People should be cashed up at this time. I think MGK is going to fall back to 1-1.1c because of the following reasons:
1. End of year tax selling
2. Too long term - the iron ore project is strategically important, but that style of iron ore will not find a market for another decade....and yet MGK is wasting money on it.
3. Great gold projects, a lot of potential, but they are spending their money too thinly over too many projects. That is not a problem if you are planning to invest in another year, or you are a director who will seek shares en lieu of all the funds spent and share price debased.
4. The state of the market - a bit of instability.
I still have confidence Union Resources (UCL.ASX) will hold because its food-related, its a huge world-class resource. There might however be technical issues, so the feasibility study is important. I also like that they have this shareholding in the largest undeveloped zinc deposit. Even if that shareholding is in question...it might be restored by a revolution in the region in the coming years...but thats very long term, but very valuable stake....if financial security. The phosphate project is the project of the day.
The feasibility study is due....and the stock is technically set for a break-out. The question is - which way? I am impressed by a phosphate deposit on the coast in a food commodities boom. Easy mining I'd say, and its an area with a history of offshore diamond mining, so there is some skills in the region. And they have a huge tenement position in the region. Offshore rig will probably suit use of contractor gear as well, so it might be easy to finance. I wonder even if they can use downstream processing facilities in Morocco up the coast in the short term for short term income. That will depend on:
1. The amenability of blends
2. The location of Moroccan processing facilities....maybe inland???
Anyway, its a large scale project which will find a market, held by a company worth bugger all.
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