarding its history, that might fill in some of the gaps of knowledge that other more recent investors will take on board, and it might also help us all to have more confidence that the many false starts we have observed in recent years are ready to end in success! Its possible this history will help fill in some of the gaps to the jigsaw puzzle.

Firstly I should say that RED to me is the longest continuous investment (punt/gamble, whatever) I have had in the small spec stocks area. My first involvement with RED was back in about 1996 (I may be out in some of my facts now – but alzheimers is to blame, not me ok?). Since that first purchase of Greenstone shares (as RED5 was known at that time) I have seen the share capital move from about 54 million shares (forgive me if I am out by a few million shares) to what it is today! But the reason I point this out, is that RED to me is like the trilogy “Lord Of The Rings” (I read the book in the bush whilst working in exploration many years ago, I didn’t see the movie). It has been an ever-changing adventure, and its those individual chapters of RED history that I believe are part of the reason for RED not yet achieving what it should have achieved! Let me expand a little.

In expanding a little some may say its running the risk of opening up old wounds, but without opening it up i don't think you can’t get to the root of the problem! And having got that understanding by opening it up I believe you then can get much more confidence that those past events might explain the past false starts to the share price, but will not hold up the real successes that have been achieved more recently that will also lay the foundations for the future successes: IN MY VIEW RED SHARE PRICE IS NOW SITTING AT ITS LAST LOW LEVEL BEFORE THE BIG SURGE UP!!!

While RED was GRN (Greenstone) the management group was a different group and its “sister company”, housed in the same company office, was Giralia, which had similar management and share structure, and similar limited cash. Oh how GIR has changed over the years, now with a market cap of $430 odd million and only 178 million shares on issue!

What has this got to do with RED now? – well actually I think its highly relevant and I will explain why…

First is to have people realize that having made the move from GNR to RED was a monumental struggle for those involved, with considerable emotional upheaval (to under-state the real war that was going on at that time). The transition and just prior to it was not smooth, it was all out warfare, with two principal groups of investors and interested parties involved, both diametrically opposed for various reasons but no point to elaborate on that here. The “split in the ranks” at this early stage of RED I believe has been instrumental in forming the various factions with differing opinions about RED and its likelihood of ever achieving production at Siana and becoming a successful mining house in its own rights (and IMO will be the reason why MML never contemplates a merger with RED!).

Having finally achieved the transition across to RED (with the incoming management group headed by GE and LG and another NDY lawyer as chairman) there was a continuation of personality conflicts and different motivations, resulting in a falling out between GE (as the incoming Man Dir) and the Geo in charge, and that has been a further reason in my mind as to why there remains some doubt about why RED has not got full value for the project that it has developed (Councilgritter might be able to enlighten us as I think he might be closer to the geo of that time). (By the way, I don’t know who the real names of any of the posters on HC or ASF are, but I note some of their affiliations by the commentary in the posts).

Since that time Siana has been the subject of an exhaustive series of feasibility work, which started with its drilling in about (not exactly sure!) 2003 and culminating with the sign off in 2009. But along the way there was the false start that occurred with Soc Gen offer of finance in Oct 2007 and the related placement to Southern Cross Equities clients in Nov 2007(that clearly soured SCE placees when the share price fell below 10 cents!) that amounted to nothing as the underground resource had to be drilled out and some of the placement funds were gradually used up for that process and the Soc Gen debt was not used (apart from a small interim facility to purchase the mill).

And then on a parallel basis was the Mapawa MPSA application saga, which was promised so long ago and only came to fruition in 2009.

Then there was BFS take two!

With this chequered/coloured past, there are broadly 2 groups of investors that have views about Siana’s development:

1. The group that look at the project based on it having gone through the most exhaustive BFS process, with independent and highly competent consultants involved, and give it the tick of approval. And the fact that gold has now got to a level where Siana is going to make so much more than it ever would have if it were developed a few years ago as well!
This group has grown considerably over time, and is headed by the recent insto’s becoming involved, and as time progresses towards development this group will finally overrun group 2 below!

