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GWA.v GWSAF Gowest Gold 52 Week high. No news. Whats the story?
Many of you know, Gowest is my favorite micro explorer/developer and that I've been very close to the story for a few years now. After being up 300% this year, they still carry only a $15 million market cap while the shares are looking stronger than ever while most other shares are bleeding.
Gowest has told us in press releases, what is going to happen. They have the largest production ready project in Timmins ON without a mine. They have a 1.5 million oz high grade project with large upside, ready for a production decision. IMO, No question, they are going to move it to production and The time is now!
From the PEA (2yrs old)Up front now is the
Short Term Contract tolling option.
Initial capital requirement of $60 million
Total cash costs (including G&A) estimated at $891 per ounce at $1,200 / oz gold price
Pre-tax cash flow 28 million/yr at $1,200 gold $52 million at $1,500 gold
IRR 50% AND 2 YEAR PAY BACK
Wild card, w/additional value added to above scenario, is the ore sorting technology. Full scale production test demonstrated sucess at changing head grades from 6 g/t to 12-15 g/t gold. This was due to the uniqueness of the Bradshaw ore, allowing the ore sorter to reject the waste rock before it goes to the mill. It was sucessful in keeping 95% of the gold while getting rid of 50% of waste rock.
As to the $60M CAPEX, Some of this has been paid already and there is motivation for either of their 2 tolling partners (Xstrata Glencore or AC) at picking up some of these costs).
Xstrata may decide to pick up the roughly $15 mil to ready the mill lines for the GWA ore and AC has already said they will pick up costs for the refinery, or possibly they could trade for the rights to the rich tailing. GWA tailing have a desirable high surfer content. GWA possibly may partner in the refinery.
If they wanted to spend the CAPEX on sinking a shaft, this project will support a much larger throughput then the 1500tpd available from just the ramp. This resource is about 2% of their land holdings and is open on strike and at depth.
At any rate, Gowest is moving to production in some form. The feasibility, permits and bulk sample are coming soon. The market is soon going to catch on. If they press a good finance solution, I think the shares will move big and things will happen very fast.
You can link back for more information or I can answer most questions, but will be out for awhile.
Checkmate28
Kozuh Re St. Andrews Goldfield. Insider buying was one of the main reasons I took a bite, but lately I've taken a step back after they reduced guidance for 2014.
2 things coming, are the high grade Taylor development project and
the liklyhood that Primero might make a run at them, being as their in the back yard, adjacent to the Brigus deposit.
With the resource size, the land package, low production cost and $30mil+ cash, they are still one of the best values out there even after going from from .22 to .40 since late December.
I forgot jurisdiction. Timmins ON Abitibi region Might be the best place on earth to have a producing mine, esp since Mexico instituted the royalty.
Doubloon, I'd like to start some DD on this company and am not a premium member. I see there is much good content here on the board to get me started. If you could inbox me an e-mail or information, I could reply thereby giving my email privately.
Bobwins RE EXN.t Excellon I hear you on the relative flat production history and that was my only box I couldn't check myself.
While they dont have a flagship property funding other large development property's, they do have a strategy for growth. First remember they lost a full year due to the union block aid of several mths followed by the re-permitting/reramping, maybe why you sold. They just got back on their feet 3rd Q and are making incremental increases in tonnage through the mill. What they have, is a growing cash stash, from their highly profitable operation and they are blowing the acquisition horn loudly. $3MILLION Q3 net earnings from 200 tpd is more profit than most companies with 2000tpd.
It was the acquisition strategy that got them the fully permitted Miguel Auza mine, mill and adjacent properties in 2009 for about $5 million that provides them the production they have now.
They have a new IR person much more knowledgeable then the last. LOL, I told them to get the Aurcana info off the presentation.
I not sure the POG is going higher short term, so for me very low cost profitable producers still make sense, until the POM provides profit for the more leveraged companies.
I got some nice links from IR that I think you'll find interesting funny esp the BNN interview of Peter Crossgrove.
PETER CROSSGROVE is Executive chairman for Excellon and has been seated on 46 Corp boards. HILARIOUS, he just wrote a book and went on a tyraid against Barric Gold mgt.
Quote, Most of the directors of Barrik have never been to a mine and if they had, they wouldn't know what they were looking at.
Part one: http://watch.bnn.ca/#clip1071973
Part two: http://watch.bnn.ca/#clip1071974
Part three: http://watch.bnn.ca/#clip1071978
this piece has some strong hints on Excellons future
Also PDAC interview of the CEO
http://www.kitco.com/news/video/show/PDAC-2014/597/2014-03-05/Chasing-Cash-Flow-Not-Ounces-Excellon-CEO
GORO Nice move TO 5.75 Todays PR was final confirmation for me as to where GORO is headed. I've been waiting for confirmation that there would be enough high grade ore to feed the newly expanded mill and weighing that, against the possibility that HOC is about free to sell another piece of its holdings.
I chased it this morning paying 5.56 - 5.57 for 5000 shares.
http://www.goldresourcecorp.com/releases/GRC-2014-03-12-1.pdf
Im going to model a scenario for a later post hopefully today.
John MMT Mart Resources Expecting a run on progress and the divy anouncement any day.
The info on this piece just out summarizes the reason I added substantially a couple weeks ago.
Posted by Ace on Mark IV
From SA Advisory newsletter
I respect these guys and actually got Mart from them:
3.Mauxf~www.martresources.com
403-270-1841
Mart Resources, inc. is an international upstream oil and gas company, engaged in the exploration, development and production of oil and gas in Nigeria. The company holds interest in the Umusadege oil field. Mart owns roughly 11k bod, but because of thieves only averages around 8.5 bod. This is about to change because MAUXF is in the final stages of completing a new and much more secure pipeline that can handle up to 40k bod. We understand that MAUXF has some 35k bod behind the pipe.
Recently, MAUXF announced that the company had been granted an increase to their bank line from $100 million to $175 million!. The company is believed to be in the position to bid on additional "marginal" fields, which of course enable Mart to grow even faster.
Please visit their website and review the current presentation and current press releases. During March we will be notified of the next .05 quarterly div ( almost 2 years of div), should get Dec 31st 2013 year end numbers and by April we should see their reserve reports.
We believe that if you wait for the announcement that the pipeline is complete that you will pay double the current price. We also believe that once MAUXF is hooked up to their new and secure pipe that a more aggressive drilling program will be initiated.
We believe that production could be ramped up dramatically as soon as the line becomes operational. We have the new line completed, potentially 35k bod flowing thru the line, acquisition of additional acreage, additional stock listing and continual payment of quarterly div of .05 all could suddenly yield a stock price of $3.00-$4.00 a far cry from current depressed levels.br>
It is easy to see why we have rated MAUXF with a strong buy rating and rate it as one of our top 5 stocks to own.
Ace
Dr Air BRD.v Congrats. I saw that coming, back in April 2012 when I was posting on Brigus. I saw sentiment was bad & Id touted them as a cheap Timmins turn around in the making. I saw they changed mgt, were getting operations in order & mentioned the value of Saskatchewan. Double the market cap since then even with the 2013 smash down.
