Post by
goldhunter11 on Feb 26, 2018 11:56am
AZX Assets - We forgot Sleepy and Akasaba
All,
In determining the value of the assets AZX has we seem to pay most of our attention to the flagship Orenada...and try to assign (myself included) some rock bottom value to the orphan properties in othe provinces such as Wim and Hudvam. The idea is to try to avoid huge dilution of the company via equity finance (which EO has done without the consent of the BoD for some $20M, while the Market is ~$40M...this is self-serving as the BoD indicated, and not for the interest of shareholders). If AZX can divest those 2 properties in Manitoba it could get at least $30-40 M, or more if it can find a good dance partner (Hudbay is nearby). Anyway, what we, at least myself, have forgotten to bring in the discussion are Sleepy and Akasaba.
- Sleepy: Currently, if PRB is successful complete the terms of Phase 1 of the JV, then it can get 60% of Sleepy, and AZX 40% = 0.122Moz = extra $12M on AZX assets.
- Akasaba: The 14 claims with 0.33Moz Au @0.69gpt and some copper @ 0.41%. This is a low grade deposit, so may be it was fine for AZX to let it go to AEM for $5M. But the Main Zone just to the east seems to be a much better (high grade) deposit. In fact, AZX spent quite a bit of money on
Akasaba (they even did the downhole IP survey) and found the North Zone (100m away on the north side, low grade/long intercept and high grade over 6gpt/1.5m) and Kettle on the east side (decent grade, over 2.3gpt). Let's put the North Zone and Kettle in the "future potential" category for now.
The main Akasaka has an NI-43-101 Tech Report dated May 1st 2012. Link below.
https://www.azx.ca/ir/reports/akasaba_ni43101.pdf
There was suggestion to do a PEA, but I have not seen this yet. The details are in this report, but the total resource (Indicated/Inferred) for both OP and UG is 0.525Moz with the UG has high grade from 5.3-5.9 gpt. Not that the North Zone has high grade at depth only about 100m away.
So, 0.525Moz for Akasaba would add another $52.5M to the bottom line.
Total, 40% Sleepy plus Akasaba: 12 +52 = $64M
If we had 1Moz for Orenada, this would give $100M
Orphan propeties (Wim and Hudvam): $30-40M, say $35M
Grand Total : $199M, or $299M (for 2Moz for Orenada)
If $100/oz in-situ is too high then $75/oz in-situ would yield $150M to $225M, depending on Orenada RE.
SP: $0.25 - 0.42/s, assuming 600M shares.
Any fatal math error?
Feel free to weigh in. Let the BoD know your expectation so that they don't sell us short. But, you have you last say with your votes.
GH
Comment by
RYUcan on Feb 26, 2018 1:28pm
Excellent post, thanks. I agree it is udervalued and your numbers sound out just how much if not conservative especially with GP run coming and minimal discovers. JMO