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Centamin and Capital seemed to have had a very symbiotic relationship from the start of Mining (incl exploration) at Sukari, and this continues to this day. It would be interesting to look at the disclosures about this in the Annual reports for better disclsure, but if I recall CEY and/or its directors were significant seed funders of Capital? (again have to look at the relevant annual reports)
https://www.capdrill.com/media/investors/Presentations/Corp-Presentation-Jan-2011.pdf
"Capital Drilling has been active at the Sukari mine since 2005 and currently runs a fleet of 14 rigs, providing Sukari with blasthole and grade-control drilling services in the open pit.

Commenting on the contract extension chairman Jamie Boyton said: "Capital Drilling has been working with Centamin for 14 years, and we are delighted to continue this relationship as the demand for our services continues."

best
the gnome

Cowichan

Yes I heard that statement about Open Pit Resources, but remember MH is a Mining Engineer, and they are always on the conservative side of the fence in my experience, at least the very good ones are. They can be surprised, espcially when it comes to Geology.

It seems to me the propblem with how they had to manage the wall situation, is as MH said. The previous mine plan did not have sufficient optionality to allow this to be managed in a more normal manner. It is a normal occourrence to certain degree, and one which is built into the mine plan, if it is a proper mine plan. It clearly was not!

MH said on numerous times that he has and is building in proper optionality to cover such future events,

The previous "mine plan" by the previous "management" seems very suspect to me (bit like some of Pardey's presenations I suspect), and it is going to be interesting to hear what the future LOM plan is for Sukari, which is the next presentation as I understand it.

What I took home from the Doropo discussion was interesting
1. BFS mid next year (mid 2022)
2. Development team in place
Given they have the same development team as Toro, and Doropo is similar to Mako, this would indicate production of 200k ounces pa would probably start 2024, and first 5 years likely to be 200k pa...

Review Mako development ....

The definitive feasibility study (DFS) and the environmental and social impact assessment (ESIA) of the project were completed in July 2015. The project received a 15-year mining concession from the Senegalese Government in July 2016.

Construction of the project commenced in August 2016 and first gold was poured in January 2018. The initial production was started in February 2018.

Approximately 859kt of ore processed to produce 62,900oz of gold during the first six months of production ending June 2018.

The mine is estimated to produce 137,000oz of gold a year during the first six years of production.

Bought by Resolute for $400m

By 2024 they should have a bfs on ABC all going well, and away we go there.

best
the Gnome

For those wanting to see one of the most exciting GOLD DISCOVERIES OF THE LAST 10+YEARS...(very few of these!)

https://www.youtube.com/watch?v=2iikY6964Eo&t=74s

https://www.investi.com.au/api/announcements/pdi/fd77fa78-685.pdf

Predictive Discoveries finally comes through, and what a fabulous ore system, and my bet is the system will grow past the magic 5 million ounces...!!! Ahead of myself, but the aroma's are very positive and a maiden resource of 3.65 m ozs,, in 17 months in these times in Guinea defies imagination, although the Geology has always been very good ....

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the Gnome

I think the CEO is clearly a risk taker, however he does like to understand and quantify the risks before jumping in. I have no problems with that. One of the big negatives in the gold industry is the propensity of many of the MD's/CEO's, to jump in boots and all (using shareholdereds money and script), bid assets up, jump before measuring...etc
Some highlights form the last few decades ...
> significant impairments totaling USD 129 billion since 2011, as fallout of the previous MandA
> gold reserves have declined by approximately 26 percent to 713 MOZ, due in part to an approximate 70 percent
reduction in exploration expenditure as companies sought to preserve cash.
> the average price paid per ounce reserve in the period was often more than 300 percent higher than deals
executed a decade earlier
> 70 percent reduction in exploration expenditure as companies sought to preserve cash, and drive down the AISC
(so short term gain for long term loss)
> what money that has been spent on exploration has come up virtually dry of new tier one discoveries (and here lies another sleeping giant - all the low hanging fruit has been picked over, at least once!)...maybe 5 discoveries of 5+ M Ozs since 2005...and it looks like DOROPO IS ONE OF THEM!

