SDRC will show revenues before establishing reserves.
The industry standards for proving mineral reserves is a lengthy, arduous, and expensive process involving a thorough enough intersection of their in-ground resource via drills, and necessitating the hiring of accredited expertise to study, and compile the technical reporting according to strict spec. SDRC is not willing to undergo such a process without the cash on hand to do so and doesn’t see it as a priority justifying the cost (especially at this precarious pre-revenues stage.) SDRC has halted exploration in preference for a hail-mary pursuit of revenues, enabled by the discovery of high-grade historical stockpiles already mined and ready to process.
This is very much IMO the main reason that will make SDRC unique, unconventional, and a leader when successful. They are doing it backwards unlike what most companies in their position do (ie: to finance development with production as opposed to debt and unfavorable equity/royalty deals.)
I mean, for all we know, SDRC may decide to move into production and continue on producing to mine depletion without ever establishing reserves as industry standards mandate. The question then is, Why waste millions on proving something via exploration that they could do just as well by mining, processing, and selling?
The fact that SDRC can even think about building a producing mining operation without a bankable reserve is out of this world and impossible for most.
Most can’t because the norm in this industry is that managements take too much money for themselves, and don’t use money efficiently, and so getting anything done is a huge uphill battle to finance (and so proving a resource becomes a priority... and then years of feasibility studies... then once they they're done with that they need to finance construction... all while marketing to keep investors interested....). Most run out of money many times over before they see an ounce of gold out of the ground. They turn to dilution and other toxic deals which cause irreparable harm long before production even happens. This is sadly the norm which is why most mining "investors" are actually just traders of the "Lassonde Curve."
To do what SDRC is doing, most mining investors would think is either crazy or unbelievable.
Knowing what we know, that they are indeed legit, and they actually have been running this stock cheaply and efficiently, while also securing the finances to do so outside of the predatory mining norm, is our opportunity.
If revenues are anything like projected, it will be a magical moment. ….and a moment of truth for many watching on sidelines I imagine. The mining industry has been broken since the 1980’s, and its time that it is shaken up for a new generation.
AI