2. The "doubters" - those that look at the past events and failures (right from GNR/RED changeover days through to the more recent past false starts) and are happy to continue to “right off” RED and Siana feed doubt into it ever becoming a successful operation. Possibly this is fed from some who don’t want to see RED succeed as well because of the past history and their unfortunate experiences, either as investors or past participants!

I believe that only once it is clear that Siana is going to be developed, with all the finance in place and the approvals complete and the contracts underway, that the group of doubters will finally lose out, and be replaced by those that will take RED to its new highs.

How high of course depends upon a couple of things, amongst others:
1. The price of gold
2. The potential of Mapawa

I would like also to have it noted that I have been to Siana, albeit a while ago now, and I have reviewed the technical information as much as I have been able to, bearing in mind I have not been an insider ever into GNR or RED, and I can say that there is nothing that I am aware of, either technical nor environmental/social that will be an impediment to Siana being developed as a very successful long life low cost mining operation.

Interestingly, Siana actually is nestled half way up a slope that has views across to the neighbouring Boyongan deposit some 4 or so kms away. I have walked up that hill (alone) and wondered if there was any likelihood of gold further up the hill, as there are places I recall that had definite quartz veining in the rocks at those upper levels. But that is for another time and I don’t want to put focus on something that is still not in the league of Siana or Mapawa as they both currently sit!
 
A couple of other points Mgm1a that should also be considered:

Us posters in these forums also provide a means for interested investors to consider the investment opportunity in stocks, including RED. We can perform that function, as a supportive marketing/PR auxillary to company PR (whether the company wants it or not, lol!) that allows our views to express gaps in the knowledge of a particular stock, albeit with our slant/prejudice on it! And our views do not have to keep having the same attribution statements that you see on all ASX releases which quite frankly are just another scapegoat disclaimer relieving any one in the official system of blame!

The big test though for us posters is to ensure that our posts remain responsible and aware of the possible outcomes to each post, and that our facts are sufficiently accurate to develop the logic and rational conclusions we seek to convey.

I don't believe its good enough to just ramp a stock for short term gain, as it will bite you in the bum eventually once you get a name for such ramps.

Also I might add, which follows from my past post referring to the doubters that have kept RED in its current trading band, and the growing number of supporters that will eventually win out big time. There are also another group, I refer to as knockers, lol, and I have been within that group for a long time and only once things started to unravel for RED did I become a convert to my position as it stands now, as being an extremely supportive shareholder and poster. I think that a number of other posters on RED threads up until the milestones being achieved were also outspoken knockers like me, so we seem to have gelled together well in these forums as we have endured the lows before the highs.

(Pity that I had to go through that knocker stage as it resulted in my dropping a stack of stock due to frustration a few years ago, now I wish I had dealt with my frustrations in a different way rather than drop precious stock at cheap prices!).
 
Hi Beatle, another very informative post. You have filled in a number of gaps in my knowledge and the background of the coy. May I ask re the GD involvement as you have referred to it previously in earlier posts. I am thin in knowledge on the earlier situation and when I spent a day at the site, GE referred to some sort of earlier bunfight but was not specific. As an aside, another speccie I forgot to mention is RML. I have been there to(last year) to check out the commercial scale trial and I have to say this one looks to have some real possibilities. AB
 
Hi Anderbond. As I mentioned in the earlier post, my intent was to try to give some background to how RED has evolved over time, so that we might collectively be aware of why there remain some obstacles to the share price. With an understanding of the potted history I have outlined, which might explain why it hasn't been an easy road to where its got, maybe we can now be convinced that with a few more nails in the coffin brought about by debt finance and work on the ground heating up those past obstacles will be overcome, with a realisation that the doubters are behind us now, and it can go to much higher highs than was previously envisaged. (On that I should also note that I spoke with one of those doubters from earlier times about 12 months ago after catching up with him in the street, and he had retained his shares but was wondering at that time if it would ever be back at 15 cents - I am sure he would be impressed with how its recovered and maybe he has now changed into a supporter now too!).

