Probe Gold Inc T.PRB

Dark Horse

[Goodluck395]

An informative article from The Northern Miner 

was written about the Cote mine . Located 125 km SW 

of  Timmins, it's a JV between IAM Gold and Sumitomo 

Metals Mining(60%/40%).

Some of the stats

Expected to produce 365 000 oz/year .

Mill Capacity 36 000 t/day

LOM : 18 years 

Construction Cost $1.9 Billion 

Expected grade 1g/t

In 2022(pre construction) , Sumitomo purchased 

another 10% stake in the JV for $340 million. Implied valuation of $3.4 billion less the $1.9b in construction costs.  ($1.5b net)

IAM Gold has an option to repurchase this stake by November 2024, which they announced they are going to exercise . No option price was provided.


From Probe Gold's perspective 
This represents about 50% of Probe's production over 
LOM,  Relative to the JV.

Based on this scenario, despite PG's much higher average mill head grade, PG is valued at $3.95/share.

[Goodluck395]

I love horse racing, but I must admit this JV was not on my race card , in terms of PG being acquired by  them until i read this article. Once the option deal closes in November, Sumitomo  will have overflowing liquidity to redeploy this  cash pile ( logically at least $340 million).  I hope that PG will have the welcome mat out by then and the welcome flags flapping in