"Additional for the future is their GoldFields Saskatchewan open pit project with 1 mil oz Reserves"
http://investorshub.advfn.com/boards/post_reply.aspx?message_id=74481101
My MO, often finds bad sentiment with reasons to turn good.
Id posted the same time on the Lakeshore turn around, it being cheap, and that I was looking for the bottom. Since that bottom in June 2013, its up 500%. Not one I bought, or would buy now, but they are a whole different company now. Large numbers coming on the production end as they pay off debt, decrease costs and move towards free CF. The balance sheet cleaning up. The shares have spoken.
Right now, I see EXN.v and GORO the same way. I bought Excellon during the blockaid when I smelled the mine was going to reopen. Now their Focusing on High grade Low cost cashflow, providing a safe bet even if silver stays at current prices or lower. Their All in costs are around $14 from the newest presentation. $20million CF/YEAR coming from 200tpd is incredible.
As to GORO, I spent 74 minutes speaking with them today. Lots to say. I'll summarize when I can find some time, but I can tell you, that a base case of 1200 gold and 19 silver they should have no problems paying the divy, developing the underground and still have seed money. Steady increasing production, Incredible grades, and Im near sure, they will soon make a green production decision on switchback.
Checkmate28
DrAir TGZ.T/EDV.T all star pics, & Bobwins on EDV 1ST! USA.T, I Had a good look. Lets talk about that one. Good pic, but I think EXN.t Excellon Resources looks like a better choice going forward.
OT: Bobwins, Big Hats off to PEIX
EXN.v MC $91 MILLION
Producing 2.2 – 2.4 million silver oz. Yearly
Resource 22 million 2011 Update coming.
Grades 900+gpt 35oz/T AgEq 3 years straight. Not high grading
Q3 Net earnings of $3 million
Q3 Cash flow from ops $4.8 million ($0.09/share)
Net cash costs $7.77
All-in costs/ per AgEq OZ sold $10.65 (AIC More inclusive)
Working capital $11.7 million September 30, 2013
Constant Insider purchases
Active Company stock buyback
Mill has 55% spare capacity for growth
22 million carryover losses
5 drills turning because they have the cash
USA.v $MC 44 MILLION
Producing 2.2 – 2.4 million silver oz. Yearly
Resource 54M oz all category
Grade 10-18oz/t AgEq while high grading (reduces future grades)
Q3 Net earnings Loss $3.5 million
Q3 Net cash costs $17.67
Q3 AISC per AgEq OZ sold $22
Working capital $12.0M Sept30, 2013. Boosted by $5.8M PP Aug 2013 and $2.9M equip sale Nov
Long Term Debt $7.6 M
The differance in EV is about 40 million when you add the loan to USA MC, & cash being equal in Q3.
Yearly CF might be close to $40 million Net difference between companys so EV gap closing fast.
Excellon is another one of those companys that got operationally banged up in 2013 due to 6 mth mine closure from union blockade, but is coming back with a vengeance. Way undervalued, and I think the street needs to see what a few quarters of full production does to the balance sheet before they catch on.
As to risk, USA.t is high grading and still going backwards with cash while Excellon could survive $10 silver
As to Growth. Hard to say as their both dependent on what they find, but Excellon has 55% spare capacity at the mill.
We only have so much time to spend analyzing these companys and I could have missed something, so feel free to add in.
Checkmate28
huesos, Re GORO Thanks for the comments. I hear exactly what your saying. In my post, I said it will take a couple quarters for the positive production changes to weigh in, and I was waiting for HOC to help provide a buying, opp by selling another round. Id be a buyer.
Now with last nights news, Goro has a wildcard. Im now a believer in the new switchback discovery being economic and fast. Their pulling high grade cores with step outs from the current Aguila mine. Current 450m strike and depth. They could easily be producing from there in less than 12 months with little risk or extra CAPEX due to proximity.
If HOC sells, I smell a buying opp at worst, and soon a sharp snap up, on the shares. After being hammered by production blunders and the class action lawsuit, they've Doubled the mill capacity from CF while keeping a fair divy. Underground, they've been rehabbed the mine and increasing stopes to feed the increased mill capacity. POM is rising, and they must know good information on the new acquisition of the Canemex Resource interest. They spent $2 mill at a time when cash was low.
Right now were looking for the companys that haven't moved up the standard 50 - %100 but are set up to.
Right now GORO fits that bill and is priced as if they were still blundering their operations with $1100 gold.
I think the market likes the news tomorrow but Im waiting to see what HOC does. Thoughts on Switchback?
Checkmate28
http://finance.yahoo.com/news/gold-corporation-expands-switchback-discovery-233500554.html
The new “Switchback” discovery, located on the Company’s El Aguila Project approximately 500 meters northeast of the Company’s producing La Arista polymetallic (gold, silver, and base metals) underground mine (see maps). Step-out drilling continues to expand the high-grade mineralization, which is now explored 450 meters along strike by 450 at depth, containing significant gold, silver, copper, lead and zinc.
“We continue to drill this high priority target and are optimistic we may make a development decision for Switchback in the near term. Preliminary mine planning has begun with conceptual plans to access the Switchback mineralization from the producing underground Arista mine.”
Barry Devlin, Vice President of Exploration for Gold Resource Corporation commented, "The new gold, silver and base metals discovery at Switchback was the success story of our 2013 drilling program at the El Aguila Project. Since the first hole, we knew the Switchback zone had excellent potential because of its similarities to our Arista vein system where we are currently producing. Switchback is a 40 to 100 meter wide alteration zone containing numerous mineralized veins associated with rhyolite dikes and hosted in andesite, similar to what we see at Arista. Switchback is also open in all directions, which increases the potential for additional high-grade discoveries."
Coinmaker, Got Graphite? There is 11 times more graphite than Li in a Lithium battery.
“Gigafactory.” Tesla CEO Elon Musk raised the idea of the Gigafactory in a previous earnings call, and said that to produce 500,000 of its Gen-III cars per year, Tesla would need to build a “giga factory” that would have the equivalent of all of the world’s current production of lithium ion batteries made just for Tesla in one factory.
In a letter to shareholders Tesla confirmed that the Gigafactory is in the works. The letter says:Very shortly, we will be ready to share more information about the Tesla Gigafactory. This will allow us to achieve a major reduction in the cost of our battery packs and accelerate the pace of battery innovation. Working in partnership with our suppliers, we plan to integrate precursor material, cell, module and pack production into one facility. With this facility, we feel highly confident of being able to create a compelling and affordable electric car in approximately three years. This will also allow us to address the solar power industry’s need for a massive volume of stationary battery packs.
I'm also high on Excellon for Silver and for graphite I'll ride Energizer resources. Yes, you remember ENZR and their Vanadium deposit. Turned out they have on the same property, one of the worlds largest, highest quality, highest grade graphite resources in the world. They are near completing the feasibility study that should better the PEA. They have their mine builder and high quality mine operaters in place with the DRA contract.
