My guesstimate is based on a couple of things, one of which is this post from a few days back....
In an ealier post on the MOA board, I reconstructed estimates of VL gold resources in 2005 , had the cut-off been lower than the 5 gms/ton that was used in the 2005 43-101 estimate.
The reason for doing so was because the 2005 estimate assumed an u/g mine , whereas now VL will be an open pit mine where grades below 1 gm /ton are typicallly economic.
My starting point was the 359,000 oz at an average grade of 10.87 gms/ton estimated in 2005 , using a 5 gm/ton cut-off and eliminating/capping the nugget effect ( about 500,000 oz with no capping of very high grades ).
Assuming that the ore distribution by grade was approximately the same as that of a normal distribution and assuming that the ratio between 5 gm.s to 4 gms is the same as 4 gms to 3 gms and that between 1 gm and 0.5 gm is the same as that between 2 gms and 1 gm, the revised ( and best estimate ) estimate of the 2005 estimate to include gold in the assays below 5gms/ton cut-off is as follows......
...........359,000 oz at 5gm cutoff with an average grade of 10.8 gms/ton
..........453,000 oz at 4 gm cutoff with an average grade of 8.7 gms/ton
......... 571,000 oz at 3 gm cutoff with an average grade of 7 gms/ton
....... 748,000 oz at 2 gm cutoff with an average grade of 5.3 gms /ton
....... 905,000 oz at 1 gm cutoff with an average grade of 4 gms/ton
.......1,095,000 oz at 0.5 gm cutoff with an average grade of 3.2 gms/ton
Note that in the mettalurgical press release they used a sample of average 4.16 gms/ton which they reported as being typical of the average grade of VL ore.
From the above reconstruction, 4.16 gms/ton would place the 2005 estimate between 748,000 and 905,000 oz or more precisely 870,000 oz. I am fully confident that this is very close to the truth and that the new 43-101 will almost certainly be above 1 million oz ,with 2 million oz being possible if not probable.
The reason I say this is because the distribution of open pit gold grades are usually skewed to the left ,which, at an average grade of 4.16 gms/ton means that there was a hellava lot of ore, less than the 5 gm cut-off which constrained the 2005 estimate......and the 3m blocking would have constrained that estimate even further.
Also, in an earlier post on the MOA board , I estimated the undiluted contained gold within the newly delineated L Pond discovery ( ie including extensional drilling since 2005 ).
My estimate was 1.8 million oz, assuming an average grade of 2.5 gms/ton.
Allowing for a 30 % dilution effect,this estimate would be reduced to about 1.25 million oz............conservative in my opinion.
These estimates gives me confidence that the partially delineated gold deposit at VL will hold more than 1 milion oz when it is announced in the near future.
Inferred gold resources in the ground and with reasonable expectations of being economic are currently being valued at about $100 per oz.
V Lake's L Pond will have a substantial amount of its new 43-101 in the higher M & I categories which are valued at about $150-$200 per oz.
To be conservative , assume that just 20 % are in the M & I cats which will boost the valuation to about $125 per oz..
MAR's 50 % would then be worth about $78 million or about $4.25 per share and MOA's will be worth about $2.
How the market responds to the new estimate cannot be entirely predicted.
However, my calculations of residual grade at the 1 gm/ton cut=off are very close to that reported now for the integrated deposit ....over 4 gms/ton.
If this anywhere correct, it would mean that the open pit grade would be much higher than that of the average open pit which is generally below 2 gms/ton.
High grades means lower cash costs and lower cash costs provide a premium valuation multiple.
Should the 43-101 be followed by a positive PEA, then the valuation will increase to the $200 to $300 per oz of contained gold range..........which would double the valuations estimated above..