RE: Ambrian3 Dec 2021 20:35
“SolGold (SOLG CN: C$0.40 | US$740m) is listed on the LSE and the TSX. Its main focus is the 85%- owned Cascabel project, a porphyry copper-gold deposit in the Imbabura Province of north-west Ecuador, near the border with Colombia. As at September 2021, the company had net cash of US$110m.
The resource currently stands at 11.2Mt of copper and 23.6Moz of gold. The company published a PEA in May 2019 and the project is expected to produce 139kt/y of copper and 219koz/y of gold LoM average at a total cost of US¢53/lb over a 57-year life (50Mt/y staged ramp-up scenario). The initial capital investment for the project is estimated to be US$2.4bn. At a copper price of US$3.30/lb, the PEA for the project returned an NPV8 of US$4.1bn and an IRR of 25%. SolGold is investigating both high tonnage open-cut and underground operations. A resource extension drill program has been underway this year at Apala and a delineation program at the nearby Tandayama-America satellite prospect where a maiden resource has been announced. A PFS was scheduled for completion at the end of 2021 but has been delayed following the recent appointment of a new CEO.
SolGold has attracted considerable corporate interest. Newcrest Mining currently holds 13.5% of the company and BHP holds a 13.6% interest. In 2020, Franco Nevada completed a US$100m royalty financing.
The upcoming PFS will be carefully watched and a competitive bid for SolGold could occur if the Cascabel project achieves expectations. We believe there is a High possibility of a third party (including the minority shareholders) looking to acquire the project outright or taking a significant interest in the medium term”
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