They need to get that BFS out and then get through the overhang of the latest low priced financing, as investors sell shares and keep the warrants.
Goro Gold Resource Corporation Acquires Interest in Canamex
GORO to acquire 22,222,222 common shares of Canamex, on a private placement basis, at a price of Cdn $0.09 per share for the aggregate purchase price of Cdn $2,000,000. Upon completion of the share acquisition, Gold Resource Corporation anticipates that it will hold approximately 18.4% of the issued and outstanding shares of Canamex.
LoneClone, Recently you claimed access to proprietary information stating
their business model is unsustainable and that unless PMs have a great year, they will have to cut the dividend altogether as without a much higher PoG/PoS they are losing money every quarter on their production
I called you out here, because the majority of your posts here are negative to GORO and don't match the record.
In the last 2 days GORO has not only paid the divy but has committed $2 million (equal to .04/GORO share divy money) to diversify & gain exposure to the Nevada US resource market. Looks to me like they took the divy cuts and spent them on possible future company growth.
May I suggest again (copy and paste from my Dec post)
Operationally GORO is classed an exploration company. The cost of the plant expansion is expensed rather than capitalized. The entire $17 million for the 2013 plant expansion, materials, equipment and labor have been subtracted from GORO's bottom line earnings. Should be more $ for Q4 but the mill expansion is complete. This expansion doubles the mill capacity. The question will be, how fast they can get the mine capacity at par with the mill. 2013 was a tough year, trying to expand with Low price of metals and paying the divy. With the mill complete, 2014 will blow away 2013 operationally. Their only analyst is forecasting .60 in earning for 2014.
Someone here mentioned the book value for GORO as being low. Most companys need to drill off millions of ounces to get the feasibility for the banks. GORO didn't need the NI43101 to get initially financed, and hence, only drilled enough to steer them to the production metals. Only recently they started working on the report. Their low booked 43-101 resource will hold down their book value relative to their peers.
and add: before the expansion, the mill was running at about 780tpd. They've doubled the capacity to about 1500tpd from cash flow (no dilution no financing)while paying the divy. Currently, they are continuing to expand the mine capacity to match the mill. Production should ramp up steadily through the year.
I still see a couple quarters to get efficient as they have low grade development orr to deal with.
Also as you know, Hoc will be free to sell another 10% of their holdings in March to help their much needed cash situation for their other projects. Personally, I hope HOC sells and create a buying opp for myself, as GORO being in the penalty box, has not participated in the recent PM run up.
Couple more quarters, get um cheap now.
Checkmate28
Excellon Resource EXN.t Mexicos highest grade silver producer Rising production, lowering costs
Q3 Highlights
Net earnings of $3 million ($0.05/share)
Cash flow from ops $4.8 million ($0.09/share)
Sales 603,666 AgEq OZ (9-mos - 1,524,727 AgEq OZ),
Net cash costs $7.77 (9-mos - $8.77)
All-in costs/ per AgEq OZ sold $10.65 (9-mos - $15.60)
Cash corp administrative costs reduced by 37% versus Q2 2013
Cash, $9.7 million at September 30, 2013
Working capital $11.7 million September 30, 2013
"During the third quarter, despite realized silver prices of $21.40
annualized Q3 numbers at $21.40 Silver and todays share price gets:
net earnings of $12mill & P/E = 7.6
CF of $19.2 mill & P/CF ratio= 4.8
2.4 million oz AgEq production
Not bad numbers even after the run up in share price.
They were in the penalty box due to temporary blockade of the mine by a hostile union that missed the contract. Union eventually got booted off the property by the local government. This Caused a couple bad quarters but they are running very efficient now.
Currently, they are building their cash and looking for a M or A deal and will continue drilling the property looking to increase the feed rate and finding the Curd source. Currently only using about half the mill capacity.
AUMN Golden Minerals +25% today 100% last 5 days
They were on my (Trading for Cash or less list) and responded big time today.
My guess is the short interest will be down end of month.
Going to call the company and see if they are planning the mine reopening
Big day for Silver stocks.
Mart Resources (MMT.V)
Cara Jacobsen
Please see important disclaimer at end of this article
Highlights
· Rapidly growing, low cost producer of light, sweet crude with low exploration risk
· Significant reserve growth potential through drilling at Umusadege field
· Local knowledge and expertise in Nigeria – management has operated in country for more than 20 years
· Benefit of marginal field program’s lower taxes and royalties on production, and less competition for new assets
· Strong balance sheet
· Potential for growth through access to additional marginal fields released by Nigerian government and divestitures by majors operating in country
· CEO is a large personal shareholder
· Commitment to return capital to shareholders through $0.20 per share annual regular dividend and potential for special dividends of excess cash flow
· Undervalued at less than 4x 2013 CF, 0.85x 2P NPV (0.7x 3P NPV), and a 16% dividend yield
· Multiple near term catalysts should drive stock price higher over next 12 months
Company description
Mart is a growing small cap ($435MM CAD) exploration and production company producing light, sweet crude oil from the Umusadege field in the onshore Niger Delta region of Nigeria. Mart is headquartered in Calgary, Alberta, and traded on the Toronto Venture Exchange, but all operating assets are in Nigeria.
Mart operates and is developing the Umusadege field in partnership with indigenous Nigerian companies Midwestern Oil and Gas and Suntrust Oil Company, as part of the Nigerian government’s “marginal field program.” Although Nigerian geopolitical concerns heighten risk perception, Mart has effectively managed these risks through strong government relationships, the hiring of local staff and management, and community investment and outreach.
Investment Hypothesis
Summary:
Mart will grow production 2.5x at its core strategic asset, the Umusadege field, from 12,500 bbls/d in 2012 to 30,000+ bbls/d in 2015, growing earnings and cash flow per share from $0.15 to $0.60 and $0.30 to $0.75 respectively, over the same time frame. Production, earnings, and cash flow could grow even more should Mart gain access to additional marginal fields for development. Growth in production and earnings, new listings on the Toronto and London Stock Exchanges, and building of credibility with investors from stable performance and a new CFO tasked with investor relations, should drive a multiple re-rating from 4x CF to 6 – 8x. (Mart will always trade at a discount to peers located in more stable geographies.) This combination of earnings growth and multiple expansion would yield a $4.50 stock price (at the bottom of the range). Adding in $0.40 in dividends during a two year holding period yields a total return of almost 300% (a 4x) from the current share price of $1.25. Should management sale the company, an acquisition premium may yield an even higher price.
Mart faced several challenges in 2013 with a 3.5 month shut down of its sole export pipeline and delays in drilling and pipeline construction due to flooding, weather, technical issues, and vandalism. These issues caused a short term hiccup in cash flow causing investors to worry about the sustainability of Mart’s dividend. D3 feels comfortable that Mart can and will maintain its dividend and could increase the dividend in future years depending on growth and profitability. Management and board are strongly committed to returning capital to shareholders.
