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Frequently asked Questions

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When is the next Significant News Update?

As of 18/08/2020 the following is expected into 2020

Si capital Broker Notes
Berenberg Broker Notes
Aug Results (in Sep)
Sep Results (in Oct )
Nov Financial Results
DEC AGM
Scally info. + 3 Months, Results (with possible interim as well).
Nov Results i(n DEC)

How many exploration sites do Greatland Gold have?

As at July 2020, Greatland had 6 exploration sites: 4 in Western Australia: Paterson, Panorama, Ernest Giles, and Bromus; and 2 in Tasmania: Firetower, and Warrantina.

What is Havieron?

Havieron (tenement (E45/4701) is located in the North West of Australia, it is part of Western Australia, 1300km North East of Perth 400km South of Broome. and is part of the Patterson Hills, in the East Pilbara Shire, and contains 43 Graticules (more info on those below).

Havieron is also the name given to a small 12 x 12 Squared area in blocks in the south-east corner of the plot that is the focus of the exploration for Greatland gold and its joint venture with Newcrest Mining. upon the request for a licence to mine, the 12 blocks now have a tenement of M45/1287. https://greatlandgold.com/paterson/

What is Scallywag?

Scallywag, is located within the Havieron E45/4701 block 5-6km West of current operations. Unlike Havieron, (the target of drilling (19/2020), Scallywag compromises of 4 areas of interest, Kracken, Barbossa, Blackbeard and London.
(From the Greatland Gold Website, (https://greatlandgold.com/paterson/)

  • Kraken: A high intensity ‘bulls-eye’ magnetic anomaly with the same amplitude, character and depth extent as observed at Havieron. IP results indicate a strong chargeability anomaly coincident with the Kraken magnetic anomaly.
  • Barbossa: A large 2km by 1km residual gravity anomaly located in a structural corridor 3.5km west of the hinge of the Scallywag dome. Barbossa has semi-coincident gravity and IP chargeability anomalies.
  • Blackbeard: An elongate 2.6km by 400m ultra-high intensity magnetic anomaly with a coincident moderate amplitude gravity feature. The IP chargeability response at Blackbeard is observed over 800m of strike.
  • London: Located in a gravity low interpreted to be an intrusive rock within the hinge zone of the Scallywag antiform. The London target IP response is seen over 400m of strike as discrete chargeability anomalies.

What about BlackHills, What is that?

Once you reach the top of the E45/4701 tenement, you reach Black hills (E45/4512). much smaller than Havieron (8 Graticules). consists of 5 areas of interest Rogers, Eastern, Black Hills North, Northern Granites, and Parlay. – Black Hills South is also part of this area of interest but is in the main tenement.

It as been explored briefly in 2019 with Ip Surveys, and Ground Gravity Surveys, but to date, no work has commenced on this. https://greatlandgold.com/paterson/

Patterson Range East…

25KM north of Havieron, is Patterson Range East E45/4928 acquired in 2018, it has 4 main areas of interest, Goliath, Los Diablos, Prefect and Atlantis. ther have been both Geo Chemical and Ground Gravity Surveys carried out in 2019, Full results can be found on this page. https://greatlandgold.com/paterson/

Rudall?

20k South South East, lats 65k of Greatland Golds newest prospective tenement.
It is awaiting final approval for prospecting by the Western Australia Authorities.

https://greatlandgold.com/paterson/

Why did Newcrest give up Havieron and Scallywag, and its surrounding areas?

From PI “Hydro”
Basically, what they describe is a series of technical problems at Scallywag and Havieron, that essentially buggered up their drilling campaign. The overlying Permian Sandstone and mudstone were described as being ‘unconsolidated’ (ie quite soft sandy sandstones). It appears the drilling rigs back then in the ’90s were limited to c450-500m depth tops. But only in good ground – ie consolidated or hard rock. What happened was I gather, the drills were breaking down due to these frictional issues and the rigs not being capable of the loading required to get through such soft deep overlying cover material. It was just a limit of the available technology at the time. That led to the poor drilling results and the failure to identify Havieron or Scally from actual drill cores. Whilst they realised/suggested Havieron was worthy of further investigation – as they detected some alteration – this was never followed up due to the gold price being $300/oz. The tenements cost money to maintain so they let them go.

