Fortitude Gold Corp FTCO

Research article on ECD property

[goldpoet]

IR sent this excellent reseach article on their East Camp Douglas property to shareholders today:

https://metallic.media/fortitude-gold-east-camp-douglas/

The article speaks for itself, FTCO has an outstanding property to explore and develop at ECD.  Legal theft.  Their most recent acquisitions also appear to be steals:  Dauntless is a past producing mine, and Intrepid, while more speculative, is 4x closer to their IP processing plant.  Thus, they plan to start drilling Intrepid first.  Management has repeatedly emphaiszed that the market is not realizing how valuable IP continues to be even through the Pearl is almost mined out.  Developing open pits within trucking distance of thier IP processing center will allow them to remain profitable with a secure dividend, and fund exploration for potential game changing reserves and/or a signicant increase from the 40k/oz/y production profile projected for the next few years (once permitting allows them to resume mining).

County Line, Scarlet, Golden Mile, and potentially Intrepid, with ore processed relatively cheaply at the nearby IP facility, could buy them time to explore and develop their other properties, especially ECD and Dauntless (in addition to attempts to replinish mined ore at IP, CL, and GM, thereby keeping mine life a constant).   A high gold price may allow them to do all this without shareholder dilution even though the grade from these deposits may only be 1/3 that of the Pearl deposit, basically 1g+.   

The inexplicable delays in permitting the uncomplicated mining of the deeper Pearl benches and CL is of course concerning.  As BamBam pointed out, FTCO is no longer producing enough ore to meet expenses, so their $48.7 million Treasury to begin 2024 may deplete quickly.  We'll learn soon enough if they can persevere yet another quarter without the permits to resume mining, without having to cut expenses such as decreasing the dividend.

Be that as it may, I expect a significant re-rating of this stock once the IP and CL permits are granted.  All their drill results for the past year have beat expectations, uncanny.   And I expect another re-rating once the GM permit is granted.  When FTCO has a 4-7 year mine life, with cash flowing profits to explore their remarkable properties, I believe speculative value will be unlocked.  In a continuing gold bull market, that value might be quite a surprise relative to the doldrums the gold mining sector is currently manifesting.

Until the permits drop, all we can expect is blood, sweat, and tears, or expressed more succinctly, fortitude.

Good luck to all longs,

Poet

[skys1]

THe East Camp Douglas property might have great prospects, but if they can't get a permit to mine it, it has no value.