Mike: Hi Mike Niehuser founder of Beacon Rock Research and with me is Larry Reaugh, President and CEO of American Manganese, that’s ticker symbol a-m-y on the Toronto Venture Exchange and Larry help me what’s the pink sheet ticker symbol?
Mike: Thank you, it’s been a while since we talked but can you give me an update of what’s important?
Larry: What important, what we are all waiting for is a prefeasibility study and we are hoping that will be out by the end of the month, if not shortly there after. The exciting thing is now that Connect Co has just now completed all, received everything they needed for that prefeasibility study and it’s been submitted to War Drop, they are able to focus now on the battery side of it and so Connect Co are going to be working on a lithiated manganese powder and we are actually going to produce some battery buttons and battery that can be tested and in order for us to prepare ourselves for the emerging battery bat market. And we certainly do have some advantages over the other operations, in that we have a hydro metallurgical process, so we don’t have the roasting or the grinding that usually introduces contaminants into the manganese itself, so we could bypass that. We hope to have a very pure product at the end of the day and that will take several months, I don’t have a time line but that should be announced here shortly and we’re really quite excited about this next leg of our operation.
Mike: So what do you think a successful for 2012 would look like for you?
Larry: Well certainly very positive prefeasibility study, a completion of all the battery testing, more work to give a lot more confidence in our pilot plant testing, we plan to do a lot more work there and of course we’re going to be drilling for water, we’re going to be drilling for structure mechanical structural work on the open pit itself and hopefully we will get an exploration program going some time this summer.
Mike: An exploration program, can you expand on that?
Larry: Well we have a resource now that’s 13.8 billion of indicated and 3.5 billion pounds of inferred but we’ve only touched about 20-25% of the property so we would like to expand on that. Plus we’ve got to take some of that indicated and turn it into a higher category, so there will be some more infield drilling to be done and that will have to be done in order to complete a feasibility study, a final feasibility. But you know we are well financed at the moment, we have about $4 million in the treasury, after the prefeasibility is out, if the market dictates we will probably raise more money, we are not that far away money wise from a final production decision, I’d say somewhere between $5 and $10 million, probably closer to $10million. So that’s not a lot of money to plan to get this thing into where we can say the production decision is made, now we will go for the capital.
Mike: You know it’s funny because most of the conversation and the direction of the company has to get to production, you have kind of surprised me there talking about exploration and the project getting bigger, because you know you have a metal type that’s unique, you have a project that’s well advanced in being derisked by the metal urgy and the work on the batteries you’ve done, and the last thing I expected is to hear you say it’s getting bigger, so it’s unique, it’s getting bigger and it’s getting further along, is that right?
Larry: Well this is it, my experience in the market, if you’re going to attract the big companies you have to have big resources and we have a world class resource there now, but we’ve hardly scratched it, I mean you can go over all over that property and look at it a base that’s 30 meters thick, that’s running 4% manganese, that doesn’t have a drill hole on it. So these are the types of resources we want to bring into the fold.
Mike: Now the prefeasibiliyty is expected about when?
Larry: Hopefully by the end of this month, or shortly there after, but they just received the last part of their stuff that they need from Connect Co to proceed with the prefeasibility study, it could get towards the middle of April I don’t know, it’s very hard to set a time line because it all depends on one little glitch and you can be out a month or two.
Mike: That’s for sure, it’s not a easy business, but you sure made good progress, after the prefeasibility, what would investors be looking for, for the next milestone or news flow through the year?
Larry: After the prefeasibility I think they would be looking for us to move on with the feasibility study, they would be looking at us to start getting into discussion with off takers. Certainly we have been doing that for the last couple of years, we have had discussion with a potential well 15 off takers. But the feeling in the markets are, they don’t want to do anything until you are getting closer to production, they don’t want to be exposed to any risk anymore. So you know, we feel that certainly after the prefeasibility there is a potential chance to get an off take agreement and a strategic partner. But the reality is, it may take a feasibility study and a production decision that would galvanize some company into action but there are some serious companies out there that really would like to tie up our metal because they know what’s happening in China and I’ll just expand on that a little bit. The Chinese are consolidating their electricalitic manganese metal, as you know they provide 98.5% of the metal. They currently, according to the National institute of Manganese the production that is sold outside of China is close to 400,000 tons and there’s only 28,000 of it produced on this side. Now China consolidating, there going to start restricting the amount that they are able to export and so it’s predicted that in 3 years, that China will be net importers, so where is that 400,000 tons and it’s growing at 5-6% a year, where is that going to come from, well certainly we can provide some it and we do have the resources to provide most of it, if we had too. But we’re looking at supplying 50,000 tons a year, 50,000 tons does disrupt the market and doesn’t make us a threat to any big producers out there, as a matter of fact we will be one of the larger producers out there once we are in production.
Mike: You mentioned investors in the market, and I think different investors come in at different times and what you mentioned about the timing in the market and the things I mentioned earlier about the size and the progress, I think you’re going to start seeing some interest all the way up until you see the decision made. Larry I want to thank you so much for taking the time to meet with me again and again I am Mike Niehuser, I am with Larry Ray, president and CEO of American Manganese, that’s ticker symbol a-m-y on the Toronto Venture Exchange and again the pink sheet symbol is?
Mike: Thanks for helping me out Larry I appreciate it and I appreciate the seat too.
Larry: Thank you, Mike good to see you.