The mill may have a replacement cost of $12 million.However (a) if I read their filings correctly it has a first and second mortgage on it (b)even as collateral which is fine a bank still would want evidence of cash flow to pay a mortgage, and even then it is rare that a bank would lend money to a mining company without established reserves or operating income.A smelter or refiner contract could be be an inducement for a bankfor a wroking capital line though- but still doesnt solve capital required. It may be that banks in Colorado are lending more freely than every other state in the union, maybe someone with experience with Colorado banks could comment- but a third mortgage on the mill ?
I cant comment on value of uranium caims.However there may be a confusion over estimated resources or reserves. Reserves require a feasibility study which to best of my knowledge company doesnt have. NI43-101 reports may report "historical resources" but to show a current reasource data must be relatively current. The NI43-101 is a report that provides with guidelines for what can or cant be reported, and to quote reserves there are speciifc CIMM guidelines that must be followed.Estimating the value of metals in the ground without deductions for metallurgical recoveries and costs to extact is usually frowned upon by most regulatory bodies, and often an indication of inexperience in the industry.Proving reserves takes funds , and my impression company is more focused on getting mill permitted and operational.
They already have convertibles that will result in further dilution, and just my opinion they will have to rely on more convertibles this year. Not the end of the world if they can keep advancing towards production.
I will say though CFO has a lot of various experience in finance, maybe he can find a hard money lender.
AI
