Take physic, pomp

So I get this cold-call mail from Dynasty Metals & Mining (DMM.to) this morning…

…out the blue and the first time ever, as the company is clearly chuffed about its news release this morning and probably wanted as many eyeballs on it as possible (even ones as insignificant as your humble scribes’ darkened spheres). So I shoot back a question that came to mind and DMM.to replied to that quickly, so I shoot back another question and they quickly replied to that one, too. So I then sent them what you see below, which is being shared because 1) I’m getting mails from real people (i.e. not people employed in the mining industry) asking for an opinion and 2) DMM has, so far at least, not replied to this one. I’m sure they must have suddenly got very busy or something and will reply very very soon, though.
A couple of comments, to which your welcome to reply to or comment upon if you wish. If not, that’s fine too but that decision should be taken in context of the company cold-call mailing me this morning.  
1) I understand that Ecuador law states that the country takes a minimum of 51% of gross revenues from mining. I welcome the news that DMM.to would pay less royalty and no WFT (if ever applicable, because no floor level for gold WFT has been set with any company to date, I believe) but unless mistaken, the law will still be applied here and Ecuador will get its 51% minimum, one way or another. 
2) My basic problem here is that I’d like to like DMM.to on this news but the company has a poor track record of transparency and the granting of these licences is obviously not the whole story. A company has every right to play its cards close to its chest, but when said company has a track record of obfuscation and disclosing minimum amounts of information without giving a clear picture of its situation, thereby disappointing backers and shareholders at a later date, it’s hard to take any positive looking news at face value. Just my personal opinion of course, but I’d also confidently opine that the same opinion is held by many in the marketplace. If you’d care to give a fuller picture of the new current situation at DMM Zaruma and what the company expects to achieve in the current quarter and quarters to come, I’d be more interested in picking up this story again (because I’m fully aware that the company is severely undervalued on its potential economics).
dyodd, dude

UPDATE: Nearly five hours later…

Sorry for the delay getting back to you. Our office server and internet have been down since around 10am ! Please let me know if you get this email or I will try again tomorrow.
To the best of our knowledge the “51%” is not based on gross revenue, rather the minimum government participation, according to Article 408 of the Ecuadorian Constitution, requires that the government must receive “benefits” from a project in an amount not less than that received by the Company i.e. the government must receive a minimum 50.1%. In other words it is based on the projects profits after expenses (roughly net income). The taxes that DMM will be subject to on the sale of precious metals extracted from the 5 concessions are :
·         Royalty 3% of gross sales (after refining and transportation fees);
·         15% profit sharing tax (consists of 12% to the communities and 3% to the employees);
·         24% Corporate income tax; and
·         12% IVA on applicable expenses (DMM will not recover any IVA since it will not collect any IVA on the sale of precious metals).
Dynasty is still a development stage company that is materially affected by the application of laws and regulations, which are still relatively new and untested, in country that has little mining history and virtually no modern mining infrastructure. There are still too many variables and the circumstances too dynamic to reliably predict outcomes.  As a consequence, it is still not practical to provide near term guidance regarding production at Zaruma. We expect that will change in time and are doing everything possible to advance the project towards commercial production. We will, of course, publish material news in a timely manner and our quarterly reports will continue to provide a complete and factual historical account of operations. I hope you understand our position and will follow our progress.

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