RE: Frasermackenzie - Strong Buy
Here is the summary for those that did not open the link:
The total resource inventory of just over 5 million ounces gold is exactly in line with our expectations however the overall average grade was approximately 15% lower than both the previous resource and our expectations.
We were very pleased that such large proportion of the total ounces, (81%) fell into the Indicated category, speaking to the excellent work performed by the company in infilling the immediate resource areas.
We also note the headline resource is stated at a 0.4 g/tonne cut-off. The resource at a 0.6 g/tonne cut-off still contains almost 4.4 million ounces of gold at around 1.25 g/tonne. This level of resources is only 12% shy of the total contained gold ounces relative to our expectations but it meets our expectations with respect to grade.
Overall we view the update as very positive in that the confidence interval of the resources, the total contained ounces, and the robustness of the indicated resource at a 0.6 g/tonne cut-off, all point to a potentially economic open pit containing at least 5 million high quality, minable ounces of gold.