Pre-revenue With Persistent LossesBeing pre-revenue with multi-year operating losses means the company lacks an internal earnings runway to self-fund exploration. That persistent deficit structurally requires external capital, increases dilution risk, and limits strategic choices absent a material discovery or transaction.
Consistent Negative Cash Flow And Cash BurnSustained negative operating and free cash flow of about $1M annually creates a recurring funding requirement. Over a multi-quarter horizon this raises recurring dilution risk, pressures management to prioritize near-term financings, and can force lower-value asset disposals if markets tighten.
Deteriorating Balance Sheet / Negative EquityThe shift to negative equity and declining total assets erodes the balance-sheet cushion needed for exploration risks. Structurally, negative equity can constrain financing options, complicate partner negotiations, and increase vulnerability to adverse market or commodity cycles absent a near-term financing solution.