New update at www.goldsilverdata.comPretium Resources (a new company that purchased their properties from Silver Standard) has a lot of upside potential. The have 60 million oz of gold and 250 million oz of silver at their Brucejack and Snowfield properties in Canada, although most of it is very low grade. They have excellent production growth potential long term, and they have one of the best management teams in the industry. I also like their strategy. They are going to mine the high grade Bruce Jack property first (planned for 2016). Then they will attempt to grow the company.
The VOK (Valley of Kings) and West Zone deposits have a feasibility study completed. The capex is $650 million, with projected all-in costs of only $500 per oz. Production is expected to be 400,000 oz the first 10 years. The low costs come from both the high grade and silver offsets. However, there is currently an issue with their grade. The stock has dropped from $10 to $3.25 in the past month because of the uncertainty regarding the grade. Below are two links that explain this situation.
https://www.mineweb.com/mineweb/content/en/mineweb-gold-analysis?oid=210245&sn=Detail
https://www.pretivm.com/news/news-details/2013/Pretium-Resources-Inc-First-Bulk-Sample-Cross-Cut-Processing-Results/default.aspx
We will not know the fallout of the bulk sampling until Q1 2014, when they release an updated resource estimate. To value the stock, I have reduced the grade from 14 gpt to 10 gpt, annual production from 400,000 oz to 300,000 oz, and increased the all-in costs from $500 to $1000 per oz. Even with these lower numbers, it seems like a solid project. Unless the grade is much lower than the original 43-101 resources estimate, I still expect this project to get built.
Note: There have been several class-action lawsuits initiated regarding the grade issue.