As for GE and GD, well without a long explanation I would say that the stage was set for a show down from the moment that GE got on board as GD had previously been aligned to the group that were taken out by the new blood. And the personalities clashed! (And I would say that it could not be mended now).

Again you keep pulling out other stocks that seem interesting, although RML of course is not new and has been developing Acoje for quite a long time in an area that clearly is a major Ni-Cr endowed province. The company has also had an "interesting and colourful" history (Hmmn). Again I haven't followed it closely enough to make useful comment, and from my understanding of it going to merge with another overseas group really puts more need to undertake further analysis before forming an opinion. Clearly you would have a much closer understanding on the company and especially on the merger than I.
 
Beatle - thanks for the history.I didn't know any of that!
My overweighting arises in direct proportion to the research i do with a stock, but without going to the country to check it out!
As you, anderbond and tokyo have acknowledged to have visited it useful to know its as real as the photos.

I only started when i put it in my watchlist notebook in Feb09 when it was a princely 3.7c and it was UNDER cash backing. I didn't buy as i was too consumed with portfolio destruction of GFC. But i didn't climb on till Sept, so its great to hear from folks who have been with it longer and stayed with it as it dampens my impatience to get out at less than fair value.

At the start of 2009 my trusty notebook reminds me i looked at both KCN and MML which I like a lot, but i couldn't pay more than the prices at the time beacuse i thought they were fairly priced ! They respectively have moved 4.59 to 8.50+ and 0.66 to 4.55 - sure gold has moved too but these have also moved because of able management and as you rightly point out just as importantly they are producers. I would also characterise RED's mgmt as able too and can't wait to see them get thru the operational risks ahead to the first pour for further rerating. In meantime it still lags its valuation.

I agree ASF, HC are great tools to get market intell. you'd never be able to get on your own, assuming one can judge what is worth considering or not!
Talking of the investor relations......didn't they appoint someone mid last year ?

Good luck
 
Mgm1a, actually I’m surprised you only bought in Sept 09 as I thought you had got on board much earlier.
I’m happy to fill in the gaps for you and anyone else as I think with a bit more insight to the behind the scenes maneuvering and motivations by various investors/stakeholders etc that you realize RED has had some skeletons in the cupboard that once completely stripped clean of, will finally allow it to trade at or above its NPV. That’s why I’m so comfortable despite being frustrated that it takes so long to happen!

I think that the last GFC crisis gave us all a once in a lifetime opportunity to take up highly discounted shares in many different sectors of the market and I’m no different to you in regretting not getting more of many shares in various companies (including RED) at that stage. But I guess we are learning every day, and despite knowing that the markets move in cycles I was concerned too that the world was going to end in late 2008!

With regard to RED management, particularly with the recent appointment of the project Director and some of the recent contracts awarded I’m very comfortable with the way forward for RED for development of Siana. Now that RED has got the majority of its activities etc underway I still remain unconvinced that the MD should be based in Manila, and I’m very appreciative of the work that the non-executive chairman has done over the past 6 – 12 months to keep the investment community informed and involved. I hope that RED will re-consider the current arrangement with regard to future RED PR etc which I consider to be a primary function of the MD.

With the PR, I don’t recall a specific person being appointed other than the quarterly comment a few quarters ago of RED intending to beef up its investor relations. I might be wrong with this so stand to be corrected by anyone knowing anything better.
 
