Columbus Gold Corp CGTFF

Columbus Gold Announces Positive Bankable Feasibility Study

[123buyholdhope]

Columbus Gold Announces Positive Bankable Feasibility Study
 
Thank you to those who have already commented on the BFS. Here are several points I gleaned from an initial reading of the BFS. For Giustra "The completion of the Bankable Feasibility Study is a major milestone in the advancement of what is clearly a significant gold deposit with substantial potential (my bold). For shareholders CBGDF now has a core mining project with P&P oz reserve (2,745,000) within a M& I resource (3,850,000). Such numbers may now lead to a more formal evaluation of CBGDF sp by analysts who could look at either the value of ozs in the ground or a hypothesized buyout value for those ozs.
 
Further, as Guistra indicates the potential for both ozs upgrade and increase are substantial – both NG and CBGDF together want to initiate an infill drill program within the BFS pit to move the approx. 1 mill ozs in resource up into the reserve category. This will benefit both CBGDF and NG re the value of this project which itself will influence their ability to raise capital to financ this project. But it is CBGDF that is also going ‘hell for leather’ to expand the resource well beyond the BFS pit (not an important objective for NG who would obviously prefer to do this exploration themselves after the project is within their entire control). The defined Montagne d'Or pit is only a small portion of the much larger Paul Isnard area (150 sq. km) under CBGDF permit. Therefore, expanding the value of this project is vital to CBGDF’s own value. Relatedly, Guistra also indicates that there is the potential to improve the value assigned to the project itself by the BFS (beyond just an increasing gold price), via identifying lower capital and operating costs than those used in the BFS (a reason CBGDF may have hired a third party to scrutinize the BFS itself).
 
Further a really interesting revelation comes from a comment made by Guistra re., the BFS: He states "In parallel with additional drilling, Columbus is evaluating a number of indications of interest it has received to fund mine construction, the next logical step for the development of the Montagne d'Or deposit." I do not know the legalities of guarding and presenting BFS information but this comment suggests that these entities were contacting CBGDF (“…it has received…”) about funding the FG mine well before the BFS came out. Would banks have expressed interest in providing funding to CBGDF without a BFS in hand? Or might this be entities such as Franco Nevada or Silver Wheaton who are interested in providing funding for CBGDF’s FG mine portion? This in exchange for a % of overall ozs produced, or a $ fee per oz., mined (e.g. Silver Wheaton provided approx.., $150 mill for 10% of Sandsprings PFS identified potential mine ozs., in the more risky Guyana with no JV to support - like NG). Or is a major(s) interested in funding (or buying) CBGDFs FG mine portion? Certainly selling a portion of the mine to a royalty streamer like Wheaton would complicate a buyout by NG or a major. Is this Guistra playing one of his cards? Is he firing a shot across NG and any other interested majors (bidding wars spurred by fear of missing out are wonderful sp multipliers)? Further, having their portion of the mine costs paid for via a royalty on their ozs (which will only increase in # over the next 18 – 24 mine building months) would allow CBGDF to focus on developing Eastside /Nevada, while watching an increasing sp based on the fast approach of actual mined ozs along with a possible increasing gold price.
 
The BFS and the comments around it have made the CBGDF story more and more interesting. Majors and royalty streamers are now seeking to increase their access to real ozs and viable exploration success in safe areas with minimal blocks to mine building. Eastside has little or no impact on CBGDFs sp presently and yet more drill results for Nevada (approx. 1.6 mill ozs inferred so far) are coming in the next couple of months. I am getting a sense that Guistra is trying to get into the driver’s seat with the BFS project so that he/we are in a win win situation regardless of the path CBGDF takes in FG.
 
Any other viewpoints would be appreciated.

[BullStockington]

@123 Thanks for taking the time to put up a really in-depth insightful post.  I especially agree with your first point in terms a short-term SP driver. The BFS definitely gives it a level of legitimacy seperating CGT from the dozens of other junior explorers on the tsx/tsxv. This should lead to increased coverage and thus SP (a couple months back after an analyst named byron king put out a

[creaturecomphort]

ok, so given the good news why is Columbus down sharply today?

[goldinontario]

firstly I am not sure it was "good news" but it was expected news.  The numbers didn't deviate too much from the PEA which I guess is good news. IMHO, the reason it is down (and now recovering) is that people pushed it up in anticiaption of the news and then sold on the news (i.e. the old adage, buy on rumour sell on news).  Once the letter writers and analysts weigh in

[BullishOnCorn]

goldinontario - I agree that we should expect a recovery and i project the stock to go above $1 in the coming days/weeks. What i am somewhat concerned about; however, is the outlook on corn yields relative to soybeans. As we all know, high perfomance in the corn sector = high performance for gold, so with the soybean:corn ratio looking high for 2017, I am somewhat worried about how this will