Wade Cherwayko, founder and CEO, is a large personal shareholder. He has publicly stated his intention to prove up the additional value at Umusadege through additional drilling and increased export capacity, add a second marginal field and bring it to production, growing total company production to 60,000 to 80,000 bbls/d, and then sell Mart to a large independent looking for access to Nigeria. Likely suspects might be Heritage Oil or Tullow Oil.
---
Mart currently produces approximately 12,500 bbls/d from six wells at its Umusadege field. All production is transported through an Agip (ENI subsidiary) pipeline to the Brass River Export Terminal on the Gulf of Guinea. Mart realizes Brass River pricing, which sells at a premium to Brent crude.
Mart’s average cash cost per barrel is approximately $31.50 (when producing at capacity), including cash taxes and royalties. At current Brent prices of around $110 per barrel, Mart generates significant cash flow, and will continue to even in the event of falling oil prices. Depletion, depreciation, and amortization (DD&A) is about $15 per barrel, allowing Mart to earn strong GAAP margins and earnings as well as strong cash flows. Taxes will increase in 2014, but Mart will still generate strong returns.
Production has grown from nothing in 2007 to 12,500 bbls/d currently. In the last three years, Mart has increased reserves by 26% annually, after depletion caused by production. Current production is constrained by export pipeline capacity. The six wells currently producing have capacity to produce approximately 18,000 bbls/d, but Mart is limited to 12,500 by AGIP. Mart was recently awarded additional capacity in the AGIP pipeline, but equipment upgrades on the pipeline are required before they can flow the additional oil.
Mart is currently finalizing a crude handling agreement with Shell, which will allow Mart to export crude through Shell’s pipeline to the Forcados Export Terminal in Eastern Nigeria. The crude sales agreement between Shell and mart has already been signed. Announcement of the final crude handling agreement has been delayed several times, but D3 understands the delay is purely due to process, not a fundamental disagreement. Construction of a 50km trunk line connecting Mart’s operations to the existing Shell pipeline is fully permitted and under construction with “right of ways” secured and should be completed at the end of Q1 2014. Mart has a partial ownership in the pipeline, requiring a modest capex investment that has already been funded. Mart will have 40,000 bbls/d of export capacity at the Shell pipeline when it comes online, and intends to retain its existing capacity through AGIP as well. Shell has better security along its pipeline than Agip, protecting the pipeline against “bunkering”, which is rampant in Nigeria. “Bunkering” is what they call thieves who tap into oil pipeline and siphon off production to sell on the black market. This bunkering causes pipeline losses in the billions on an annual basis in the country. We assume pipeline losses will decline to approximately 8 – 10% from approximately 16-18% currently when Mart shifts export routes, increasing production, cash flow, and NPV of reserves. In addition, we expect less days downtime, as Mart will have an alternative route for export should one pipeline be down due to equipment failure, adverse weather conditions, or vandals. In addition, Mart could sell its excess pipeline capacity to third party producers to earn a spread.
Mart recently completed construction of a new processing facility at Umusadege field, increasing its internal production capacity to 35,000 bbls/d. A seventh well, UMU 10, has been drilled and tested. Based on this initial data, UMU 10 should produce approximately 4,000 bbl/d, from 2 sands. The sands at UMU 10 (6 total being tested) are not currently included in 2P reserves of 17.8M barrels. Mart completed drilling of UMU 11 in September and is currently logging, surveying, and sampling. Mart recently brought a second drill rig on site (owns the first rig). The second rig is drilling a water disposal well and will re-enter an old well to drill a horizontally when the water disposal well is completed. The horizontal well should produce approximately 2x the bbls/d as similar vertical wells in the field. These three development wells should increase production capacity to approximately 34,000 bbls/d (from the current 18k capacity). They will be tied into the Umugini (Shell) pipeline, when it is completed, which will more than double production from current levels. We assume this production level will be achieved Q3 2014. The randomness of weather and Nigerian bureaucracy cause us to be cautious about forecasting timelines, but significant progress has been made executing on these goals since we have been an investor.
After completion of the development wells, Mart intends to drill exploration wells to the East and West of the current core of the Umusadege field to increase reserves and future production. Drilling of exploration wells will only come after Mart has drilled up the capacity to significantly increase near term production. We expect an updated reserve report in Q2 or Q3 2014 with a significant increase in reserves, adding in the additional development wells and lowering loss reserves for pipeline bunkering.
Mart’s deal with partners Midwestern and Suntrust requires Mart to put up 100% of development capital, but then take an outsized share of cash flows from new wells until it has fully recouped its investment. For this reason, Mart’s share of cash flow fluctuates greatly, but should average about 62.5% over the long term.
This trajectory suggests that Mart will grow from a 12,500 bbl/d average in 2012 to 30,000+ bbls/d for the full year 2015, assuming no further development or acquisitions. This may be a conservative assumption. Mart hasn’t pursued further development of the Umusadege field in the past due to a lack of export capacity and an unwillingness by local partners to invest capital that will not generate near term cash flow. With capacity to generate returns on investment, we expect Mart will develop Umusadege to take full advantage of its new production facility and export capacity. Mart’s local partners are not publicly traded, and therefore are not concerned with reported reserve levels, which has been a challenge for Mart, as proven reserves do not give the company a long horizon for production. They are working with Suntrust and Midwestern Oil to approve spending on field development despite not recognizing a near term cash ROI.
In addition, Mart hopes to get access to additional fields through Nigeria’s marginal field program. The government has indicated plans to release additional fields, but the allocation of the fields continues to be delayed. Given’s Mart’s success at Umusadege field, one of the most successful assets from the original marginal field allocation, and its alliance with the Niger State government and with two highly respected indigenous partners, we would expect Mart to be successful in the next allocation. Cherwayko spends a significant portion of his time building and maintaining relations with all levels of the Nigerian government. It is public information which fields will be allocated, and Mart has already identified its desired assets and local partners. Mart hopes to gain access to additional fields in 2014 and begin production in 2015. Because the marginal fields have proven reserves, time from purchase to production should be minimal.
There is a possibility that Mart could merge with a domestic partner, giving that partner 51% ownership in the company. This would allow Mart direct access to marginal fields, as opposed to operating through domestic partners. Such a transaction would improve well economics, as Mart would be entitled to 100% of cash flow, as opposed to its current average of 62.5%. It would also allow Mart to achieve its current advantageous economics (discounted royalties and taxes) on all fields in Nigeria, as opposed to only fields in the marginal program, in which case we would expect Mart to acquire high quality assets in the near term. The Majors have been selling onshore assets in Nigeria recently as they expand to Offshore areas with much larger reserve potential. Mart has looked at these deals but the prices paid have not met their return requirements, and without the tax and royalty advantages they currently have at Umusadege, looked even less attractive.
Mart is currently pursuing listings on the Toronto and London Stock Exchanges, which should help drive volume and multiple, as more investors gain access to the shares and the Mart story.
