@shanplus43 Has Novo turned the Corner?
The last 12 months has been one of the brutal periods for the Novo longs. Despite several factors going their way as below
a. acquisition and successful restarting of operations.
b. Marginally Profitable though grade has been below par
c. Covid induced constraints of labour and spares.
What do I see for 2022?
a. Grade controls leading to much higher gold production definitely by H2 of 2022. We should average 2.5 gpt leading to cash flows of atleast 50M USD (net of exploration expenses) for 2022. This is a reasonably conservative estimating assuming H1 is similar to this year.
b. Ore sorter should give us 10,000 Oz and another 10M USD comfortably.
c. I expect atleast one project acquisition (outside the pilbaras and even Australia) by 2022 end. QH is an awesome geologist and Novo with its cash flows will start acquiring projects, do some geologic modelling and drilling to build a resource model. Whether they sell the project or develop on their own would be dependent on skills and people availability, but at the very least, they can sell these projects for a tidy sum + royalty.
So plenty of reasons to believe that the worst is behind us. Maybe another few weeks to endure for the tax-loss selling and even that may not necessarily be the case for us. But the brightest star for Novo for 2022 could well turn out to be the gold price. I think once this taper illusion is reversed and its only a matter of time, then we should gold easily go past 2200.