"We expect to get results later on in this year."

This is what I heard PG say regarding muskox. Given the way he delivers messages, this means to me that there will be no news in the Q3 report on Muskox. Anyone refute that?

At the same time, I also trust that we will hear by the end of this year.

Last Qtr report predicted a profit in Q3 on operations. I am wondering if this will occur or not. PG did elude to lots of diamonds produced from what they did crush, just at a lower grade per tonne.

A bit of a concern for me is the news and timeline of the crusher. It definitely is in place now, according to the talk and what was said. So, it is operational and hopefully will stay that way now till the end of the year.

I am nervous and lost a bundle this week. I am also way down overall, by about 50% I think. The bigger question is, is this a buying opportunity or time to get out and buy back in later. Does anyone have a quality crystal ball I could borrow?

We've had bad news, mediocre news.....but never any great news. I have cost averaged down some before this dump. I'm at the point where I'll hold and wait and see. I want some recoup before I decide to buy more. Great news just once will lift this stock and there'll be plenty opportunity to profit on an up swing. but definitely enough is enough for now. (IMHO)

Tahera's bad news a delay, not a change

Tahera Diamond Corp (2) (C:TAH)
Shares Issued 156,284,275
Last Close 10/12/2006 $1.27
Friday October 13 2006 - Street Wire

by Will Purcell

Tahera Diamond Corp.'s shareholders are not pleased. The company's shares thudded to an intraday low of $1.10, after it revealed diamond production for the summer was below expectations. The gloomy news is an unwelcome delay, not a downward revision of the rosier expectations that Tahera used to support its Jericho mine plan. Higher grades and increased production are in the forecast, but they will take longer than shareholders like.

The production problem
Tahera said it averaged about 1,700 tonnes per day at its processing plant during the third quarter, not much different from the second quarter, when Jericho handled 147,000 tonnes, or about 1,600 tonnes per day. In fact, the plant has been handling a relatively constant amount of kimberlite since the end of May.

Problems with Jericho's primary crusher were at the root of the processing woes. Tahera expected to have a replacement crusher at the site by the end of August, in time to boost the production rate in September. It was about a month late, and the third quarter ended before production improved.

Tahera's president, Peter Gillin, said that 2,000 tonnes per day remained the company's goal, but Tahera is not promising it will quickly close the gap. "These problems are never unique," said Mr. Gillin, portraying them as normal difficulties any new mine faces. "You fix one thing and it creates an issue somewhere else."

The grade worry
A production grade about 25 per cent below the forecast exacerbated Tahera's lower processing rate. A higher-grade core zone with more than one carat per tonne was the key part of the Jericho mine plan, and the company managed just 0.67 carat per tonne during the second quarter.

Tahera's poorer grade is not a reflection of a material miscalculation of its mineral resource base. Vice-president Grant Ewing said they had not yet completed a full pass across the top of the kimberlite, but what they saw so far did not cause concern about their calculated reserve or resource within the pipe.

Instead, Jericho's current grade woes resulted from a greater mix of low-grade material going to the plant than originally planned, some of which was not included in its mineral resource. That would be good news, if the resulting material generated revenues higher than the company's operating costs.

The fuel shortage is the second reason that Tahera is processing a smaller proportion of high-grade rock. The company altered its mine plan to minimize the stripping required. Although Tahera has less waste rock to strip, it has less flexibility in what kimberlite it takes out of the pit. As a result, roughly three-quarters of the processed material continues to be the lower-grade rock.

The financial worries
Tahera's gloomy news signals a losing third quarter. The company's value of production exceeded its cash production costs in June, and that sparked false hopes the mine would have a positive cash flow through the third quarter.

There is also an accounting detail. Tahera will report as revenues only the diamonds it sells, with the unsold diamonds in inventory remaining on the books as an asset. Aber Diamond Corp. went a few quarters before its Diavik profits and operating costs reached a steady state, and Tahera can expect the same, as its increasing production pulls ahead of its sorting and sales. Sales typically lag production by about a month at a diamond mine.

With Jericho underperforming, Tahera needs money. Mr. Gillin declined to say how much, but it will likely need several million dollars. Much of Tahera's annual working capital requirements occur through the fall and winter, as the company marshals supplies for shipment on the winter road.

Tahera dropped 50 cents to $1.27 Thursday on 4.41 million shares.

© 2006 Canjex Publishing Ltd.

