RE: Honest Questions Riff,
Been lurking here quite a while and just signed up for bullboards so i can post. I follow gold but only know the basics. Thanks to everyone who has posted regularly.
I own OLE but sold some off around 1.12 after reading that some analysts discount gold in the ground in higher geopolitical risk areas as low as $25 an ounce. That would put the market cap at 137.5 million and mean OLE is fairly valued right now even in a buyout. I guess the question is, can they get more than $25 an ounce, and will the resource really be 5.5 M ozs or greater?
I think the other reason the stock isn't headed upwards is the cost of capital to build the mine. From what I read it could be as much as $300 million to build the mine, and capital is fairly difficult to come by right now. I understand Teranga could buy OLE and use their own infrastructure to extract the gold, but if they are the only company nearby, there may be zero competition to buy OLE. In that case, Teranga may buy it for a steal.
I'm sure the regulars on here have already thought this through and made their decisions. I would appreciate hearing other's thoughts on it. I'm trying to decide whether to sell the rest of my OLE and find other gold stocks in lower risk areas to invest in.