via MoneyTalks - Chen Lin

I stumbled across the following interview with Chen Lin on MoneyTalks:

http://moneytalks.net/topics/precious-metals/8218-placing-bets-on-self-financing-producers.html

The ability of GBN.V to self-finance is really dependant on the gold price going forward. We haven't seen a crash that was predicted by institutions, but should the gold price advance again, this has great implications for dickensian zombie gold miners like GBN.V.

Let's say, for example we go by some of the numbers they promoted after the stunning failure of drastically curtailing production. If you take 150 tonnes @10g/t Roy Lloyd + 500 tonnes @ 7 g/t Komis, without touching their high grade stockpile from EP, and that they've run out of low grade material to process, you get over 58k oz. per year.

Quarterly production should be in the area of roughly double previous results during the disastrous production curtailment of fiscal 2013. ~14k oz. per quarter.

Once the management sees they can fully cover financing costs and operations, there should be some left over for dividends. ~0.01¢ a share after operations and a presumed $10m. per quarter cost of capital and $10m in operational costs. (~$690/oz. cash costs plus ~$690 cost of capital makes ~$1380/oz. all-in costs. Average gold prices for the quarter are ~$300/oz. higher- but there too they obtained unbelievably atrocious results on gold sales.)

Should gold prices double from here, then financing aught to be thrown out the window, since the company can self-finance AND STILL PAY OUT A DIVIDEND.

-F6