My understanding of the process of strip is the problem. I understand now. This stripping is something that must happen over the mine, to clear the way to the better areas below. So a large surface area is opened up at the top, and what ever diamonds are there is what you get. Thats just the way it is. All open pit mines must start this way. I am corrected, Thank You.

I watched that segment on ROB TV. I watched his face over and over to see if he was lying. To me it looked as if he was telling the truth. He was asked about a take over, and he looked calm and answered the same as usual. No extra blinks with his eyes, no swallowing during or after his answer, no sighs of relief, no tensing around the mouth or eyes, no change in complection. He normally looks nervous, with a twitch in his left shoulder.

IMO I think the share price might go down again when they report in early Nov. They will be repeating the news and then telling us how they will be getting more money, and we know the money won't be coming from profits. More shares? Dilution?
IMO we won't see good share prices till we see at least 1 but better 2 quarters of profits.

Something I don't understand. We are running at 80% and we are losing money. So at 100% we just break even? In my old age my math is getting worse. So at what % mine production can we say we made money?

If I had 80% of $4.15 right now, I would be happy.

Just finished watching a national geographic (re-run?) on aptn tonite from 8 p.m. to 9 p.m.. on diamond mining in the territories. Wondering out loud if Peter pulled a favour from the PMO. Damage control or intervention?. Whichever it was timely.

I like that idea. I might feel better.

It depends on what grade they are processing, 80% of low grade top soil wont be profit turning, while 80% of high grade will probable be very profitable... should they make it there considering their cash flow problem. Like a wise teacher once told me... cash flow is like breath, without it you cant live long.

I just partly buy this "stripping" explanation. if you remember (quite some time ago), during the plant and housing/office, fuel farm (?) construction they already suggested that they were "utulizing the time" by clearing the future mine site, preparing for full scale processing, pushing (piling) aside the top grade, which was supposed to be processed at the end of the mine life (if found fiasible)...blah, blah, blah. I am only "quoting" this from memory. At that time the fuel wasn't an issue yet. Either they didn't finish that "clearing" job, or the distance of this low grade dirt pile was so much shorter to the processing plant, thus requiring less fuel to haul...? but when you know that you are short on cash, wouldn't you try to get the most out of your operation and get to the low grade much later, when you can comfortably do so? You rather face shareholders' anger to dilute their share value again by issuing more to cover your expenses? Just my poor logic though. after all I am not a mine manager or a CEO.

[quote=TAH-TimeWellSpent]My understanding of the process of strip is the problem. I understand now. This stripping is something that must happen over the mine, to clear the way to the better areas below. So a large surface area is opened up at the top, and what ever diamonds are there is what you get. Thats just the way it is. All open pit mines must start this way. I am corrected, Thank You.
>
I watched that segment on ROB TV. I watched his face over and over to see
>

I am not sure what you meant here. Could you elaborate? Did you mean the PM visit at the opening? Or are you refering to something else? Sorry, I did not see the show.

This was a documentary previously shown months ago or even perhaps last winter in regards to diamond exploration and mining in the territories and the beginning of Canada's journey into the main stage of becoming a main player as a diamond producer. It was done by the National Geographic Society. The point I was making that it was a re-run shown on 'aptn', a Canadian Native program I believe is sponsored by the Canadian Goverment. It was timely in the fact that it all of a sudden showed up again immediately after the major drop in Tahera share price. So I assume since Peter Gillan and Steven Harper are on a first name basis after the grand opening....Peter pulled a favour.
And it was a wise effort on whoever's behalf to reaffirm the diamond effort in the north and take away hopefully from investor agnst.
Sorry for any confusion.

Had an opportunity late last night to watch a re-run on Peter Gillin and the other two mining companies on Robtv. My take on Peter was that he maybe seemed annoyed to be there and have to answer questions. (IMHO) I do think he's confident by what he said that this is just another 'hicup' and nothing in their plan changes. The diamonds will come out and they are sticking to their grade targets. Maybe all that's needed is for Tahera to hire a decent PR person and leave Peter in the trenches where he possibly does better. After Peter's segment the CEO of Stornoway (SWY) was on. She was VERY impressive. (I actually got to watch her in the National Geograghic documentary also as one of many diamond mining companies represented).
Anyways, you could feel the agressiveness in her as she talked about her company and it's direction. Perhaps instead of cost averaging down more into the bottomless pit of Tahera perhaps I'll go a little long term in SWY and deversify that way. (.92 cents close on Fri for SWY)

I watched her too. I'm thinking the same. SWY looks like they are aggressively moving forward.