Hi Guys, Yes Beatle, I have the same recollection that CJ made a comment in one of last year's reports that more attention would be paid to lifting RED's profile. In line with this, LG made a few presentations, eg to the Sydney Mining Club which I attended (and coincidentally Robert Gregory MD of RML also presented at the meeting). A copy of the RED presentation was (is) available on the coy website, and of course a great deal has happened since then. At the Sydney meeting LG made comments about the low SP relative to many others and showed a comparitive chart. Since then the SP has kicked upwards but not as much as we all would like. I feel Beatle you are right in saying that once production is underway then more interest will occur, especially if the gold price continues to trend upwards. I am unsure about whether having the MD resident for example in Oz would make that much difference, because as far as I know GD of MML is resident in the Phils and look at the MML SP! I stand to be corrected on this though? The appointment of the RED Project Director looks to be a very good one, as his background is very impressive. For example, Leighton's(his previous employer) delivered the construction of Masbate within budget and ahead of time and it appears the appointee was involved in this. As I have previously mentioned on the HC site, I remain very tranquil overall and continue to believe that RED will help underpin my retirement due in about three years(or sooner if RED really fires up lol!). As an aside, I suggest checking out the things that RML is up to..very interesting and I have also personally visited their project. I call it "investment tourism" as an alternative to "wine tourism". So far it has been much more rewarding lol!. AB
 
Hi Anderbond, and once again a very informative post, and whilst we have the same objective and motivation clearly we see things from our own different perspectives to come up with common conclusions – that makes my beliefs all the more confident for the future of RED, thanks for that Anderbond!

As for GD and MML, I thought he was still based in perth but maybe he has moved across to Phils more recently. I believe wrt GE, that his efforts and time in Manila and Surigao are appreciated as it has been necessary to get the confidence and involvement of locals which he has managed to do, but bearing in mind that RED will soon be a significant gold producer my view is that he must then start to become more openly involved in managing the company which should include considerable PR rather than continue on a daily basis with project issues which are the responsibility of the newer guys being appointed at the moment (bearing in mind GE really isn’t a production person anyway).

As for your comments re RED Project Director, I am aware that at the time of the commissioning of the Masbate mill there was a fair amount of dialogue between RED and CGA as they both purchased mills of the same type and vintage, and that dialogue helped cement a good relationship between the operating groups of both parties. This will be useful for RED when in production, especially with the Project Director having worked on both sites.

In regards to RML, clearly you have followed it very closely – I’ll keep a closer eye on it from now on. With regards to phils based companies, you may have seen the recent price move of SRM (market cap is a minnow at $9 mill), which has received an EL approval much further south in Mindanao (but prospective for porphyry copper gold type projects similar to Mapawa – but maybe less Au and more Cu). That demonstrates to me the value potential of Mapawa to RED that is not currently translated in RED share price.
 
Lovely mention in todays qtrly regarding a gold "major" shooting them a Letter of Intent regarding wanting to be first in the queue for any potential arrangements with Mapawa project. That was quick! as they only have a single drill assay to go by!

Beatle, Anderbond - there is probably a good reason for GE to be in Phillipines for a little while longer...theres lots of "majors" calling him on the blower saying they want to come over for a look it over with him....solid fundametals, shame about the soft SP.
 
Mgm1a, some good points made re the gold major and GE need to remain in Phils at the moment. My comment re GE being relocated back to australia of course does relate to the longer timeframe when the Siana development is already complete and the next phase of RED growth is all about letting the world know that RED is a significant gold producer - at the moment the only place Siana is built is in my head, Lol! (But without that vision I wouldn't be here in the first place!).

I agree with your comment about only 1 hole having been drilled on Mapawa, so we don't have conclusion as to whether the Mapawa project will develop into a mega gold-copper operation, but what that letter expressing interest does prove is that RED is being looked at even at this time by others! AND its clearly not Anglo!

The comment about Anglo in the quarterly confirms my view, that Anglo has been hanging around all along for a cheap entry based upon a deal structure that clearly was not in RED's best interest, and finally the penny has dropped that Mapawa will not come cheap to any interested party. And hopefully RED will be able to go a long way down the track by its own exploration before it even considers any other company becoming involved - and that was spelt out with the comment ...."The current treasury position of the Company will allow an aggressive exploration programme to be mounted should on-going drilling results be supportive".