Nigeria Overview
Nigeria is the most populous country in Africa, with an estimated 160 million people, and is one of the most rapidly growing economies on the continent and in the world. Nigeria has the largest oil and gas reserves in Sub-Saharan Africa with an estimated 30B+ bbls of oil and 30Tcf of natural gas. Estimates suggest Nigeria produces 2.3M bbls of oil per day, making it the 12th largest producer in the world. (Some industry experts are skeptical of figures released by the Nigerian Government.) Major Oil companies have operated in Nigeria for decades, as have large independents; infrastructure and fiscal and regulatory regimes for oil and gas production are well established and stable.
Of 1,000 field discoveries in the country, only 35% are producing, and major oil has shifted its focus offshore. Despite the large reserve and production base, Nigeria has struggled to develop a domestic oil industry. Oil and gas production generates 80% of government revenue and 95% of Nigerian foreign trade. The government is motivated to increase production and therefore revenues, and has a stated target of 4 million bbls/d.
Nigeria’s marginal field program was initiated in 2001 to drive growth of a domestic oil industry. In 2003, 24 fields were allocated to locally owned firms. The operators of these fields enjoy lower royalties (paid both to government and original field owners) and lower profit tax. Competition for these assets is relatively low, as they are only available to indigenous firms, or foreign firms operating in partnership with indigenous companies. Umusadege has been one of Nigeria’s best performing fields in the program. Approximately 130 fields were originally identified for the program, and the government intends to release another tranche of fields in the coming year.
The Niger Delta used to see regular attacks on oilfield production, but the majority of this activity subsided 4 – 5 years ago. Currently the main risk to production is siphoning of oil from export pipelines, causing lower production, revenues, and cash flows. Pipeline losses are part of doing business in country, and companies and analysts take this into account in their estimates.
The northern region of Nigeria continues to suffer from violent attacks by the Islamist terrorist group, the Boko Haram, which started in 2009. The conflict is religious, and to date has been confined to the Northeast region of Nigeria, away from the business and economic center of the country, Lagos, as well as the oil producing Delta region. Nigerian experts D3 has consulted with, including local businesspeople, and media reports suggest that the violence will remain confined to the North. However, as the South becomes more and more prosperous and the North continues to struggle with poverty and lack of education and services, larger problems could emerge.
Disclaimer
This article includes discussion of a company or companies in which The D3 Family Funds has significant publicly disclosed investments. As investors in the Funds, the principals of Nierenberg Investment Management Company (“NIMCO”) have personal financial interests in the value of those investments. This article is for informational purposes and to contribute to a general discussion about value investing generally. None of The D3 Family Funds, NIMCO or David Nierenberg is soliciting any investment in the Funds or in any of The D3 Family Funds’ portfolio companies.
The statements contained in this article with respect to specific companies and general market and economic conditions are based either on publicly-available information or on the internal analyses of NIMCO, reflecting its own subjective judgments at a particular moment in time. We undertake no duty to update any information. None of The D3 Family Funds, NIMCO or any of its directors, officers or employees assumes any responsibility for the accuracy of the public information relied on nor the correctness of its analyses and judgments. Those statements are not intended as investment advice to, and should not be relied on by, you or any other investor or prospective investor. To the extent those statements reflect assessments of possible future developments, those assessments are forward-looking statements and, as such, are inherently subject to the uncertainties associated with all assessments of future events. Actual developments may materially differ as a result of circumstances affecting any specific company that is discussed, including developments related individually to that company or its industry as well as market conditions and the economic environment. Important information about the public companies identified in this presentation and the accompanying remarks—including information about their businesses, operations, financial results, risks and other matters-- can be found at www.sedar.com.
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MMT.v Couple solid reports from the Mark IV Board
$20bn Oil Revenue: US Ready To Assist Nigeria – Envoy
http://leadership.ng/news/345837/20bn-oil-revenue-us-ready-assist-nigeria-envoy
Abubakar Salihi
— February 17, 2014
The United States’ ambassador to Nigeria, Ambassador James Entwistle, has said that the US will be glad to carry out a neutral investigation into the Nigeria’s $20 billion missing oil revenue.
CBN governor Sanusi Lamido Sanusi had claimed in a Senate hearing that $20 million oil revenue was still unaccounted for by the NNPC, a claim the corporation stoutly denies.
But in an exclusive interview with our reporter during his visit to Kano State, James Entwistle stated that this development was part of US government’s response to the request put forward by Nigeria’s President Goodluck Jonathan in his meeting with President Obama last September.
According to the US Envoy, President Jonathan said to Obama: “Look, why don’t you help in investigating oil bunkering and theft in my country”. Obama replied, “I will see what I can do.”
Entwistle added that in line with US government’s commitment towards recovering $20 billion missing oil revenue, if Nigeria’s financial institutions witness any unusual financial transactions, the government should not hesitate to notify US representative in the country for investigation.
In what appears as if US envoy doubted Nigeria’s government readiness in combating oil bunkering, he told LEADERSHIP: “I was surprised when I took a helicopter above Niger Delta; it revealed to me that oil bunkering is not hidden from the federal government, or anybody. My conclusion is very simple: some people must know what is going on.”
He noted that though corruption is the big issue in America and the world over, it requires Nigeria’s and any other countries’ concerted effort through provision of relevant laws.
Speaking on insurgency, US ambassador said that it takes an effective counter-insurgency policy to fight somebody who had entangled himself with the civilian population Boko Haram, saying that America has provided not only a military assistance but support to Nigeria’s economy in ensuring job creation via youth empowerment.
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Kozuh Mart LOL and you kept it on topic.
Did you mean, clearly the margins are more in the black for
OIL-THEFT companies?
After a year of waiting, 2014 Should be a banner year for Mart.
They double the divy by year end, and I'll be at 100% yearly yield on my original shares.
good Analyst on MMT.v Mart Resources
http://www.investorvillage.com/smbd.asp?mb=12706&mn=8519&pt=msg&mid=13547637
GOOD STUFF
Kozuh MMT.v MAUXF I added last week and more yesterday with some Coastal Energy Funds. Planets are aligning in every way and news flow should be strong these first 2 quarters. The plan was to load up before Bobwins and Dr Air publicly declared their back in. Was hoping the cat would stay in the bag for a little longer.
GCM.t 1.75 +.75 last 5 days. Nice run on the derisking press release a few days ago.
Gran Colombia Gold announces management restructuring, further cost reductions to deliver an all-in sustaining cost of $950 per ounce in 2014 and receipt of a $4 million bridge loan
Another sleeper awakened
Aurcana AUN.v Breaking news in this interview with Lenic Rodriquez
Sorry about double posting. Thats twice this mth.
Kozuh Re AUN.v I've had enough of Lenic Rodriguez. When Aurcana gets off the mat, Ill be looking for the sell button. They've stroked us far to long. LeNegra is producing 3000tpd with the expansion but at lower grades temporarily.
Higher grade non developmental ore, $25 silver and Shafter reopening might be the perfect storm.
Kozuh Re AUN.v I've had enough of Lenic Rodriguez. When Aurcana gets off the mat, Ill be looking for the sell button. They've stroked us far to long. LeNegra is producing 3000tpd with the expansion but at lower grades temporarily.
Higher grade non developmental ore, $25 silver and Shafter reopening might be the perfect storm.