I watched the ROBTV report again Fri Oct 13 2006 11:30 with Victoria Russell.
I wrote what was said. Pete talks very quickly. I think the same questions come up over and over again, so it seems he has the speech memorized.
He took something that he could have spun positive, but instead turned it negative. He downplays the good. This is what was said.

Victoria: And Congratulations on opening Canada's Third Diamond Company Mine, however, yesterday you did issue a rather disappointing press release.

Pete answered: The Press release we issued a couple of days ago really dealt with ah.. change in volume expectations that ah.. occurred last quarter ah.. as they related to throughput in the plant. The plant capacity is rated at two thousand tons per day. That was our planned target umm..that over that quarter achieved seventeen hundred tons a day, which of course was disappointing. A part of the reason for that was a crusher issue we had, that was being replaced. It was replaced in late September ah.. so the benefits of it's replacement weren't there.

Victoria: But you also had problems with the grade I understand.

Pete: We had problems with our Experienced grade, that’s correct. We had some lower grade material on the top part of the kimberlite uh..which resulted in a greater number of overall diamonds, but at a lower apparent grade, because we produced processed uh..more lower grade material than we anticipated. But it's important to understand the overall resource estimate has not changed, ah..we still have five and a half million tons of .5, .85 carats uh..per ton, and that’s what will get mined over the life of this project. Uh..it just happened in the first few months and therefore appears to be more disappointing.

Victoria: All right, and it happened yesterday that there was a sell off in the shares. I guess fell by 30%

Pete: At the worst I think that’s right, yes. Um..which personally I think is an over reaction um.. because we are dealing with these issues and uh.. we'll work our way through them and uh.. things are getting better.
************************************
Thanks Pete for your great vote of confidence.

To put a positive spin on it, he should have said something like this.

First I would like to say, I am proud to announce that our long awaited rock crusher is in place and working within normal perimeters

During the months leading to September we removed more overburden than we expected. This will allow us to access the higher quality diamond bearing kimberlite in the quarters to follow. This is normal in the early stage of a diamond mines life, and was expected. What was a surprise to us was the increased area of overburden that was removed was found to have a higher number of diamonds and this was not expected in our original model. Though the diamonds found in this unexpected area were of a lesser quality, they will be used, and are a welcomed extra. This is also an indicator of what might lie ahead.

With two working rock crushers on site, we can now look forward to uninterrupted mining and better days ahead.
**********************************************
I talked with my brother-in-law, (he also owns Tahera stock), and he thought Pete must be a very stupid man. He said Pete should be honest with what he says. In the future he won't be trusted. If this is the normal operation of a mine, than say so. If the crusher is broken, say so. Pete waits till after a 1/4. All companies have problems, and they deal with them. Don't make out as if it's catastrophic.
A lot of people are being hurt over stupid remarks. It's uncalled for.

On the other side, It's a good time to buy more.
Could he be doing this on purpose? To give his friends one last chance to buy in at a low price? Never to be seen again?
Sorry for the wordy ad. Can you tell I'm still pissed?

each investor will need to decide their course of action. (btw thx for the info 'TAH-TimeWellSpent'). Personally, the only way I would cost average down would be to expedite my break even and exit. I need to see something positive by this winter to consider this stock for the longer term. I feel the damage done to the stock price will take a longer time to fix itself. And I believe Peter still needs to go. When I think of the CEO for Stornoway and how agressive she was plus she was younger also. You could tell failing was not an option. I don't get that from Peter. With Peter at the helm, a weak winter.....we will have wished that we sold at the 2.00 post price.

(IMHO)

It's tough to say which way this is going to go. It sure isn't going the way anyone expected. Another bad winter, trucks breaking in the cold, equipment failure, labour problems. could be anything. Is Peter a problem solver? He doesn't show a positive outlook! He did last year but not this year. As you said cost average down would be to expedite my break even and exit >> I think is good advise for everyone. I can't get out like this right now. I think when we hear about the 3rd 1/4, we are going to be hit again. We all need it to go up a bit to hit our break even point. Do you think that maybe thats what they want us to do? This is a huge scare tactic, and in years to come, we'll be clear of this mess, and have stories to tell our friends.

One thing I do know. No one is going to start another mine if thy can't transport materials back and forth to the mine. So someone will put in a road from the north for the summer, and a better Ice road for the winter. It has to happen sometime. De beers won't put up with another delay. De Beers has the money to do what ever they want, and so does Rio Tinto. They all need a little push. Get off their 's and get the job done.

Still pissed