In general the quarterly was very succinct in confirming its development plans and activities remain on track (possibly the debt component finalisation has slipped a couple of weeks from my reading of it) and I like the quarterly working capital report that refers to the $12 million development spend, along with $1 million exploration. And the fact we can look at the photos of Siana developing on a fortnightly basis.

Everything remains good except for Mgm1a's observation that the share price is not reflecting it. (I happened to watch a Foxtel Brokers session last night where a listener asked the broking panel about RED5 as an investment and the panel of 3 all said they had not heard of it and its start up gold production next year!). (That is why I believe there needs to be a major campaign of informing brokers, on an ongoing basis so that the market does become informed, otherwise it will always be traded by the informed investor that hears it through other means).
 
Also, it should be noted that RED continues to benefit from the price of gold moving up, currently at US1,162/oz.

RED debt finance timing may by sheer luck enable the putting away of its "gold loan" (limited to US$15 million, equivalent at the moment of ~12,900 ozs) at much higher prices, and since RED management has previously debated its longer term view of hedging, may in fact benefit from that rising gold price before ever making a decisive move - but as I understand it the overall view of the board (well the board prior to recent changes made) was to minimise the gold put into hedging.

At some point if gold continues to spike up, IMO it wouldn't hurt to hedge a year or so production, and rolling - after all, there is nothing like having a bit of insurance at these uncertain times and you still get a reasonable contango with interest rates in $A on the increase (especially when the gold price is so far above opex costs of US$351/oz and the mine is long life, of at least 10 years as the resources stand at present).
 
I'm absolutely amazed that sellers took control today, in spite of the huge discount to reasonable value based on Siana NPV - it is finished the day at 15cents having hit 14 cents mid-session, despite having an NPV valuation of RED of around 35 cps at a gold price of US$1,160/oz!

And Mapawa has the potential to add to that base case valuation!

Maybe its the fact that project finance is yet to be approved (expected within the next 6 weeks or so), or maybe its a leak from the lab that the assays for Mapawa hole 2 are not so great! (I have already mentioned previously that hole 2 was drilled orthogonally to hole1, and about 350 odd metres away from the hole 1 collar. Hole 2 has been reportedly found to have a lot more sulphides, presumedly pyrite, which may have a lower gold tenor associated, being peripheral to the core of alteration that is expected based on the normal zonation that is normally associated with these mega porphyry mineralised complexes. Please note that a lower grade hole 2 does not downgrade the total potential of the LSY prospect, it just gives an indication of the extent to where higher grade mineralisation may have chopped out.

RED continues to be steal at current prices, and if gold price remains anything like current price then RED will surely be a lot higher once the project finance is bedded down. Remember also that the current field activities are not being delayed by the project finance yet to be granted, as funds are currently being expended by RED treasury - A$61 million in bank at present!
 
To anderbond and beatle and the recent mgmia

your posts have been fantastic reading and good to see that people are offering great insight without ramping a stock:D
 
Bigukraine said:
To anderbond and beatle and the recent mgmia

your posts have been fantastic reading and good to see that people are offering great insight without ramping a stock:D
Click to expand...

Yes, I'll 2nd that. Red 5 radar looks good so far. It would be great to hear an update from Southern Cross Equities.

DYOR :D
 
Re: RED - Red 5 Limited bought in 2003 for .15

for all the wrong reasons

now there are proven reserves(?) or just probable.

anyone can get an estimate for building a mine but is it financially justified?

why has the share price gone no where?:confused:
 
get a dual listing in US OTC BB.

It is very difficult to get red on the asx in the US.

