Webinar Replay and Notes Webinar replay link: [url=https://event.on24.com/eventRegistration/console/EventConsoleApollo.jsp?&eventid=3796124&sessionid=1&username=&partnerref=&format=fhvideo1&mobile=&flashsupportedmobiledevice=&helpcenter=&key=0183C463148A1B89747F2D879B08A925&newConsole=true&nxChe=true&newTabCon=true&consoleEarEventConsole=false&text_language_id=en&playerwidth=748&playerheight=526&eventuserid=546617177&contenttype=A&mediametricsessionid=471278040&mediametricid=5338607&usercd=546617177&mode=launch]https://event.on24.com/eventRegistration/console/EventConsoleApollo.jsp?&eventid=3796124&sessionid=1&username=&partnerref=&format=fhvideo1&mobile=&flashsupportedmobiledevice=&helpcenter=&key=0183C463148A1B89747F2D879B08A925&newConsole=true&nxChe=true&newTabCon=true&consoleEarEventConsole=false&text_language_id=en&playerwidth=748&playerheight=526&eventuserid=546617177&contenttype=A&mediametricsessionid=471278040&mediametricid=5338607&usercd=546617177&mode=launch[/url]
The reason to consider investing in SGO is based on the:
- People
- Project
- Cap Structure
- Ability to Raise project financing
The flagship Cerro Caliche project is surrounded by multiple other open pit / heap leach mines and deposits. SGO is bringing Cerro Caliche into production with a 8000tpd heap leach operation which will allow for continued exploration expansion. Ken Macleod believes there is AT LEAST 2M oz of gold on the property and to increase the resource to 1M oz they estimate would require $3M budget for drilling which will be generated from operation cash flows starting in 2023.
Management expect that the updated resource estimate will be completed in August and disclosed to the public end of August/early September. From there a technical report will be completed within 45 days, management anticipates having an updated PEA released mid-October. Environmental permits should be received by this time as well.
SGO is in advanced discussions with 1 primary financing party, but have had negotiations with others as well. This main project lender is happy to finance with just an updated PEA, but SGO has done everything to do a PFS if needed. A PEA is obviously much cheaper and quicker to complete. SGO anticipates Q3/Q4 for an EPC (Engineering, Procurement & Construction) contract to be completed.
So catalysts & timeline to production follows something like this:
- updated resource estimate – Q3
- Environmental Permits – Q3
- Updated PEA – Early Q4
- Secure project financing – Early Q4
- Mine Constructure – Q4 to mid 2023
- Gold Mining / Production – H2 2023
SGO has a great insider base through-out Canada, USA, Europe, UK, and Asia. Insiders continue to buy in the open market and from the financing. There are no cheap stock. Insiders average is around 19-20 cent per share. There is no free ride from the management team, they believe in the project and are putting their own money back into the company as they expect a very nice ROI. John Darch owns over 6M shares and Ken Macleod owns over 9M.
The current PEA has an after-tax IRR of 45.6%. As the resource increases, the life of mine will also increase which will have an even further positive effect on the IRR, cash costs, etc. (the current PEA is here: https://sonorogold.com/archives/news/sonoro-files-updated-preliminary-economic-assessment-on-sedar ). Ken and John discuss how they can reduce CAPEX to positively affect this IRR even further.
At about the 50min mark, one of the viewers submitted some back-of-the-napkin math on what they felt the share price target could be relatively soon.
The webinar was great to attend. SGO has a market cap of just $18.8M and gearing up to secure project financing, start mine construction, and be in production by end of next year. There is a lot of upside ahead from a company standpoint, but I also strongly believe precious metals are going to run hard over the next 2-3 years with looming serious recession.