Traderfan GWA.v Gowest Traded .10 today Congratulations
Been here posting Gowest for about 2 years. I've personally met with mgt a few times and they always answer the phone. Honesty and integrity is always what impressed me most. There is NO BS from these guys. From the beginning, they've stuck with the plan and made forward progress with much they don't even talk about. Happy to say I'm about even now thanks to averaging down.
With the sector in the dumpster & extra risk for non producers, I stopped posting GWA but never stopped believing in the quality of the resource and that Gowest mgt would take them to production as efficiently as possible. Insiders own a lot and I've watched the insiders spend 100's of thousands buying on the open market consistently even over .30/ share.
The guy in charge of technical should know what hes buying. When the cash raises come, the insiders step up. For this reason they will work their hardest keeping dilution to a minimum.
Faith in the deposit and the team helps me sleep at night, believing the money will be there when the time is right. They've only scratched the surface on the exploration side.
One might wonder, if things were that hot underground, they would have found it long ago? Truth is, in the most productive area in all of Canada, the Abitibi/Timmins area, due to the heavy overburden, previous discovery standards, wouldn't work. Soil sampling was useless and out crops rare. Its the newer technology fly over magnetic geo samples that map out the gold.
After GWA produces the bulk sample to UC, grades, metallurgy and recovery check out, The two potential tolling partners could each pay upfront for the processing CAPEX. This greatly reduces the $60 CAPEX called for and GWA would have everything in place to get the rest.
What do I really think ???? I think that there's a whole gold camp on their property alone and they can produce profitability from Bradshaw alone at 5000tpd which blows away what we see.
Just my opinions only and I could easily be wrong
GLTA Checkmate28
Thanks Kozuh. Ill post later when I free some time, more on how I think they can get this done without diluting out the shareholders to much and how Gowest could take this beyond tolling.
GWA.v Gowest Gold +%50 today and +%100 for the week. Anyone read my post? Potentially, from the PEA, they could be processing 95,000 oz/yr from a $60 mil CAPEX.
Gowest has aligned world class partners and their at the table listening to the Gowest pitch. That alone is a jumbo accomplishment most developers would dream of. Gowest needs only to pull out the bulk sample to prove to big guys that what they say they have, they really do have. Grades need to be there and metallurgy needs to work. Gowest is underground now working on the feasibility requirements and progress will be forth coming.
Xstrata Glencore & United Commodities AG have much to gain by tolling for Gowest as Gowest deposit is large enough to supply a large stream of ore allowing the 2 companies, at their own costs, to set up the processing lines. Xstrata has 2 open lines at the Timmins Kidd mine that just need to be re tuned for the Gowest orr. Xstrata recently spent $120 million to upgrade these lines. They are exhausting the current mine and cant use the 4 current lines. They want Gowest and likewise for the city of Timmins, that wants to keep the 1600 citizens employed.
Gowests resource is 1.5 million oz at over 4 gpt with a 3gpt cutoff. The Bradshaw strike of 1350m and still open is one of the largest strike lengths ever in the history of the Timmins mining camp plus its open on strike and at depth. Thats very high grade and Glencore is probably interested in the upside here. More on this later.
Gowests Experienced on board Mine Development Team , stacked with 20 yr vetrans is more than most developers would dream of and a factor in providing confidence for Xtrata Glencore.
Darrin Konnigen former VP-Operations and VP-Engineering for Castle Gold Corp along with Garth Wilcox designed, built and commissioned two operating gold mines. These mines paved the sale of Castle Gold to Argonaut Gold for $140 million, or $1.29/shr at the end of 2009 after trading at $0.20 at the beginning of 2009. Still a highly profitable mine.
Director: Larry Phillips one of the original founders of IAMGOLD.
John Frostiak, PEng, Director Corporate Project Manager for Barrick Gold Corporation brings the refractory experience Gowest needs. At the Cambell mine in Canada, he managed the process selection, engineering, design, and construction of the autoclave and other modernization projects.
Checkmate28
GWA.V Gowest Gold, Time for an update as they've taken another nice step at derisking the project.
Were talking about a $6million dollar MC company that has some risk attached, so this isn't for everybody. You probably shouldn't buy this in todays market unless you understand the risk and what they are doing. They are not producing anything and are short on cash. Disclosure out of the way.
Pertaining to yesterdays News Release
Gowest Memorandum of Understanding (MOU) with United Commodities AG
http://web.tmxmoney.com/article.php?newsid=65178111&qm_symbol=GWA
Gowest Gold is a $6 million MC company that probably has the best qualiry, largest gold resource without a mine in the Timmins ON area. They are moving a 1.5 million oz project towards production in todays market. Their 1.5 million oz NI43101 resource comes from one target and there are 17 other targets, some partially delineated, some located from fly over magnetic testing. I'll carry on with my post from Stockhouse.
Gowest mgt again, in the worst market for financing in decades, showed resourcefulness by finding another share holder friendly path to production with lower Capital expenditures while keeping dilution to a minimum.
If these agreements gel, operationally Gowest has their solution. Gowest would process the 90gpt concentrate at the Xstrata Kidd mine and send it down the road about 200 kilometers to the Cobalt refinery. At that point the shipping volume is greatly reduced by the 90gpt concentrate.
My math: 95,000 oz/yr production =8000 oz/mth or 248,000 grams.
at 90 gpt concentrate, they would have to move 2755 tons of concentrate/mth. the 200km.
At $1250 Au, 8000 oz Au, represents $10 million in gold. Trucking or rail costs ? my guess is $40/ton or less = $13/oz gold. Any body out there can help on this cost, let us know.
United Commodities is a perfect fit. Based out of Zurich Switzerland, they are specifically equipped and licensed to handle Gowests refractory ore. They would build a refinery at their own cost for Gowest and give them the option to partner in the refinery. Gowest has already purchased the Con mine autoclave and some other equip. The Autoclave is probably the most expensive piece by far. It was working fine when the Con mine closed. They could use that as a large contribution to their buyin of the refinery and save about 2 years of build time. UG would also benefit by using their patented CRT Clean refining technology to pull the remaining metals from the tailings for profit. This technology is embraced by local governments as it cleans up pollution so this should help the permitting process that UC is responsible for.
So what Gowest is missing is still the CAPEX dollars to finance the production solution. Current PEA calls for $60 million Capex for the contract solution and that includes the engineering work their doing now and the underground. The PEA shows net cash flow of $28 million before tax with an IRR of %50 at $1200 gold. They wont need the whole $60 million to start producing as they will start with a ramp that can access the shallow high grade ore. They are working now towards the full Feasibility Study that should be out soon and a key for any financing agreements. The bulk sample to UC will be a key determiner for future progress.
Possible solutions for CAPEX money other than straight equity financing:
From reading the PEA I know the Gowest tailings are worth a lot of money in millions because of the left over metals and the high amount of sulfur. This surfer is also of great benefit, as fuel to run the autoclave. The sulfur would help UT as well. Under the MOU, Gowest would get paid cash for a portion of the tailing profits, and for the refining of their ore. Possibly They could get an upfront loan for the rights to the tailings proceeds? I have some DD on UT for the next post on SH.
