Argonaut Gold Inc T.AR

RE:RE:The potential for PROFIT at Magino

[Wolverine2024]

Lifexprt - you said "...hedges, all production from Magino is sold at $1,860"

No it's not, the point is the hedges have very little impact on the profitability of Magino. Yet you are trying to present it as if 100% of the gold produced at Magino ("all production from Magino") will be sold at $1,860 (till 2041). If you do the numbers, it's apparent that the hedges have minimal impact on Magino's profitability as of Q1 2025.

But so that we are all on the same page here are the HEDGES for Magino. From TORONTO, Oct. 27, 2022 /CNW/ -Argonaut Gold Inc (TSX: AR) (the "Company", "Argonaut Gold" ...

• Argonaut has hedged 25,000 gold ounces per quarter for the six quarters starting in the third quarter 2023 at a gold price of US$1,860/oz
• and 15,000 gold ounces per quarter for the 10 quarters starting in the first quarter 2025 at a gold price of US$1,860/oz.

• In addition, the Company has hedged 10,000 gold ounces per quarter for the 10 quarters starting the first quarter 2025 at a gold price of US$1,763/oz.  

Here are the numbers with hedges and for comparison without hedges. 

If gold were to drop to $2,000/oz, the hedges would eat up only 2.16% of profit.
If gold were to rise to $2,700/oz, the hedges would still eat up only 6.0% of profits at Magino. 
This means (using $2,700/oz) that the profit at Magino would be USD $346Mil with hedges as opposed to USD$368Mil if there were no hedges. That's mathematically insignificant and a far cry from your comment that "all production from Magino is sold at $1,860"

Here is a table below of the range of profit based on $ of gold considering both Hedges and what it would be without hedges for comparison. Assuming 230,000 oz of gold produced per year at the cost of $1,100/oz  on 17,500 tpd as per RY




The point here is that there are reasons being thrown around, mostly doom and gloom, greatly undervaluing Magino. I want to address these issues and expose those that are (heavily) exaggerated so we can look at this deal objectively. 
Please run the numbers for hedges and without hedges for yourselves, if you find errors please advise.

And I agree, we need to discuss grades, TPD, Mill throughput etc etc in subsequent posts

btw, I made a mistake, regarding Magino and FC, I meant to say why are they "splitting", instead I wrote "selling". My bad.