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You are correct that the Tropicana deal was $852 / oz and in Australia.
Let's just assume for giggles that we sell our share of Hav for the same price. $852 / oz. You were doing great up through multiplying £185 by a million to reflect 1 moz. You now have £185 million. But then the Aussie government will say, "Congratulations. This has been a wildly successful exploration, you've made a profit of £185 million. And we're having 30% of that because that's corporation tax on your profit."
Our accountant says, "Well, we had some expenses, you know," and they say, "Sure, deduct them, by all means." So the net result might be that our profit (for tax purposes) is something like £180 million per moz. They'll take 30% of that (£54 million) before anything comes back to shareholders. Your moz is now worth £126 million, which takes you to about 3.1p / share.
The $852 / oz is a pre-tax price. The transaction will get hit by corporation tax.
Prof, agree. The interesting thing is Regis are paying (valued $852/oz) for 30% interest in the mine based on known reserves of a depleting mine, with no copper and perhaps some potential for growth of the resource, but nothing compared to HAV. AISC of $900/oz, thus one must assume Regis are quite bullish on the gold price.
Now let’s fast forward and assume we have a proven resource of 7-10m (100%) at HAV at some point 2021, with ridiculous copper grades and industry knowledge knowing this ore body has the potential to exceed 25m oz. Huge growth compared to Tropicana, bullish gold price and an AISC somewhere between Cadia and Tropicana ;)
When the above starts to develop in earnest, we will likely be 12 months max away from first pour at HAV.
So, as we progress this year into next, what would some be willing to pay for our % of HAV? This is why some of the good posters like Hydro and Spy say things like ‘bidding war’. I’m sitting on my hands just for the entertainment of it all.
The Regis / Tropicana deal is also in Australia and so I don't think we need to deduct anything from the 4.4p to take account of corporation tax: it'd be in that $852 per resource oz figure.
About a year ago there was a lot of discussion about how to value Havieron and the consensus settled on the share price as being between about 4 and 5p per million oz. The Tropicana deal seems to support that.
@Prof It's a blunt instrument indeed. You can make it a little sharper by deducting 30% from your 4.4p / moz, to reflect the corporation tax that the Aussie's would rudely insist we pay. That would put you at around 3.1p.
But it will still be a blunt instrument, and probably understate our value if we hold it and mine, rather than sell it.
If we look at the recent Regis / Tropicana deal which valued the gold at $852 per reserve oz and apply it to our reserve we get about 4.4p per million oz.
That'd value a 10m oz resource for us at 44p, 15m oz at 66p and so-on. At the current SP the market seems to be banking on a resource of roughly 5m oz, which I think most would think very conservative.
Hi Jerry. I do not always get it right, i bought a shed load of silver in 2011(ouch) As far as the POG/S goes the only way is up with a bit of shenanigans from the banks on the way. I see GGP earning $2500/oz (after costs) by the time we are mining if not more. The POG/S has just started on its bull run and the level achieved will exceed most PIs expectations. ATB Speedy
I just love to see all these praises flying about, as well as the usual, dare I say it, arrogant types, posting their sp predictions to the GGP mast!
Quite frankly, I don't know why most of them bother...Most sp predictions fall flat on the face of the predictor, that's why I never do so. The VERY rare occasion(s) when the predictions actually occur leads to the usual, arrogant, "I told you so" posts.
It is what it is! IMHO, just research and know where you stand, and largely ignore the pointless predictors!
Tildo, I appreciate that its frustrating that we dont have the sp action that we had last year, but I am told that Shaun has hit the ground running with bags of energy and loads of ideas. Everyone says that he is a great communicator and he has done plenty in that regard so far. Any more and he will be telling us what he had for breakfast. He doesnt manage the SP, he manages the company. If he does that well the sp will look after itself. Great exploration news will do that. However if you listen to the multitudes of PM commentators you will hear them say that the sentiment in PMs has been awful. Fortunately Speedy knows that this is about to change, and he tells me that he is never wrong.....So just a bit of patience needed.
We could pay for Spymaster to use his sleuthing skills on Shaun 'Like' Day I guess lol I suspect SD is extremely busy as is usually the case when you take over as the CEO of a company and are a driven and ambitious type which seems to be the case with Shaun's professional history. He's probably getting to grips with everything, assessing and deciding on if/where to change things up and we've see a new license application so he is looking at us beyond Hav I feel. From my understanding they also have a consultant on board for a while now - so perhaps looking at divestment of some of the other licenses and there could always be a left field announcement as we saw with the unexpected Juri JV. Gervaise will be a hard act to follow but we seem to have the right person in place for the next stage of our journey in Shaun - time will tell - but I'm very optimistic and the next set of results will remind us of how lucky we are to be invested in such an amazing discovery as it will have been a long 7 weeks since the last set :-))
Hi Tildo, We all share your pain since the SP has dipped from 37 ish to where it is now. However, you are right, POG, results etc will be the facts that bring it back in line with the reality of this giant prospect/s. SD may not have GH's charisma or flamboyance, but he is a grafter by the look of him and makes no bones about his ambitions, which are to turn us into a multi mine multi billion dollar company! Good enough for me. After a quit start to get his feet under the table, he has shared comments in mining press, done at least two pro-active video interviews post results or news and started to tweet and find his own style. The important thing is he is buying up more prospective land to make his ambitions (and ours) hopefully come true! We will get there I believe, though I agree sometimes it seems unreal that the market has not picked up on our potential.