There are also many gold newsletter writers here, some of them demand publication "fees"
 
G day Guys, a quick thanks to Bigukraine and GumbyLearner for comments, I too have enjoyed the objectiveness of those on this site. You will find that Beatle is one of the best learned commentators around.
Now, Beatle the other day you mentioned SRM in passing and their very recently granted Taguibo exploration permit. At the time I had a quick look at the details and noted the position of the exploration area plus the likelihood of the potential resource containing more copper than gold as per the results to date.
I saw yesterday that SRM has now taken CGX on as a strategic investor with a 10% stake. This follows on earlier SRM announcements on capital raising which have now been replaced by the announcement re CGX. I find this very interesting, because as we know CGX has a proven track record in the Philippines. The cost of the stake to CGX is small but gives them early movers advantage if the resource does indeed prove to be substantial (or massive). The benefits to SRM are extensive as they can access CGX's expertise and skills. So this is likely to be a story well worth following.
The thing that caught my attention though is the current SP of SRM of 12c. While it may come back a bit following the issue to CGX at 6c (these things seem to be the norm), IMO it heavily reinforces the fact that RED is so underpriced as to be beyond belief, when a comparison is made between where the two coys are presently placed. In addition, the SRM news highlights the interest that has built over the last few years in the Philippines, especially since the Govt legislated to enable a mining boom as part of their economic strategy. There would be absolutely no doubt that RED would be on the radar screen of many bigger miners, so lets hope we do get to see the SP reach an appropriate level rather than possibly being taken out on "the cheap". AB
 
Hi Beatle, I know this is on wrong thread but wanted to mention the RML Quarterly Report out today gives a good up to date picture. Looks v promising IMO. Apologies to all re thread. AB
 
Hi Anderbond, and thanks for your compliment – shame that I can’t post something that allows RED share price to move up to where it should be, Lol!

I agree entirely with your conclusion regarding SRM, that in fact it demonstrates the potential value that Mapawa may ultimately add to RED, but maybe even more important is that the share price has moved considerably higher which demonstrates that finally Philippine projects are getting more recognition and interest by investors than we have seen in a long long time. And as MML and CGA have also been able to enjoy too – but of course with each of those latter companies the writing is on the wall with them producing stacks of low cost gold. Once RED does have production there is no doubt that it will also enjoy that same favourable treatment by investors, but I guess the doubters remain unconvinced of RED production still – its just a matter of time and the project finance will ease those doubts once achieved!

As for Badgers comments regarding “proven reserves” vs probable reserves. What you must realize is that in the conversion of a reserve (or more correctly resource from Indicated to Measured resource, which then moves into Proven or Probable Reserve once economic viability and pit constraints are imposed) is the cost and time involved for the additional more intensive drilling, with limited actual practical benefit – even banks accept Probable Reserves for project finance, and in practice most projects tend to favour just achieving Indicated Resources (Probable Reserves) for an operation, and in some instances a more conservative resource estimator will apply more stringent parameters to the same information to call something Indicated ( Probable Reserve) whereas another resource estimator may be prepared to call that same resource Measured ( Proved Reserve)!

In a practical sense in operations each of those resources/reserves will be infill drilled to ensure that the actual mining reserve is based on a much tighter grade control pattern and the variation from the original Base Case reserves will be carefully assessed, to give the Reconciliation which can be either way (ie up or down from the Base Case reserves estimated). I suggest whereas the Probable Reserve may have an increased level of uncertainty compared to the Proved Reserve, the Base Case cash flow model based on Probable Reserve is still a very good indication of likely value and profitability. And in any event anyone doing a discounted cash flow analysis will always look at the sensitivity of changing the grades and tonnages (along with other parameters such as costs and recovery etc) to ensure project viability remains intact. In the case of RED, the DCF analysis is based on a very low cost, long timeframe development so that the NPV remains robust based on variations of the various levels. There is no doubts about the economic viability of Siana relative to many other projects based on that analysis IMO.

[AB - thanks for your comments re RML quarterly]
 
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