Didipio-related excerpt from the OGC.to recommendation:
The company and its future:
OceanaGold is a long term stable producer in New Zealand. That is supported by 10-12 years of M&I resources + a further 6-8 years of inferred resources, only counting the NZ mine sites. The company aims to keep 7-8 years of these resources as P&P reserves, a number that is currently 6 years but expected to grow within the target by the end of 2010. OceanaGold will probably run the Macraes Mill for at least another 15 years but we do not expect the production rate to grow from the current pace of 280,000 to 300,000 ounces. The Didipio project will soon see an updated feasibility study which we think will be followed by a sale to Korean or Chinese interests by the end of the year. The gold/copper project should be seen as a long term 110k ounce producer at cash cost of below 200 usd/ounce after by product credits. We think that one of the main options regarding Didipio is to sell it, and see 150 musd as a rather conservative estimate, something that would obviously be very pleasant for the shareholders. The other alternative, restarting development would on the other hand reinstate OceanaGold as a growth company and put them on track for 400k ounces with falling cash costs as soon as 2012-2013 something the market would obviously see as positive too. All in all, this makes Didipio a key trigger for a higher valuation the coming 6 months.
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