a bit of backgroundI am a mining speculator from Perth Western Australia which probably has more mining speculators per square mile than most of the world and also home to many gold miners. The Canadian market does not yet appreciate what AGB is doing.
I heard one analyst at the conference call talking about the "modest" resource size of the deposits A"modest " 500,000 ounce deposit with operating costs of $US600 is worth about as much as a 1.2 million ounce deposit costing $1000 to produce on a NPV basis and its less risky.
Pretty well every successful mining company begins life with one high margin mine like AGB
Secondly the market has not twigged to the clues Steven Dean is giving about the exploration upside. When this project was listed on the ASX I remember one of the Aussie directors, probably Wally Bucknell, comparing Nova Scotia to the WA goldfields in the late 1980's to 1990's, a time of significant exploration success, big exploration budgets and lots of excitement for punters.
The reason for the comparison is that Nova Scotia is clearly well endowed with gold but there hass been no serious effort to use modern exploration techniques and understanding to develop the potential. That is what AGB is doing. The focus on just mining quartz narrow vein in Nova Scotia esp Saddle reef systems has not been a great success. here in Australai when saddle reef systems are mentioned punters run for the hills due to consistent failure of geological models based on these systems
The concept of constructing a plant for $100 million to work say a 500,000 ounce low strip pit and then moving that plant to the next pit is a very smart allocation of capital.
We just have to find two more 500,000 ounce pits and we are talking $4 to $5 at current gold prices and $6 to $8 at gold prices north of US$1800.
Sit back and relax for a few years and enjoy the ride