One Analsysts Comments... Most projects like this are not heap leachable, so, in our view, Volcan hasn't been knocked out, it's just reverted to being more like most low-grade bulk-tonnage projects with sulfide ore and economics to prove. As a leach-only operation, a lot of gold was going to be left in the tailings (not recovered) anyway, so, while adding milling to the mine plan would substantially increase the CapEx, it could actually increase the overall recovery to the point of increasing the Net Present Value of the project.
If you think that management will be able to pull this one out of the ditch, today's sell-off could actually be a great buying opportunity. Per ounce of gold, Volcan just went on the deep, deep discount rack. And a good stink bid might net these ounces even cheaper. On the other hand, it will take a while for management to show that one of the new approaches will work, and gold remains vulnerable in the short term, so there might be even better buying opportunities for those so inclined ahead.
So we're changing our formal recommendation to a Hold. We realize that we risk getting out at a relatively better price while we can, but we don't think this is the end of the Volcan project, and management does plan to produce a preliminary economic assessment this year, so we're not willing to realize the loss. The most daring among us might even profit from treating this event as a buying opportunity, but that's pretty risky, so we're not going to recommend it either. We're holding.