A Quick Comment On Gabriel Resources
At Bronte nosotros create got been small Gabriel Resources for closed to time. Gabriel (a Canadian company) owns a potential aureate mine inwards Romania. The biggest investor is John Paulson of "greatest merchandise inwards history" together with afterward Sino Forest fame.
The deposit has been known since antiquity together with was worked past times the Romans (presumably using slaves) together with afterward past times the foreign-exchange starved communists using the modern equivalent of slaves (which the commies called "workers" or the owners of the revolution).
Slaves create got a habit of removing most high-grade ore...
The mine was closed every bit uneconomic (loss-making) after the Fe drape fell. It simply wasn't a really practiced aureate mine - at to the lowest degree it wasn't after the slaves had picked over the ore body.
The fellowship used to create got a multi-billion dollar marketplace cap based on an one-time deposit amongst no working mine - together with which was solely lately deemed non worth fifty-fifty running...
This was odd together with warranted farther attention.
And nosotros gave it more-than-the-usual amount of attention.
We paid a police pupil inwards Romania to delineate the Communist Party archives to operate out what the commies idea the grades of the mine were together with to compare them to the (seemingly optimistic) statements of the company. [Yes - yous know a hedge fund does master copy inquiry when it is poking nearly inwards the Romanaian Communist Party archives...]
The reported grades were lower than claimed past times the fellowship (enough argue to live on short) but the divergence was solely nearly xx portion - non that dramatic. Indeed this could live on a genuine sampling fault and at that spot is piddling argue to assume that the divergence is deliberate.
If at that spot had been a dramatic divergence inwards grades nosotros would create got taken a much larger set together with danced nearly inwards joy. We are small sellers at pith - together with investigative stock picking is fun.
With shaver course of education differences together with to a greater extent than than a few environmental doubts nearly the mine nosotros maintained a little small position.
This worked well. The Romanaian Prime Minister Mr Victor Ponta - after mass protests - has decided to advise Parliament to spend upward blessing for the mine. This is hardly surprising every bit the fellowship proposed an environmentally nasty - indeed toxic - method for extracting the gold.
And then yesterday the stock entered the final-phase of its collapse - it savage a piddling over 50 portion - but it still has to a greater extent than than a quarter of a billion inwards marketplace cap! The stock is downward to 68 cents.
And the fellowship response. They plan on suing Romania for "multiple breaches of international investment treaties".
But they don't cry what treaties. Indeed I am for the most business office unaware of what treaties mightiness pertain. Influenza A virus subtype H5N1 google search for the term "breaches of international investment treaties" but without the globe "Gabriel" produces roughly nil results.
For this argue I suspect Gabriel's legal illustration is modestly overstated.
Like their aureate grades.*
John
*The overstatement of the aureate grades is my guess. As stated inwards a higher house the divergence inwards the aureate grades was non large. However I believe the grades inwards the archives for practiced reason: the Commies did a rather large mass sample on the mine past times truly mining it. It is soundless non exterior the realms of possibility that the Communists were then incompetent at extracting aureate that they underestimated the grades inwards their ain mine. In which illustration Gabriel's estimates may live on accurate. I report: yous decide.
The deposit has been known since antiquity together with was worked past times the Romans (presumably using slaves) together with afterward past times the foreign-exchange starved communists using the modern equivalent of slaves (which the commies called "workers" or the owners of the revolution).
Slaves create got a habit of removing most high-grade ore...
The mine was closed every bit uneconomic (loss-making) after the Fe drape fell. It simply wasn't a really practiced aureate mine - at to the lowest degree it wasn't after the slaves had picked over the ore body.
The fellowship used to create got a multi-billion dollar marketplace cap based on an one-time deposit amongst no working mine - together with which was solely lately deemed non worth fifty-fifty running...
This was odd together with warranted farther attention.
And nosotros gave it more-than-the-usual amount of attention.
We paid a police pupil inwards Romania to delineate the Communist Party archives to operate out what the commies idea the grades of the mine were together with to compare them to the (seemingly optimistic) statements of the company. [Yes - yous know a hedge fund does master copy inquiry when it is poking nearly inwards the Romanaian Communist Party archives...]
The reported grades were lower than claimed past times the fellowship (enough argue to live on short) but the divergence was solely nearly xx portion - non that dramatic. Indeed this could live on a genuine sampling fault and at that spot is piddling argue to assume that the divergence is deliberate.
If at that spot had been a dramatic divergence inwards grades nosotros would create got taken a much larger set together with danced nearly inwards joy. We are small sellers at pith - together with investigative stock picking is fun.
With shaver course of education differences together with to a greater extent than than a few environmental doubts nearly the mine nosotros maintained a little small position.
This worked well. The Romanaian Prime Minister Mr Victor Ponta - after mass protests - has decided to advise Parliament to spend upward blessing for the mine. This is hardly surprising every bit the fellowship proposed an environmentally nasty - indeed toxic - method for extracting the gold.
And then yesterday the stock entered the final-phase of its collapse - it savage a piddling over 50 portion - but it still has to a greater extent than than a quarter of a billion inwards marketplace cap! The stock is downward to 68 cents.
And the fellowship response. They plan on suing Romania for "multiple breaches of international investment treaties".
But they don't cry what treaties. Indeed I am for the most business office unaware of what treaties mightiness pertain. Influenza A virus subtype H5N1 google search for the term "breaches of international investment treaties" but without the globe "Gabriel" produces roughly nil results.
For this argue I suspect Gabriel's legal illustration is modestly overstated.
Like their aureate grades.*
John
*The overstatement of the aureate grades is my guess. As stated inwards a higher house the divergence inwards the aureate grades was non large. However I believe the grades inwards the archives for practiced reason: the Commies did a rather large mass sample on the mine past times truly mining it. It is soundless non exterior the realms of possibility that the Communists were then incompetent at extracting aureate that they underestimated the grades inwards their ain mine. In which illustration Gabriel's estimates may live on accurate. I report: yous decide.
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