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Update on RSG from Harry

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    Update on RSG from Harry

    Hi Harry,

    Please could you provide an update on RSG? in April you reported that their mine in Ghana might be sold to a Chinese firm - or might not, do you have any update on this? I notice RSG is (or was) ~6% short sold at the beginning of last week (9th Aug) at ~54c. It closed on Friday (13th) Aug down about 8% for the week, do you think some of this is due to short sellers closing their positions at low 50's? or the shorts just reflect uncertainty and will be maintained to lower price levels?

    Many thanks

    Nick

    Answer

    Hi Nick,

    A bit of a thorn in the side of performance over the last few weeks. Gold has been choppy though RSG seems to cop the hits while failing to rally on bounces in the commodity. Ultimately the risk, aside from the gold price, is around the sale of Bibiani given the last attempt fell over at the last hurdle with the Ghanaian Government stepping in the way of the Chinese buyer. This time looks a bit different with the blessing of the natural resources minister on the cut price deal. It’s small relative to their assets but it would knock around a third of their debt off the books – therein lies the key. It remains a high risk call but one we are holding for now.

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    Resolute Mining (RSG)
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