Reunion Gold Corp V.RGD

RE:Drilling Results

[CanInvestor1955]

the results were exceptional. Here is the Sprott report dated Feb 24 2023

Ticker: RGD CN Market cap: C$329m REC. (unc): BUY

Est. cash: C$49m Price: C$0.33/sh TARGET (unc): C$0.75/sh

Project: Oko West Country: Guyana

RISK RATING (unc): SPECULATIVE

24 February 2023

  G Mining Services selected to lead the Oko West PEA on the back of the maiden resource (also G Mining) is very positive in our view, as G Mining Services is a tier one EPC firm, with relevant experience on the likes of Fruta del Norte in Ecuador (Lundin Gold, re-engineering and construction) and Essakane in Burkina Faso (Iamgold, DFS and construction). More importantly, they have a successful track record in the Guiana Shield designing, building and/or operating such mines as the Omai Gold Mine and Omai Bauxite in Guyana, and Merian in Suriname (Newmont, DFS, optimization and construction)—complimenting the already strong ‘in country’ knowledge of RGD management. As such, we maintain our BUY rating and our C$0.75/sh PT based 0.4xNAV5%-1850 for a 2Moz @ 2g/t inventory and >200koz pa, plus a nominal 2.5Moz outside inventory @ US$70/oz.

Whilst the lawsuit filed by Barrick ‘muddies’ the waters in the near term, it has no material impact on the Oko West in our view as this was excluded from the 50-50 JV pre-discovery and only applies to new licenses. Our high-level read through is simple: ‘Barrick has continued interest in Reunion’. Stepping back, the recent pullback on share price should be viewed as a buying opportunity, not dissimilar to the many pullbacks seen by Great Bear from ‘discovery to take out’. With ~C$49m cash at Nov 2022, and a world-class discovery, Reunion remains in one of our highest-conviction discovery names right now ahead of maiden MRE (mid-2023) and maiden scout drilling on new targets along strike (south) and to the west.

‘Best in class’ engineering firm retained to lead engineering; mid-2023 maiden Oko West MRE

Reunion Gold announced G Mining Services has been chosen to provide full engineering (PEA) and project development services for its Oko West in addition to the already ongoing maiden resource estimate work scheduled for mid-2023 publish. Ahead of this, Phase 1 step-out and infill drilling is planned on the Kairuni zone to outline the full extent of pittable resource envelope, while concurrently testing three priority exploration targets at Oko West including Takattu to the south.

Separately on February 13th, Reunion reported a Statement of Claim issued by Barrick in the Ontario Superior Court of Justice on February 10, 2023 relating to the Company’s termination of its Strategic Alliance Agreement with Barrick dated February 3, 2019. Barrick alleges that the Strategic Alliance should continue in perpetuity and that Reunion’s termination of the agreement is invalid. Reunion believes that the claim is without merit and intends to vigorously defend against it.

Why we like Reunion

Oko West: SCPe 2-3Moz drilled, 3-5Moz potential for CY23 maiden MRE

New southern zone emerging at Block 6 to the south

Granitoid potential following 3m @ 61g/t and 10m @ 17g/t maiden in-granitoid drilling

Guyana ‘guru’ management team, asset outside Barrick JV alliance for 100% ownership

Guyana: best LatAm Archean with, M&A / investments, oil boom and multiple discoveries

Catalysts

1H23: Kairuni Zone expansion drilling along strike and <575m vertical depth

2H23: Follow up exploration at Takutu, Carole, and 8,000m RC scout drilling at Bryan Zone

Mid-23: Maiden Oko West MRE: SCPe 3-5Moz

Research

Brandon Gaspar (Toronto) M: [phone] [e-mail] Eleanor Magdzinski (Toronto) M: [phone] [e-mail] Konstantinos Kormpis (Toronto) M: [phone] [e-mail]