Not sure if this news is good or bad. The price did not move up very much so the news is not that good.
Only the permit matters; no permit, no production = zero income.
Holders of AEZS were blown apart with failed test results. The stock value was climbing nicely until the failed announcement,then a 65% drop.
All would agree this is taking way too long, a big fat ZERO could be at the end of the TLR tunnel.
"a big fat ZERO could be at the end of the TLR tunnel."
Ron Guill is a director of the company and the largest shareholder. He is the operator ar BH. He is, due to both, privy to insider information about the prospects and the reality of BH. I find it hard to believe Mr Guill would do such a deal if there was even a hint of problems or unexpectedly low production at BH as he would leave himself, and his considerable wealth, open to tremendous potential liability in the event of future failure of TLR due to BH. In his position there just ain't no such thing as "getting out while the getting is good"!
It appears we are buying for $7 million $24 million worth of mine costs? So Ron Gull is giving up his 50% interest in the mine for basically $7 million plus an on going royalty of some kind. Why would he want to do that if the mine is close to production?
Also while TLR does have cash at the moment it does not have income until the mine gets underway. I don't quite get this deal or perhaps he just didn't want to put another dime in the mine? On the other hand TLR is not going to commit to something they can't fund so timing must be close on getting this going but still why not just sit there if you are Ron Gull.
Will be interesting and hope a good thing for us as been sitting on this one too long
So if someone gets $24M loan forgiven, plus 50% ownership of the project for $7M, then it means that information is incomplete, just to say the least. And incomplete information means that something is hidden (sorry, for too detailed explanation). And hidden (from retail investors) information means bad information (for the same investors). Any further questions?
I feel obliged to counter-balance the above-mentioned consideration; just because hope springs eternal; i.e. best-case scenario still exists (I would give it 10% chance). The best-case scenario is that old ownership structure precluded company from making deal (e.g. financing… e.g. streaming) to stay alive until production, because without urgent fund-raising it can’t move project forward at this point. All cash is gone. It will be known very soon: either new ownership brings in gold-streaming deal (positive, in this situation) or plain dilution comes (negative or, better say, very negative).
Hopefully (for current shareholders), former partner got in serious financial troubles that caused him to get out asap. It would provide some commonsense reason, at least, for this deal.
Until we know more, we don't know. You can see this a few different ways. On the good side, it's all ours. On the bad side, if the mine is about to start production, why are the joint venture partners walking away now?
This is the kind of unexpected thing that isn't supposed to happen this close to a business plan key event. I'm suspicious, but will keep an open mind.
dutch...IMO it's not like Ron Guill is walking away, he's going to support Timberline anyway he can. Let's face it, he is still a major shareholder and has a strong interest in Timberline's future success!
The deal calls for Ron Guill to acquire a combination of company stock and cash totaling 7 mil.+ a net smelter return(NSR)production royalty. All debt(costs)to date will be cancelled by Highland. This is a key point IMO. It allows Timberline to acquire less financing under favorable conditions.
I think this Butte development reported is fairly clear, Ron Guill and management thought this consolidation was in the best interest of shareholders, I agree! The protracted timeline(hydrology issue/permit delay)led to this develpment, but IMO will have positive results to shareholders once production begins and for the life of the mine(100% ownership)!
If i understand correctly, Butte Highlands JV was Ron Guill and not SMD. SMD is just their to contract mine. Ron is now by far the largest shareholder and remains a director of TLR:
Highland Mining is controlled by Ron Guill, who is also a director of the Company and the Company's largest shareholder. Mr. Guill said, "In converting a significant portion of Highland Mining's stake into a royalty interest and share position, I wish to express my continued confidence in the Butte Highlands project and in Timberline management. However, the unexpected costs and protracted timeline related to the expected volume of water discharge led me, as well as the Company, to conclude that a consolidation of the project into Timberline is in the best interest of shareholders. As Timberline's largest shareholder, I look forward to Timberline's success at Butte Highlands and at its flagship Lookout Mountain project on the South Eureka property in Nevada. I will continue to assist them in their efforts in any way that I can."
Very interesting. Read the last part of the PR:
Mine development and mining operations at Butte Highlands have been sub-contracted to Small Mine Development ("SMD"), an experienced underground mine operator which has performed mine development and mining operations for some of the largest mining companies in North America, including Newmont Mining and Barrick Gold.
Ron Guill did not walk away. I think he no longer really runs SMD as it is, he has retired so this may make sense. He has decided to convert his interest and leverage it with a big share position in TLR?
Very interesting development! This explains the South Eureka NI 43-101 delay we are expecting IMO. I'm sure past Butte drilling results had to be reviewed again before the deal was formulized. I don't see a downside to 100% ownership of Butte to Timberline shareholders. With a focus on an NI 43-101 resource estimate and final permitting phase/adjustments in motion, Timberline just gained some serious strength IMO! SHOCKER UPDATE!
Looks positive to me. Ive always gotten the sense that the structure of the JV was part of the delay. Dirksen kind of points that out......"completion of NI 43-101 related reporting, including a mineral resource estimate and preliminary economic analysis covering the first several years of gold production. Such reporting was not prioritized previously because our joint venture partner was privately funding mine development and was satisfied with internally generated project data."
TLR essentially buys Guill out and the decision making capibility to forge ahead.
Reading Dirksen's comment made me think this was a positive move....I think the JV structure has been the hangup with really getting this thing going.
Here is the quote...."completion of NI 43-101 related reporting, including a mineral resource estimate and preliminary economic analysis covering the first several years of gold production. Such reporting was not prioritized previously because our joint venture partner was privately funding mine development and was satisfied with internally generated project data."
It appears we are aquiring a nice chunk of debt for the autonomy (basically buying guill out).