Company Highlights... For those that are not familar with the story, Brigus has two exploration projects on the go, which I would like to add are in very close proximity to their Flagship, Black Fox Mine namely the Contact Zone and the recently discovered 147 Zone. Combined they have an NI 43-101 Resource Estimate of Indicated Resource of 116,710 ounces and Inferred Resources of 459,420 ounces...a combined total of 576,130 ounces. They are in early stage exploration and the possibility of expanding existing resources is very high!
A Preliminary Economic Assessment is due in the Third Quarter of 2012 and we could see a "bulk sample" from the Contact Zone as soon as mid 2013...they will gain access via an existing Portal & Ramp System...Nice!
The Underground Resource at the Black Fox Mine has not been fully dilineated and it is open "down plunge" and to depth. They recently began an aggressive drilling program using an exploration drift as a platform...the nice thing about this deposit is that the grade is increasing with depth...positive drilling results should move the stock!
As for Cash Costs...their target is $700.00 per ounce by the end of 2012...a reduction of $158.00 per ounce....that will go right to the bottom line! I believe they can achieve this target due to the fact that the majority of the developments costs are behind them and they will have access to 30 Stopes by the end of the third quarter.
Mill Expansion: Projected completion is July 2012...the expansion should increase throughput by 5-10%...presently they are milling about 2,000 tonnes per day...if they can get to the high end that would put them at 2,200 tonnes per day. Do a little math...200 tonnes per day X 3.66 g/t (average)...732 grams divided by 31g (troy ounce)...23.61 ounces.
Additional gold produced per quarter....23.61 ounces X 90 days...2,125 ounces....Nice Again! Another reason to buy!
Gold recovery in regards to the Milling Process is 96%...this is most excellent!
They have a Gold Stream Contract with Sandstorm Gold which involves 12% of all production at the Black Fox MIne...under the current terms they must sell Sandstorm the gold involved at a price of $500.00 per ounce....yes it is a negative...they are losing money selling it to them but we must remember that they received 56.3 million dollars upfront under the terms.
There is a positive here...they can buy back up to 6% of the gold stream, they have up to the end of 2012 to do so! The price tag is 36.6 million dollars.
We know for a fact that they will most definitely buy back 1% before the end of 2012...they received 6 million dollars for their Calais Notes and will use the money which will be in their hands by the end of August 2012. As for the other 5% they are looking into non-dilutive ways to come up with the remaining 30.6 million dollars...Nice!
Doing away with 6% of the 12% will be very positive and will go directly to the bottom line!
Enough for now...as you can see Execution is the Key!
I am really impressed with their progress thus far and if it continues I will be holding tight!
This has the making of a fantastic turn around story...a double or triple is in the making!
Digger144
P.S. Have most wonderful, safe and enjoyable holiday weekend!