This raises the uncomfortable prospect of a looming reserve crisis.

https://www2.deloitte.com/za/en/insights/industry/mining-and-metals/tracking-the-trends/2021/mining-mergers-and-acquisitions.html

No growth? I doubt it, perhaps listen more carefully to the presentation and consider history of the gold mining and exploration industry. The last thing the company needs is a risky CEO..they have been there and done that!! Learn and move onwards and upwards.

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the Gnome

Couldn't agree more Cowichan. I have never been impressed with Norm Baillie, and I am not alone. With the strong and rightful emphasis on robust Geology in exploration and mining, things had to change.....and yes, it does take a whole lot of time to clean the cupbord out, so to speak, and I think we are just about there.

BUT very impressive on the shareholder/owner communications, and really hope this continues!!!

> well structured
> content is excellent
> delivery excellent
> very clear sense of strategy
> very clear sense of priorities and action plans
> Very clear annunciation of future events

As far a gold mining companies go, this is an excellent start and first in class, and obviously a robust way of building investor confidence.

I like the way the team is looking at Doropo, and their description of the project, hurdles for projects etc gives me a lot of confidence. Backed by the Toro (now CEY) development team, this should fly. Did you pick up the fact that they had been heavy handed in CAPEX?

I think they could now build the assets into cash producing assets, which was always what they wanted to do...BUT you do have to have the right people in the right team to do this, Sounds easy? It is not!

All from your faithful correspondent in the colonies, but perhaps one last thing for those cynics and skeptics. A review of the 10 most powerful people in Australia has yielded the state premiers!....With the authority to shut down our biggest cities and keep millions trapped in rolling lockdowns (which they did and still are doing despite strong evdience that their strategies were not the best!!), the premiers of Australia’s most populous states harnessed COVID-19 fear and loathing to become the nation’s most powerful people in 2021. What a sad state of affairs in the Un-United States of Australia. Good luck to the next few generations, hope they can do a lot better than this mob, but they are starting the race with their 2 legs tied together and dragging a heavy anchor.

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the Gnome

Interesting comments in West Africa

Firstly review the value realised in the Toro, Mako Gold Project, 6 year mine life etc...US$274 m acquisition
https://www.rml.com.au/mako/

The Toro development team, has perfromance credibility in francophone West Africa, and now largely in CEY

Doropo would seem to be twice the scale of Mako...12+ year mine life etc

How much value has Doropo got on CEY market Cap?

Other development opportunities.... in their held ground....

Game on in West Africa

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the gnome

Thanks very Craigl !

Can someone please provide a workable link?

RICK RULE: ‘I would argue that if you look at Australian gold equities, particularly the mid-caps and the single asset producers, they are selling at the lowest multiple of net present value to enterprise value that I have seen in a 45-year career.

‘These companies are statistically as cheap as they have ever been, at a point in time when I believe gold is going to go up.

‘That makes them very attractive to me.’

and CEY...and what happens in the MandA space. Lets get some lateral value add?

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The Gnome

Lets hope any contract awaring follows best practise. Lots of variables in these contracts, and a fair element of trust and goodwill, dare I suggest.

The total contract cost...new legals, new relationships

Devil in the detail, and can be more devil in the execution and managemeent in my experiene.

good luck to us all

the gnome

Market22, We have been through this subject previously. Lets see now the Mine Geology Dept appears ot be properly recognised and resourced (finanially and people wise), just what happens to the gold reserves and gold resources. Ditto for the near Mine Exploration...How the past management could let it get to the state it was, is only testimony as to how far they were out of their depth....

