Portion from the April 28/14, Gold Report ..
..... TL: I'd like to highlight two companies operating in Quebec: Metanor Resources Inc. (MTO:TSX.V) and Integra Gold Corp. (ICG:TSX.V). Those companies had a very interesting Q1/14. They have more than doubled—but then lost, once again, 40% since mid-March. ...... Metanor Resources is producing gold at a rate of 50,000 oz (50 Koz)/year at an all-in cost that is probably lower than $1,000/oz. Further exploration work at the Bachelor Lake mine, where the company is producing its gold, has indicated its main vein is continuing at depth. This will bode well for future resource expansions, which will extend the mine life at Bachelor Lake. ........ Metanor is trading way too cheaply at a market cap of $42 million ($42M). It is producing profitably. It's an interesting company. It's had its fair share of bad luck in the past, but it's on track again. ........... TGR: Bachelor Lake reached commercial production. What's the next catalyst? ............ TL: Its financial results from Q1/14. That was the first quarter that the mine was in commercial production and the first quarter where Metanor can prove to the market that it's a profitable mining company. .......... TGR: And Integra? .......... TL: Integra also made tremendous progress in Q1/14, as it released another resource estimate and a preliminary economic assessment (PEA). .......... The new resource estimate contains more than 800 Koz gold at an average grade of more than 10 grams per ton. The PEA was quite excellent. Using a gold price of $1,275/oz, the internal rate of return was a little more than 50%. ........ It was mainly the result of low initial capital expenditures, which were $50–65M. On top of that, the all-in sustaining cash cost was about $750/oz. It's a highly profitable and high-margin project. ........... Furthermore, the PEA just took a part of the new resource estimate into consideration. It's likely that further exploration will result in a longer mine life and a higher net-present value (NPV). ........... TGR: Integra has a reasonably young management team. Should that be cause for concern? .......... TL: Young, perhaps, but not inexperienced. CEO Steve de Jong has assembled a good team on the ground. Vice President of Exploration Hervé Thiboutot has several decades of experience under his belt, including time at Alamos Gold Inc. (AGI:TSX).