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Tuesday, 09/09/2014 11:45:59 AM

Tuesday, September 09, 2014 11:45:59 AM

Post# of 2531
Here's why I think Midway Gold could outperform its peers in 2014:

*Pan: A Low-Cost Mine in Production in 2014

For a mining company's first mine, the Pan mine is as good as it gets.

- The Pan project, with a gold resource of 1.13 million gold ounces, is fully permitted and construction is underway with completion estimated for Q3 2014.

- Average annual production will be 81,000 ounces at fully-loaded all-in costs of just $824 an ounce. This would put the mine among the lowest all-in cost mines in the industry.

- The Pan project is a low cost, Carlin-style gold deposit mineable by shallow open pit methods and treatable by heap leaching, according to the company.

- A feasibility study was completed in November 2011. It shows the project is economical at a range of gold prices, with a Net Present Value (NPV) ranging from $123 million at $1,200/oz gold to $344 million at $1,900/oz gold. The IRR grows from 32% to 79% using the same gold price range (Both are after-tax figures).

- At $1,200 gold, payback is just 2.6 years. However, at $1,550 gold, payback is just 1.7 years and at $1,900 gold, payback is 1.2 years. Therefore, the project is highly leveraged to an increase in the price of gold.

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