To MG’s point this morning:
The PEA, PFS, FS sequence is is the wall street / finance friendly process that a company typically follows in order to move a deposit down the risk slope and up the financial-resources-available slope. Basically it is the proven process by which to identify a deposit, determine it is production worthy, and then get the resources required to put it into production. It is not a legally required process. Some companies like Gold Resource Corp have never produced a single one of those reports but have been in production for nearly 10 years.
We know this sequence is not going to apply to a portion, perhaps a significant portion, of the ADL complex. Why? Because Auryn has already made a production decision and is implementing it with their own capital for the Caren / Merlin 1 vein, and is going to do so again, according to their updates, with the Fortuna and other Merlin veins. These reports do not bring any value to Auryn at that point so why spend the money to create them beyond whatever they have already done internally to make their production decision?
This self-funding approach provides them money to continue exploration without having to raise it from the markets. And it could enable even larger production moves, such as the LDM perhaps, in time, if it makes sense, without having to follow the above process. Although, I think one could speculate safely that if / when they get to considering putting the P.Nero porphyry (or another) into production then they would be talking about a need for hundreds of millions of $$$ and then the traditional process would be more likely to apply. But that is not a 2016 or 2017 issue. Or, if they were intending to go public they would probably need to generate some type of formal reports in order to demonstrate to wall street in formal known ways what they have identified / proven to date. Else, why bother?
Not having to follow the traditional path can be good and bad. It’s good in that self-funding avoids dilution, debt, etc. But it makes for a more ambiguous path forward. What is going to happen besides ‘production’ and increasing production? How do the shareholders benefit? These are the questions Auryn will be answering in the months ahead. Right now they are just trying to establish the basics of trust via openness, communications, and execution to plan. One should expect the next level of questions like the above to be addressed by Auryn at the AGM, imo.