Nice return.
Nothing else interests me at the moment.
The world is fucked.
Will start a summary of buy and sells shortly.
The Prowling Tiger.
Sunday, March 21, 2010
Sunday, November 8, 2009
PRU - Perseus Mining
Perseus is one of the best potential gold juniors firming up resources in West Africa and about to move into development after a positive DFS and two decent capital raisings.
Current resources stand at:
Ghana - Ayanfuri (some exploration work being conducted under current open pit designs)
4.0Moz* - 87.3Mt @ 1.5g/t Au @ 0.8g/t cut-off
2.0Moz* - 90.5Mt @0.7g/t Au low grade
Ivory Coast - Tengrela (initial resource, looks set to be significantly upgraded in the coming year)
1.0Moz* - 15.6Mt @ 1.9g/t Au >1.0g/t
A DFS has been completed on Ayanfuri and contractors selected with construction due to start Q1 2010, for first production possibly Q1 2011, but scheduled for Q3 2011. The DFS estimates 220k pa @ USD392 cash costs in the first year.
An initial Scoping Study on Trengrela envirages a 100k oz pa operation @ $396 cash costs starting some time after Ayanfuri is into development. However, recent exploration drilling is indicating that this could be a much larger operation and might even eclipse Ayanfuri.
PRU are in the process of raising an additional $58m to add to their current $60m ish cash holding to have around $110m in the bank to be used for the construction at Ayanfuri.
This will take their capital structure to:
352m ordinary shares
11.2m unlisted options
363m fully diluted
At current share price of $1.54 this gives them a MC of $561m and an EV of $451m.
EV to ounces of gold is about $63, which is high for an explorer but about right for a developer. High quality producers tend to be over the $100 an ounce mark.
For a company with such significant resources (although lowish grade) about to start development of a 220k oz pa mine, and working into a second mine of similar nature, this seems very low on a peer comparison in the region.
A close comparison could be made to Redback Mining who have some slightly better grades and possibly greater exploration potential, but they are not that far ahead. Redbacks market cap is now well above $3 billion, with PRU back at 500m ish.
Lots of upside here, if they get to production without too many start up engineering issues. If all goes to plan, then they should be rated above $100 an ounce which is about double the current share price.
The yearly chart shows a clear uptrend from the crazy capitulation lows in Dec 08 with the diagonal uptrend line down around $1.00, which links up with some very good horizontal support. On a major correction in the market then I'd anticipate that these levels could be possible. However, with the just completed capital raising at $1.50, this provides significant psychological support. Adding anywhere between these levels should provide great returns in the long run.
The Tiger buys at $1.50.
Current resources stand at:
Ghana - Ayanfuri (some exploration work being conducted under current open pit designs)
4.0Moz* - 87.3Mt @ 1.5g/t Au @ 0.8g/t cut-off
2.0Moz* - 90.5Mt @0.7g/t Au low grade
Ivory Coast - Tengrela (initial resource, looks set to be significantly upgraded in the coming year)
1.0Moz* - 15.6Mt @ 1.9g/t Au >1.0g/t
A DFS has been completed on Ayanfuri and contractors selected with construction due to start Q1 2010, for first production possibly Q1 2011, but scheduled for Q3 2011. The DFS estimates 220k pa @ USD392 cash costs in the first year.
An initial Scoping Study on Trengrela envirages a 100k oz pa operation @ $396 cash costs starting some time after Ayanfuri is into development. However, recent exploration drilling is indicating that this could be a much larger operation and might even eclipse Ayanfuri.
PRU are in the process of raising an additional $58m to add to their current $60m ish cash holding to have around $110m in the bank to be used for the construction at Ayanfuri.
This will take their capital structure to:
352m ordinary shares
11.2m unlisted options
363m fully diluted
At current share price of $1.54 this gives them a MC of $561m and an EV of $451m.
EV to ounces of gold is about $63, which is high for an explorer but about right for a developer. High quality producers tend to be over the $100 an ounce mark.
For a company with such significant resources (although lowish grade) about to start development of a 220k oz pa mine, and working into a second mine of similar nature, this seems very low on a peer comparison in the region.
A close comparison could be made to Redback Mining who have some slightly better grades and possibly greater exploration potential, but they are not that far ahead. Redbacks market cap is now well above $3 billion, with PRU back at 500m ish.
Lots of upside here, if they get to production without too many start up engineering issues. If all goes to plan, then they should be rated above $100 an ounce which is about double the current share price.
The yearly chart shows a clear uptrend from the crazy capitulation lows in Dec 08 with the diagonal uptrend line down around $1.00, which links up with some very good horizontal support. On a major correction in the market then I'd anticipate that these levels could be possible. However, with the just completed capital raising at $1.50, this provides significant psychological support. Adding anywhere between these levels should provide great returns in the long run.
The Tiger buys at $1.50.
Subscribe to:
Posts (Atom)
