RE:PEA published on SedarI read the report it and here are my thoughts about it:
- With a gold price of 1200 US$, we make money (NPV of 80 M$, IRR of 52%) ; if it goes higher, we make more money.
- The assessment suggest that we are in business even if the GP stays at 1200$ for the entire mine life. I expect the GP to fluctuate, offering other development possibilities.
- There are still more than 300 000 ounces in the inferred category (3g/t cut-off) that could extend the mine life.
All in all, the report shows that the Goldboro deposit offers potential to start collecting the precious metal right away and, by the same time, gives a lot of possibilities to explore and extract the gold we have at a smaller cut-off if the GP rises above 1500$. But we have to be realistic here... we have to forget all the old SP speculations over the dollar mark and think about more realistic scenarios. With the current outstanding shares, if we take the NPV proposed in the report of 80 M$, that gives a SP of about 0.45$. The report suggests that financing could come half from the market (around 12M$ to 15 M$) so it is reasonable to think that we might double our oustanding shares, giving an SP in the 0.20$ - 0.25$ range. At the current SP, it is a 8 bagger.
At the last AGA, Mr. Billings said that he hopes to have the SP around the 10 cents mark before approaching the market for financing. I do not see how this could be realized in these difficult times for juniors. The only option I could think of is playing the card of the job opportunities for the area and get some financing from the Nova-Scotia government. This is a possible scenario since the project requires less than 30 M$ to get started.
We are still far from the first doré bar (lot of studies and reports are still needed), but I am comforted in the path we are taking toward production. Also, there seems to be a concensius over the fact that the past attempts to estimate the gold richness of the deposit are underestimating the quantity of gold we have in the ground. By starting the extraction right away, we might have a more precise idea about the real grade and we could have nice surpises on this side. If you add to this the possibility of having a better price for the bullion and the excellent resource expansion possibilities for the property, this project seems to have some potential... meaning that I am in for the ride.
Please keep in mind that this is my own opinion and always do your onw due diligence before investing. Comments and (positive) critics are welcomed.
GLTA