Also under the terms of the MOU, UT has the option to invest in Gowest mining operations. UT could invest CASH for equity at fair rates to shareholders?
Xstrata was a $77 billion dollar global company before Glencore bought them. Glencore is even larger. UT is a publicly traded global company out of Switzerland with a $91 million MC. Gowest has done well here, surrounding itself with good companys. These company's, no doubt have done DD on Gowest before signing agreements. Xstrata hired a separate engineering company to do additional DD. Surly, they see a marketable resource on the Frankfield property or they would not have signed agreements with Gowest. Gowest is a $6million MC company. One only needs to connect the dots and fill in a couple blanks to see where this can go and realize the risk reward ratio is very good here. None of these other companies is going to put this all together, Gowest still has to raise the cash somewhere, and at the same time, keep all the pieces together.
Checkmate28
Read more at http://www.stockhouse.com/companies/bullboard/v.gwa/gowest-gold-ltd#0rUqiLdyMpzMglkp.99
GWA.V Gowest Gold Time for an update as they've taken another nice step at derisking the project.
Were talking about a $6million dollar MC company that has some risk attached, so this isn't for everybody. You probably shouldn't buy this in todays market unless you understand the risk and what they are doing. They are not producing anything and are short on cash. Disclosure out of the way.
Pertaining to yesterdays News Release
Gowest Memorandum of Understanding (MOU) with United Commodities AG
http://web.tmxmoney.com/article.php?newsid=65178111&qm_symbol=GWA
What they are is a $6 million MC company that probably has the best qualiry, largest gold resource without a mine in the Timmins ON area. They are moving a 1.5 million oz project towards production in todays market. I'll carry on with my post from Stockhouse.
Gowest mgt again, in the worst market for financing in decades, showed resourcefulness by finding another share holder friendly path to production with lower Capital expenditures while keeping dilution to a minimum.
If these agreements gel, operationally Gowest has their solution. Gowest would process the 90gpt concentrate at the Xstrata Kidd mine and send it down the road about 200 kilometers to the Cobalt refinery. At that point the shipping volume is greatly reduced by the 90gpt concentrate.
My math: 95,000 oz/yr production =8000 oz/mth or 248,000 grams.
at 90 gpt concentrate, they would have to move 2755 tons of concentrate/mth. the 200km.
At $1250 Au, 8000 oz Au, represents $10 million in gold. Trucking or rail costs ? my guess is $40/ton or less = $13/oz gold. Any body out there can help on this cost, let us know.
United Commodities is a perfect fit. Based out of Zurich Switzerland, they are specifically equipped and licensed to handle Gowests refractory ore. They would build a refinery at their own cost for Gowest and give them the option to partner in the refinery. Gowest has already purchased the Con mine autoclave and some other equip. The Autoclave is probably the most expensive piece by far. It was working fine when the Con mine closed. They could use that as a large contribution to their buyin of the refinery and save about 2 years of build time. UG would also benefit by using their patented CRT Clean refining technology to pull the remaining metals from the tailings for profit. This technology is embraced by local governments as it cleans up pollution so this should help the permitting process that UC is responsible for.
So what Gowest is missing is still the CAPEX dollars to finance the production solution. Current PEA calls for $60 million Capex for the contract solution and that includes the engineering work their doing now and the underground. The PEA shows net cash flow of $28 million before tax with an IRR of %50 at $1200 gold. They wont need the whole $60 million to start producing as they will start with a ramp that can access the shallow high grade ore. They are working now towards the full Feasibility Study that should be out soon and a key for any financing agreements. The bulk sample to UC will be a key determiner for future progress.
Possible solutions for CAPEX money other than straight equity financing:
From reading the PEA I know the Gowest tailings are worth a lot of money in millions because of the left over metals and the high amount of sulfur. This surfer is also of great benefit, as fuel to run the autoclave. The sulfur would help UT as well. Under the MOU, Gowest would get paid cash for a portion of the tailing profits, but Possibly They could get an upfront loan for the rights to the tailings proceeds? I have some DD on UT for the next post on SH.
Also under the terms of the MOU, UT has the option to invest in Gowest mining operations. UT could invest CASH for equity at fair rates to shareholders?
Xstrata was a $77 billion dollar global company before Glencore bought them. Glencore is even larger. UT is a publicly traded global company out of Switzerland with a $91 million MC. Gowest has done well here, surrounding itself with good companys. These company's, no doubt have done DD on Gowest before signing agreements. Xstrata hired a separate engineering company to do additional DD. Surly, they see a marketable resource on the Frankfield property or they would not have signed agreements with Gowest. Gowest is a $6million MC company. One only needs to connect the dots and fill in a couple blanks to see where this can go and realize the risk reward ratio is very good here. None of these other companies is going to put this all together, Gowest still has to raise the cash somewhere, and at the same time, keep all the pieces together.
Checkmate28
Read more at http://www.stockhouse.com/companies/bullboard/v.gwa/gowest-gold-ltd#0rUqiLdyMpzMglkp.99
AUM.V Golden Minerals now up over 100%, trading as high as 1.10 today since trading at .44 in Dec 2013 and my last 2 postings. The american symbol AUMN should open up 20% tomorrow and usually trades much higher volume. Golden minerals was an incredible value trading at cash with the resource, mill and mine for free. Only about 50 million shares out and very small float. In 2011, traders thought $28/ share was a fair price. I believe a short position is unwinding due to the threat of higher metals.
If the price of Silver gets over $25, they will probably reopen the mine and the PPS will probably move very hard up.
They closed the mine for a couple reasons. One the POS and 2) they inherited the unionized miners when they attained the mine. Mgt told me they were getting like 35% from their lazy Arses. Well they didn't say it like that LOL. They took the opportunity given by the POS to clean house, and continued developing the underground as they just got their ramp completed.
Checkmate28
Cork MTO.v Metanor You've been on to something good there. As you already know Metanor struggled, but has gotten over the hump and is about to see some real progress. Right now I like the Timmins and Abitibi miners the best and Ill pay the premium for this jurisdiction, since Mexico just added the royalty. Most are roaring right now.
Bachelor has 1.6m oz high grade ore 7.38gpt, Open at depth and on strike all directions. They've hit a 5100/tpd run rate already from their 1200 tpd mill and mine. Replacement cost for the mill and underground is $150mill alone. At these grades they are going to Cash flow very well starting around now, even at the 50 - 60,000 oz/year run rate and $1250+ gold. They have loss carry forward over $50 million to help cash flow and the loss makes things tempting for the circling sharks.
The future is very bright as well and I see Bachelor paving the way. They are planning on increasing the mill capacity at Bachelor by 50% at just $4 million CAPEX and targeting 80,000 - 90,000 oz Gold/year in 2015 their alone.
