Btrevorb Detour doesn’t have a mill yet and are trading over 30 dollars a share and borrowed 300 million for development, lets see now would I buy Detour for 30, dollars a share or MTO at 42 cents , this is a no brainer buy MTO as they are in the process to prove up more ounces and develop Bachelor as well. Yes that is a good comparison with Blue sky potential here at MTO. This is what Jnr explorers are all about buy low and sell High .
I agree that Metanor should be streets ahead of its present price – irrespective of investment to bring Bachelor to a fully operational mine. However, for comparison purposes, the following ought to be noted:-
- Detour already has 17.7m M&I ounces, however the pre feasibility cap cost is $992m (of which $300m + committed) (see pre feasibility highlights as footnote).
- Detour has only 88m diluted shares issued – therefore sp comparison (for same number of shares) should be 42 cents to $18 (30 x 88/144). Still, MTO seems very undervalued – even with Metanor’s ~ 1m ounces M&I, which comes with a mill and high grade at Bachelor.
Based on the mine information, with 10% of Detour’s PF capital requirements, Metanor could be producing at capacity way before Detour (and contributing with production credits). This assumes that all the Bachelor defects highlighted by btrevb would be rectified with cost effective capital spend.
With the benefit of the mine assets and M&I ore reserves then Metanor should be ready to roll - the question has to be asked why Metanor is valued as if it has the plague. In my view, the question is ………….
MANAGEMENT
- Detour was created by the pro active world class HDI Management Group. If they and their partners required $1b finance – no problems – they would effectively manage funds to develop theirs and their investors interests.
- In contrast, it was mentioned that Sprott was a major investor in Metanor. However, Sprott does not get actively involved in Junior company management. He wins more than he loses on his investments, but he will not waste time or more money on managers who do not perform to promises. In effect, he is a silent backer.
There are doubts about Metanor’s Management strengths that give rise to more questions than answers, which could be a reason why Metanor could be prejudiced in raising capital, as and when required:-
The following is extracted from my 21 November message:-
Source : Company information
Serge Roy - Chairman, President, Chief Executive Officer & Director
Before founding Metanor Mr. Roy was President of Ressources Pyrinor inc. He is a residential and commercial construction contractor. Previously he held various positions with companies such as Construction G.P.M., Stabell Resources Inc. and Ovaltex Consultant inc. (mining consultants and geological engineers). Mr. Roy holds a construction contractor's licence from the Commission de la Construction du Quebec.
Source: Northern Miner 6 May 2007.
Metanor consultant Ghislain Morin was recovering from two heart attacks in 2001 when opportunity literally knocked at his front door. Metanor president Serge Roy was doing the knocking with a geologist’s report for the 4.3-sq.-km Dubuisson gold property in his other hand. “My wife was not too pleased — she wanted me to rest,” Morin says. Roy, a commercial contractor who had worked in mining, was lacking the financial contacts and had been told Morin, who has a passion for mining and is well-known in Val d’Or, would be the ideal business partner.
In addition, I now add the following:-
VAL D'OR, Quebec -- Mr. Ghislain Morin has notified the Company, yesterday, that he resigned, with regret and for personal reasons, from the Board of Directors of Metanor Resources Inc. (TSX Venture Exchange: MTO). His resignation was effective immediatly [sic] (on December 12, 2005).
Mr. Serge Roy, president of the Board of Directors, commented " I wanted to personally thank Mr. Morin for his engaged contribution as member of the Board of Directors. I understand and accept his decision ".
The Company intends to replace, during the next weeks, Mr. Morin on the Board of Directors.
QUESTIONS:-
- Ghislain Morin seems to have had a very experienced mining engineering background. Therefore, why did he resign as a director in 2005, “for personal reasons”. This could be understood if his resignation was that he required less stress, as a result of his reported heart attacks in 2001. However, he continues as COO, a position of executive responsibilities where one would expect stress levels to be high, but does not appear to have been reappointed as a director. Is there some reason why he has not been reappointed as a director? Also the Metanor site also shows that he holds the office of President of the company. The Metanor site also shows Serge Roy as President at the same time as Ghislain Morin – can a company have more than one President in accordance with Canadian company bylaws?
- The CEO is a residential and commercial contractor. Since this is not the experience and qualifications normally held by a gold exploration and mining company CEO, then could this be a reason why the Metanor sp is at a discount due to the unconventional background of the CEO.
In summary, Management have an obligation to shareholders to ensure that the company’s interest are put above their own and if a change in management is required at this stage of the company’s development, then the company interests should be paramount.
DETOUR POSITIVE FEASIBILITY STUDY
• Proven and probable open pit reserves of 11.4 million ounces contained gold with a waste to ore ratio of 3.3 to 1
• Global measured and indicated mineral resources of 17.7 million ounces (inclusive of mineral reserves) and 3.4 million ounces in the inferred category
• 16 years life of mine (LOM) at mill throughput of 55,000-61,000 tonnes per day (tpd)
• Average annual gold production of approximately 650,000 ounces
• Average LOM cash operating costs of US$437/oz; US$454/oz with royalty
• At US$1,200/oz, pre-tax NPV of US$3.2 billion at a 5% discount rate generating an IRR of 30.7%
• At US$850/oz, pre-tax NPV of US$1.0 billion at a 5% discount rate generating an IRR of 14.4%
• Estimated start up capital costs of US$992 million
• Additional opportunities to be realized
Source: