Updated PEA for Adumbi ..V Lake ProxyYou can view my initial PEA estimate which was posted several weeks ago, based on my own presumptive cost estimates.
I earlier used Valintine Lake gold deposit as a proxy for LN's market cap , as they are advanced stage gold deposits with open pit mining and gold resources are about the same.
In this case I used POG of $1500 US..all other currency is in C$.
Fortunately, a PEA has been done for Valetine Lake..see link below.
The Advantage of Adumbi over V Lake is in the average grade.
This is easily evidenced by the fact that the same capex needed for 3 m tons per year plant will recover 3.4 m ounces at Adumbi versus 1.9 m ounces over the same LOM of 13 years.
As is seem in the Table below, the discounted after tax NPV5 of $1.49 b CAD for Adumbi is over twice that of V Lake.
V Lake Trades at 70 % of its NPV 5.
Adumbi would trade at $8 at 70 % of its NPV5.
Adumbi has massive upsides besides the Adumbi open pit deposit.
Why would ABX continue to spend exploration money outside Imboe , to make LN even more expensive, especially as they have the first right of refusal for ..in my opinion ...the crown jewel Makapela
https://marathon-gold.com/site/uploads/2021/03/3-29-2021-Marathon-Announces-Valentine-Feasibility-Study-vFinal.pdf | | | | | | | |
| | | Valentine Lake | | Adumbi | | |
| | | | | | | |
| POD ( USD ) | | $1500.00 | | $1500.00 | | |
| Ore Mined | | 3 m tons | | 3 m tons | | |
| LOM ( Yrs) | | 13 | | 13 | | |
| Grade | | 1.34 | | 2.51 | | |
| Capex ( C$) | | $780m | | $780m | | |
| recovery % | | 94.2 | | 97.0 | | |
| average Gold Production | | 146,000 | | 235,000 | | |
| Gold Recovered | | 1.93m oz | | 3.38 m oz | | |
| AISC ( $C) | | $1050.00 | | $875.00 | | |
| USD/C$ Exchange | | 0.75 | | 0.75 | | |
| Tax rate | | 30% | | 30% | | |
| Pretax Cash flow( C$ ) | | $1.386 m | | $3.05 b | | |
| Aftertax Cash flow ( C$) | | $973m | | $2.15 b | | |
| PreTax NPV5( C$) | | $867 m | | $1.91 b | | |
| Aftertax NPV5 ( C$) | | $600 m | | $1.49 b | | |
| | | | | | | |