GOLD at $1,200 for the forward contract and BZA atCan anyone here explain why the forward contracts for gold just hit $1,202 just a few minutes ago and BZA is 18 cents.
With a purported 330,000 ounces of mineable reserves and a recovery of 90%, that should produce 300,000 ounces recoverable. Even at $500 per ounce cash cost and the Independent Engineers unwilling to go beyond $800 per ounce for gold going forward 7 or 8 years, this would give a pre-tax of about $90,000,000 05 70 cents per share before dilution. At a CAPEX of say $40 Million, with 8 year payback at 10% money, the NPV should be $12 Million.
Ooops I think I found the problem. $12 Million divided by 118,000,000 shares is around 9 cents, so BZA is currently trading around double what the Feasibility study will show. The Feasibility will be stuck at $800 gold in its calculations.
Could this be the high mark in the BZA trading range, History says sell on mystery as the news always takes down the price.
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