Edited post to keep authors spell-checker happy.

Does Greatland have enough cash?

The writers of this page, are not qualified to comment on the financial status of this company, However, the directors are happy and confident with the group’s financial position. you can read more about it on the groups latest RNS.
https://greatlandgold.com/wp-content/uploads/2014/01/GGP-Interim-results-March-2020.pdf

Why do people talk about the Martu people?

The Martu are indigenous to the Great Sandy Desert, within the Pilbara region of Western Australia. The licences of E45/4701 and E45/4512 are located in their Native Title.

Before any work can commence on this land, the WDLAC (Western Dessert Land Aboriginal Corporation) must give consent.

Greatland gold needs and will build a strong relationship with the Martu, as they will supply a local workforce, and benefit from the mine being on their land.

Who are Newcrest Mining Limited?

“Newcrest is the largest gold producer listed on the Australian Securities Exchange and one of the world’s largest gold mining companies.” https://www.newcrest.com/about-newcrest/our-company

In 2019 Greatland Gold and Newcrest Mining agreed on a deal, to explore and develop the Havieron Area, They will over a period of time earn the right to own, 70% of 12 blocks in the south-east of E45/4701, The agreement, including Joint Venture, and Tolling principles, Newcrest also have first right refusal over Black hills, and Patterson range east. Further information: https://greatlandgold.com/paterson/

What is a “farm in” agreement?

The term “farm-in” describes activities governed by an agreement between parties in relation to
ownership, exploration and exploitation of a mining tenement. However, the form that farm-ins take can
vary enormously because the needs, motivations and drivers of the parties vary from case to case.”
Source: http://www.austlii.edu.au/au/journals/AUMPLawJl/2000/61.pdf

What is a Joint Venture?

As the above discussion has shown, the concept of a “joint venture” has no clear legal or common
meaning. In some cases, farm-ins may be joint ventures. In others, they may be partnerships. But in
many cases, the distinction will be blurred such that a conservative approach finds simply contractual
relationships between the parties. Parliament chose not to define the term “joint venture” suggesting that,
in its view, it is a term that can be understood to have a common meaning. However, Parliament did
decide that a joint venture for GST purposes will not include a partnership. This exclusion does not
sufficiently delineate which arrangements come within the scope of the term.
Source: http://www.austlii.edu.au/au/journals/AUMPLawJl/2000/61.pdf

What is JORC

JORC – Joint Ore Reserves Committee

The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (‘the JORC Code’) is a professional code of practice that sets minimum standards for Public Reporting of minerals Exploration Results, Mineral Resources and Ore Reserves.

The JORC Code provides a mandatory system for the classification of minerals Exploration Results, Mineral Resources and Ore Reserves according to the levels of confidence in geological knowledge and technical and economic considerations in Public Reports.

Public Reports prepared in accordance with the JORC Code are reports prepared for the purpose of informing investors or potential investors and their advisors. They include but are not limited to, annual and quarterly company reports, press releases, information memoranda, technical papers, website postings and public presentations of Exploration Results, Mineral Resources and Ore Reserves estimate.”

Further information and reading can be found here

What is “Telfer” and why is it relevant to GGP?

“Telfer is a fly-in-fly-out mine in the Great Sandy Desert in the Pilbara of Western Australia.”
tracing its history back to 1977 Telfer has been a mine for a long time, it is currently a fly in fly out mine, it has been in its current form since around 2004, after a $1 billion redevelopment program announced in 2002. it is the largest mine in the area, the mine produces both gold D’ore, and Copper-Gold concentrate.

Telfer contains a processing plant, where it readies gold d’ore for the Perth Mint, and Gold Copper concentrates for overseas smelting.

If the decision to mine Havieron happens, the joint venture between Newcrest mining, and Greatland gold, will see Telfer process its ore on a toll process basis.
https://www.newcrest.com/our-assets/telfer

What is “toll processing”?

