Mines d'Or in Guyana: Collective calls on Emmanuel Macron to stop the project of the "largest mine in France" that endangers the Amazon rainforest
https://www.demotivateur.fr/article/guyane-le-collectif-or-de-question-contre-le-titanesque-projet-minier-qui-menace-la-foret-pluviale-11049
Like most here I believe that this mine will be built. However, the opposition (along with Macron’s desire to ‘look’ concerned) might push the first pour date well beyond the early 2022 quoted by Nordgold officials. The more the opposition, especially if the French courts become involved the longer it may be before CBGDF sees any realistic buyout offer. Unless, again, NG tries low balling which Guistra should immediately shoot down (unfortunately, recent shareholders might find a 25% + premium attractive vs waiting for longer term gratification). Also, remember Newmont must be very concerned with this situation as they have several concessions in FG and will be directly impacted by any official decision. In fact, they may even become an out of left field player in this issue which would disrupt my thesis.
Being one of ‘the’ climate change proponents in Europe puts France and Macron in the headlights here. However, even with a Russian company leading this project and the negative implications this may engender, if they were to go against this specific mine permit France would be looking at a major arbitration action by NG and CBGDF (2.75 mill ozs P&P x $1200 + large potential hinted at = $?? claim). After all, the two companies have been basically green lighted by France over the life of the project in a mining permitted zone. Refusal at this stage could be very expensive for France (IAG and the Camp Caiman mine was not so lucky because of the zoning area they ended up being located in).
Yet, Macron might decide that political expediency is the best policy here and try to play both sides. While permitting the CBGDF/NG mine he may place major roadblocks in the way of the other 2-3 dozen companies presently involved with permits and concessions in FG (hence my thoughts re., Newmont acting). This may be a boon for CBGDF as the mine has a very solid P&P and also what looks like a very large potential especially to depth (even if no further exploration outside of what has already been conducted is permitted). Both improving mine economics and possible new FG mining restrictions would only add value to any serious buyout offer.
However, I also get the sense that NG is not that interested now in selling its %. They have not attempted to infill drill the pit area to increase P&P which would be very important to any attempted sale of the mine for ‘fuller’ value; including CBGDF’s 45% if they wanted to sell for ‘full’ value (which NG does not want to come close to paying, therefore, why give CBGDF more value ammunition). It was CBGDF themselves who initiated the exploration beyond the pit before NG earned their controlling 55%. This new data gives CGBDF some more negotiating power but unfortunately not what actual M&I ozs would provide and it is difficult see them being able to achieve such oz increases, beyond what their consultants may come up with when they announce their review of the BFS economics and the ESIA (and an increasing gold price?).
Consequently, CBGDF’s SP is presently in a holding pattern and it is not easy to see how FG will impact this positively even with a CBGDF financing arrangement contingent on getting a mine permit. Just too much risk presently, but long term there is the potential for much larger gains over 3 – 5 years re., mine construction, buyout or hopefully not arbitration.
Hence Guistra is placing his emphasis for fireworks I believe in the Allegiant spinoff where Eastside and Bolo are the main foci. My guess is that Cordex and Wallace were no longer prepared to stay with CBGDF if FG was still hanging around their necks. Again, my dream is a sale of these assets at spinoff while shares are at their tightest. Do we have a (mid)major willing to risk below $100 mill for serious district gold potential (present resource approx 1,500,000 oz in less than 10% of area), along with Cordex’s Nevada data/permit set which is second only to those belonging to Newmont and Barrick, and also led by possibly the most highly regarded area explorer in Andy Wallace? Probably more realistically, a major(s) may take a sizeable share base in Allegiant indicating firm interest. The funding of a 250 drill hole program could be enough to produce 1- 3 mill ozs in addition (on top of the approx.., 1.5 mill already); enough to bring in a JV. Ongoing data and news like this could have a significant impact on the Allegiant SP over the next 1-2 years, again, especially in a rising gold price environment.
Only time will tell and I think our patience will be tested. Please DYODD.