RE:Not selling snake oil, just my perspective.Hello Wolfofnoobst,
I understand that your approach is serious. I will try to do the same.
Both the state of reserves and resources have indeed improved since the arrival of Team Callow. AGG's financial environment is tough and Mr. Callow is doing everything possible.
I believe that the current value of AGG is based on fears of new financing to continue its operations and the inability to finance the exploitation of this deposit. Therefore, the only option remaining is the full buyout of AGG or its Kobada license.
Regarding the total value that the market gives to AGG, I don't find the situation all that abnormal. There are many uncertainties about the future of AGG and this uncertainty is represented by a discount on the stock price.
Considering 1,000,000 ounces of gold in reserve, I understand the reasoning of some investors who see it as a godsend. Unfortunately, I consider that this reasoning is not adequate when the facilities to exploit these reserves are not present. Without a factory, one should absolutely avoid considering the profits that might be made and focusing on the value of the permit as if it were for sale.
To establish the value of the Kobada permit, there is no well-defined rule. If this permit were located in Canada, the value of Kobada would be different. If gold were at $ 3,000 an ounce, Kobada's value would be different. If the gold grade were twice as high, this million ounce would be contained in half the ore to be processed and the value of Kobada would be different ... In short, there are many parameters that can influence.
Without wanting to name it, my favorite gold company has an average drilling cost of $ 18 for every ounce of gold in reserve. I don't mean to imply that AGG has a value of $ 18,000,000 (1,000,000 x $ 18) but I believe this parameter is important and should be considered in the equation.
My opinion of the value of AGG is that I am very reluctant to assign a value greater than $ 25 for every ounce of gold in reserve. Do not get excited, it is only my opinion which is the consequence of my interpretation of the context ... Considering that there are 150,000,000 shares outstanding and more than 50,000,000 options, a value so between 11 and 16 cents, I considers that the situation is not so abnormal.
Hope this will help you in your thinking.