Additionally their Barry deposit is a potential 10M+ ounce Open pit target; SGS Geostat has identified Metanor’s Barry deposit as comparable in potential to rival other multi-million ounce deposits such as Osisko's Malartic gold deposit & Detour Gold's Detour deposit. All they need is to set up a concentrator and ship the concentrate down the road to Bachelor where they have plenty of capacity to produce the bars. The PEA for this plan comes in at a whopping 87%IRR at $1275 gold.
These 2 mines could produce 150 -180koz in a few years and would put Metanor in mid tier status. To pay for production and keep debt down, they sold 20% of their Bachelor production to Sandstrum for $20 mil, they pay $500/oz so that covers much of the cost. Barry is free from the agreement. I see them similar to Lakeshore Gold in a sense that the hardest work is done and now they need to clean up their operations and balance sheets and then grow organically (hopefully). Their is light at the end of this tunnel.
Feel free to correct me or to fill in some blanks and we'll have a nice picture painted.
Checkmate28
Dr Air RE AISC thanks, immediately after it became standard, you were the first to throw the term around often here, Laggard been around for a long while as well.
When I used those terms, I was giving you credit, as I most often heard those terms from you on this board.
FYI Dundee I looked at the presentation. Impressive AISC
September 30, 2013
Cash and Credit $200M
including:
$150M undrawn revolving credit facility
~$50M in Cash and Short-term
I was especially interested in the PEA for CHELOPECH sulfide as it is similar to GoWest Golds project
CHELOPECH High sulphidation epithermal deposit
Au 6-7 g/t 75,000 - 90,000 oz
http://www.dundeeprecious.com/files/technical_reports/Sept%202012%20Pyrite%20PEA_v001_v553m7.pdf
The analysis is showing an IRR of 103.9% and an increased NPV of $748 M – both at the original discount rate of 7.5% by producing a concentrate and taking that to the Namibia smelter similat to Gowest plan to use the 2 Kidd smelter lines to process their orr.
LSG.v Lakeshore Looking primed after years of pain and not a favorite around here. Up about 50% last 30 days.
http://seekingalpha.com/article/1939111-lake-shore-gold-is-ready-for-take-off-in-2014?source=email_rt_article_readmore_button
They went all in financing their production build outs. Overruns and POG put them in the penalty box, down 90% from the highs. Two producing mines, 7.6 million oz gold and are guiding for 160k to 180k oz production for 2014. In Q4 2013 they produced 51,700 oz gold with AISC around $1,000 and are estimating $950 - $1,050 for 2014. With current CF, the 130 million in debt should be manageable at current POG and they can derisk the balance sheet in short time. Mgt has a ways to go to prove itself but the odds are looking better.
Primero paid $220 million for Brigus a 120,000 ounce producer holding roughly 1.72 million in gold reserves, the company paid approximately $127 per ounce of gold.
If Lake Shore was bought out at $100 per gold ounce, for the 5.6 million oz not including Fenn Gibb, the transaction would imply a value of $560 million and a serious bump from the current EV of $324million.
Right now and esp after the new Mexican royalty, I like the high grade Timmins minors. I think the next 6 months are going to be telling and bring some changes. Rick Rule just did a piece on billions of foreign $ slated for investment in resources. What will the price of gold do and where will the company's level off as to AISC and CF are the million dollar questions?
SAS.v St Andrew Goldfields Looks like I was right on here, calling SAS.v maybe the cheapest producer in the safe Canadian jurisdiction and a laggard.
Could have bought them most anytime Dec for .23 Trading today at .32
Seeking Alpha puts out the Gold Miners Analyst Watch: They keep track of Analyst forecasts collectively for 20+ Gold producers. In Januarys Edition, they added SAS.v and it beat the closest competitor by over 100%. The stock responded today and I couldn't add.
Ended Q3 2013 with AISC of US$1,086/ ounce & $31.6 Million cash
Lot of production upside coming with their High grade Taylor development project.
Borders Brigus gold. Hint hint, Brigus just got bought out along with Aurizon. They are a Timmins turn around story like Brigus and Lakeshore Ive posted on.
AUMN Golden Minerals Large volume 1.4m, and price spike up 32%.
For $30 million market cap, you get:
est $16Mill in cash
130 million oz 43-101 AgEq resource split about equally between both projects below.
Velardeña in Mex, 100% owned, 2 mines, 2 processing facilities. Currently shut down in June due to low silver metal prices. Company line is they are re engineering the mine and taking the opportunity to get rid of the lazy inherited union workers. Will reopen much more efficient when metals rise.
El Quevar in Argentina, 100% owned, pure silver exploration, 55,000-hectare land open east and west.
They have the cash to weather the storm. If AUMN shores up operations during the shutdown and reopens with better efficiency, higher POS, better employees and conserves enough cash, this could be one of the better come back stories.
Not advocating buying this, Im trying to keep tract of companies trading at or below cash and just sharing my recent notes.
Checkmate28
LoneClone GORO .03 was unsustainable but their still paying nearly 2.5%. Operationally GORO is classed an exploration company. The cost of the plant expansion is expensed rather than capitalized. The entire $17 million for the 2013 plant expansion, materials, equipment and labor have been subtracted from GORO's bottom line earnings. Should be more $ for Q4 but the mill expansion is complete. This expansion doubles the mill capacity. The question will be, how fast they can get the mine capacity at par with the mill. 2013 was a tough year, tring to expand with Low price of metals and paying the divy. With the mill complete, 2014 will blow away 2013 operationally. Their only analyst is forecasting .60 in earning for 2014. Care to comment??
Someone here mentioned the book value for GORO as being low. Most companys need to drill off millions of ounces to get the feasibility for the banks. GORO didn't need the NI43101 to get initially financed, and hence, only drilled enough to steer them to the production metals. Only recently they started working on the report. Their low booked 43-101 resource will hold down their book value relative to their peers.
I'm wondering if Hothchild will need to sell any more shares in the future??
Just presenting a little more of the picture.
Checkmate28 Wishing you the best for 2014
LMRMF: Lomiko Metals Incredible in todays market. Up well over 100% Graphite plus 3d printing going to be a winner.
Might look to take advantage of this storm elsewhere.
Dr Airtime, TGZ.t Dont know if you still own it but Thought you might be interested in the insider info. I never took a position but have been watching it. Just did a US$135 million gold stream transaction with Franco-Nevada and the insiders bought after. Positions them with less debt, production growth and liquidity.
http://canadianinsider.com/node/7?ticker=TGZ
Dec 23/13 Dayal, Navin Acq public market 10,000 $0.520
Dec 19/13 Sipos, Katherine Acq public market 25,000 $0.520
Dec 17/13 Savarie,David Roger Acq public market 39,000 $0.520
Dec 17/13 Hill, Alan Richard Acq public market 500,000 $0.520
Sep 25/13 Lattanzi,Christopher Acq public market 40,000 $0.680
JFF7 Thanks for that clarification. I didn't think you would be a buyer at $19 unless I was missing something.
JCC7 RE: CEN.v Im trying to figure out why you bought CEN.v Coastal Energy at $19 in light of the acquisition?
Thanks
AUMN Golden Minerals Trading at cash.