GBBJust picked up some more at
.38 since can't resist these deals.
$62 million for 3 million ounces of gold is less than $21/oz for the best mining jurisdiction in the world.
I couldn't agree more with Montreal that they are just securing the Adanac property for an eventual take-over of GBB after the 43-101 rather than buy-out GBB and have to purchase THG above the fair market price when it's getting bid up due to the area play effect of GBB come the Resource Estimate.
With the pending 43-101 and the attention it should bring I'm more worried about being taken over at a 35-50% premium for our shares at these prices and only get
.55 cents than losing money on this investment.
No one mentioned Osisko in 2005 and 2006 when they were adding ounces at Malartic 60 kilometres to the east of us since the drills were coming back medium to low grade and investors were under the impression it wouldn't make a mine.
Since then Osisko is pouring gold and has become a 600,000 oz per annum producer with the second largest gold reserves in Canada between other projects and some of the lowest cash costs at $350~ / oz.
Osisko went from a market capitalization of $100 million to $5 billion in 5 years or a 5000% return on initial investment by simply proving up more and more gold at their Malartic deposit as well as picking up some key assets along the way.
Last year with gold at $1200 dollars an ounce Osisko swooped in and picked up Brett Resources as well as their Hammond Reef Property for $380 million dollars CAD once Brett released a new 43-101 showing 6.5 + million ounces of gold at 0.7 g/t au.
Brett was given a $58 / oz price on their gold ounces or at the time a value of gold ounces at 4.85% of the gold price at the time.
Using this same formula for GBB (which has similar grades to Brett and better gold recovery) GBB is getting $21/ oz currently or a value on their gold ounces of 1.4% of the current gold price based on 3 million ounces of gold.
I have no doubts in my mind that the Granada property will be a 5- 7 + million ounce deposit within the 18 months with the tonnage GBB has drilled and plans to drill over the next year and a half. My only concern is that by the time Granada has shown the potential for 3 - 4 million ounces we'll be handing the reigns over to Osisko to drill up and turn Granada into a mine as our market capitalization at these prices is far too low to pass up for majors.
The only missing piece to the puzzle is a 43-101 which Osisko and other majors need if they want happy shareholders in the event of a takeover as it will place a bankable value on our ounces in the ground.
Richfield was trading at $1.00 last summer and no one was interested in their Blackwater Deposit despite the continous encouraging drill results. Less than a year later they have been purchased by NGD for $125 / oz just after their 43-101 release showing roughly 4 million ounces of gold.
Right now we're trading at 20% of the Richfield takeover, 30% of the Brett takeover and the only difference is a lack of a 43-101 report measuring our resource.
Plus you're getting a dividend on your shares for your portion of a Castle Silver Mine spin-off expected at the end of the summer.
I agree there are more safe plays out there like emerging producers in the gold space but GBB below 40 cents is about the best value I can find on the Venture especially with gold still trading just 5% off of record highs.