AUL 0.00% 28.5¢ austar gold limited

General Meeting

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    Howdy All

    Been a while since I posted - but I thought some would like a synopsis of the General Meeting held yesterday.

    Firstly, Bob (Chairman), Ian (NED) and Rick (MD) were present and all 6 resolutions were passed and the formal part of the meeting was concluded fairly swiftly.

    The meeting was opened up to general questions.

    "Does the business have the cash to pay the next MCO tranche?"

    The answer basically was "yes", but the impression I got was that it would be tight. The Board are looking at a number of options which could include a part payment process, R&D refund, etc. but were currently in discussion with the creditor on this matter.

    "Is NG project still viable or is it gone?"

    NG is on hold and being evaluated. When the new Board/Directors were implemented - all spending was put on hold to evaluate current projects and decide which direction the money would be best spent. NG is "not a bad project, but Morning Star is the jewel in the crown" and options are being reviewed now for the future of NG and the Board see value in that project. I would say stay tuned on this front, however my impression was that NG is not a priority.

    "What do you think the potential of Morning Star being a success?"

    Rick was very positive. All the initial data and reviews point to MS having great potential. I should note that Keith Goode (the author of the recent commissioned (isn't it refreshing to see a Board openly state that the report was paid for and not leave SH's guessing otherwise ;o) ) was also present and a very informative chap he was. The point that both Rick and Keith made was that "the basic's" hadn't been done at MS and that MNM was not going to go mining until they had taken all the necessary steps in the first instance. They did emphasis that a lot of the infrastructure was in place, that they were aware of the mistakes made by previous owners and had solutions in place and had also come across more research which I understand will be released in an update soon.

    "So, putting aside the cash position, if you had all the cash you needed to get MS into production, what time frames are we talking about?"

    Now I will say that my impression was Rick is a very considered and thoughtful guy. He took the time to think about each question and answer in a detailed and pretty thorough manner - so I am only abbreviating here. Taking all the necessary steps and getting all the data evaluated, approvals in place, etc. whilst also having the intention to get MS moving as quickly as possible - they are thinking last quarter of 2017 re production.

    "OK, so how much is going to be needed at a best guess to get MS into production?"

    Again, Rick emphasised they still had to gather all the data - but he estimated in the region of $3-5 million.

    "What is going to happen with the BC tenements?"

    They have been/will be relinquished. The direction of the Company is focused on being a gold explorer moving to gold producer.

    There was obviously a lot more that was said in relation to MS. The wrap up is that it has great potential and that the obvious dyke targets to date haven't been evaluated thoroughly. Keith was astonished in his research as to what had not been done to date and that there was a lot of "low hanging fruit". Also mentioned that Rose of Denmark is looking very positive as well. Many mistakes have been made to date with previous owners and they had learnt from those mistakes.

    Soooo...there is still a lot of work to be done. My impression is that the Board have cut a lot of the expenditure out of the business and have secured two experienced gold guys (Rick and Matt) adding to the existing gold mine manager (Ron). Whilst there is a lot of water under this MNM bridge and (dare I say it) SH wealth as well...I get the distinct impression that the new Board and Management have the capacity and knowledge to deliver on expectations, especially from a "gold production" perspective.

    As always time will tell...it always does.

    Cheers The K
 
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