Toll unit processing is where a product (gold) is taken to a plant and processed for a pre agreed price. under the joint venture agreement the gold from Havieron (should it become a mine) will be transported to Telfer and processed,

This is a brilliant deal for Greatland Gold, as it reduces the startup costs, reduces the need for development at the havieron site, no permits, and best of all, no further investment, apart from the transportation method.

What is the real number of shares in issue?

Because the company has outstanding warrants and options, the number of shares outstanding changes most months. Full details of currently outstanding shares, options, warrants, and contingent liability shares can be found here: https://greatlandgold.com/company/

What are warrants?

(Thank you to “TakingMyTime” on the LSE share chat board for this information.)
Last 12 August, GGP raised funds for exploration by issuing new shares. You can read about it here: https://www.lse.co.uk/rns/GGP/greatland-gold-plc-greatland-raises-42m-and-appoints-joint-broker-q9mgbp276msbrhc.html

Briefly, they sold 225m shares at 1.85p per share. That was a good approximation of the market price at the time. Since the new shareholders weren’t getting a discount to market price, they were instead offered another incentive — warrants on a 1-1 basis. For every share they purchased, they got a warrant for another share which they could purchase at 2.5p per share. Those warrants were good for 2 years, if they aren’t exercised by August 2021 they expire.

Obviously, it made no sense back then for warrant holders to pay 2.5p per share, they could just buy them in the market for around 1.85p. But now, it makes lots of sense for them to do so, since those shares today are worth around 12p (depending on what mood the MMs are in at the time you sell, of course, LOL).

These are the warrants that are being talked about. Basically, it’s a contingent liability for the company that they have to sell these shares to the warrant holders at this absurdly low price (given today’s market) anytime the warrant holder says, “Do it now.” The drawback is it dilutes the shares. The advantage is that it gives GGP more cash to drill holes wherever on God’s blessed earth GH and CB choose.

@aidinandabettin
Right. So here’s part two. As you said, “the warrant holders buy them at 2.5p and sell them at 12p,” and as you said, “fair dues.” No one should complain about it, we might not be where we are if they hadn’t put up cash back then.

Except, maybe not. There’s no guarantee that the warrant holders who are exercising their warrants are selling — but probably most of them are. Their warrants don’t expire until next year, so why would they exercise them now, and pay that 2.5p / share, if they aren’t intending to sell them? There’s at least a few reasons they might be exercising and holding.

1. There might be tax considerations. Depending on where the warrant holders live, they might have a big tax hit when they exercise the warrants at a price far lower than the market price. Different jurisdictions have different tax rules. It might save them a lot of money on taxes to do it now when the price difference is 10p rather than next year when it is maybe 20 or 30p.

2. I haven’t researched the terms of the warrants, but they might not have the right to convert and have a vote if there’s a takeover offer (hostile or otherwise). If they don’t have that right, they may want to convert now so they have actual voting shares if that happens. If a warrant holder thinks that is imminent they might put up the cash to convert now.

3. They might just feel uncomfortable about the thing and want it done. Most people won’t be this way but some will. Maybe they want the liquidity immediately if they need it. Maybe they just aren’t logical and so won’t wait, even though from a purely mathematical / logical perspective it makes sense to wait. Whatever the reason, they are doing it.

4. Maybe they want to increase their shareholding on a break-even cash perspective. They exercise their warrants and sell 20% of the new shares, and get their money back. This isn’t entirely logical, either, logically it only makes sense to exercise the shares you want to sell, but people do that kind of thing.

Some of all those things may be happening, but mostly, people who exercise warrants early are doing so because they want to sell. So those who say the selling is probably warrant holders are certainly at least partly right.

Note: The warrant holders will certainly have the right to fully take part in any takeover, so the warrants should be included in any calculation of the distribution of takeover proceeds. I suspect they also will have the right to exercise the warrant and have a vote, despite what I said above — it will be in the documentation, one way or another. Also, warrant holders will undoubtedly exercise if there were to be a special dividend after, for instance, a sale of part or all of our share of Havieron.

Apologies if I’ve made any mistakes in these last couple of posts but I think that should give a reasonably clear picture of what’s up with the warrants.

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