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the Gnome

Whilst the State of Victoria Safe work Department sues Victorian Health Depratment for $65m for not providing enough training on covid managemnt, the Victorian State settles closer to insolvency, at least that would be the case if they were a corporaton

Best and worst ON ASX, BEST WERE THE GOLD MINERS,
St Barbara UP 4.9%
Evolution Mining UP 3.1%
Silver Lake Resources UP 2.1%
Regis Resources UP 1.9%
Northern Star UP 1.9%

WORSE AGAIN?...STATE AND FEDERAL GOVERNMENTS
Still paying out $1b in covid assistance ot over 1.5 m Australians

but we are doing well!

There is a slight issue with credibility, in those that serve us

Could be a lesson in todays trading, hinting at how things will play out in the longer term ...

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the Gnome

and I wont be surprised if there is not a (serious) upgrade for CEY in Resources

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the Gnome

Thanks Cowichan,

but you put more flesh on the bone, so to speak.

A most remarkable upgrade, or just exactly how did this happen. Was there an issue in continual disclosure, or was the Mining Resource team undermanned or just incompetent? Funnier things have happened, but it is a most remarkable upgrade, in such a short time, JUST preceding a merger...one would think there are questions to be asked and answered...

regards
The Gnome

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the Gnome

As mentioned previously MandA is the way the Gold Industry growth pat, once they have done the brownfields exploration path.

The Hymn Book?
Step 1. Put out your resoure upgrades
Step 2. Announce a new discovery
That is prove there is plenty of ife in the old dog, get the SP up and away we go.

So Kirkland Lakes Open Pit upgrade was interesting in time and amount....
"Kirkland Lake Gold (TSX: KL; NYSE: KL; ASX: KLA) has released a mid-year updated resource estimate for its Detour Lake mine in Ontario, adding another 10.1 million oz. of contained gold. Measured and indicated resources are now 572 million tonnes grading 0.80 g/t gold, totalling 14.7 million contained ounces.

The inferred resource has grown, too. The estimate is now 1.1 million contained oz. in 48.3 million tonnes grading 0.81 g/t gold.

Resources were calculated using a 0.5-g/t gold cut-off grade. Provision was also made to stockpile low-grade material for future processing rather than treat it as waste.

The resource update used data from 365 holes or 185,000 metres of surface diamond drilling completed in the last 18 months. (Kirkland Lake bought out Detour Gold Mines in January 2020.) Another 100,000 metres are planned by the end of the year."

More to come I suspect

good luck shareholders
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the Gnome

There is potential for a lot to happen. There are a lot of unhappy people, unemployed, underemployed, and employed but have not had a pay rise in years, etc and v little on the horion, (if they keep their jobs!). The traditional way of justifying a pay rise is a producivity increase, and this is almost impossible to imagine. Bureaucracy has gone mad, logistics is a disaster area, negatively impacting on, stock, supply lines, production, Universities have been shown to be a tad short on the money in their business model turning out graduates who do not know anything about entrepreneurism let laone how to do things...(not to mention management prowess), woke has spoke and continues to do so. Thanks goodness for commodity prices in Oz. I am titillated by the supersized evaluations on the new technology companies, most of which appear to have a very thin moat, and I guess it follows a short life, so best to ramp and dump as quick as possible.

Possibly a tad jaded commentary,

Whichever way they wiggle is going to cause more discomfort, to a a lot of people who are not at all comfortable now.

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the Gnome

Reserve Bank of Australia in their June 2021 bulletin, titled The Global Fiscal Response to COVID-19 , mentioned ...“globally, the fiscal policy response to the COVID-19 crisis has been the largest and fastest in peacetime”.
https://www.rba.gov.au/publications/bulletin/2021/jun/the-global-fiscal-response-to-covid-19.html

According to the researchers, higher levels of government spending will continue after infections have been brought under control, although the emphasis will shift, with “a greater focus on public investment, particularly in green and digital initiatives, incentives for more consumption and private investment, and retraining programs for workers in those sectors that are expected to have been severely impacted during the pandemic”.

Not surprisingly, this surge in spending has pushed global government debt levels to the highest level since World War II.

According to the Institute of International Finance, global government debt climbed to 105 per cent of global gross domestic product in 2020, from 88 per cent before the pandemic.
https://www.iif.com/Research/Capital-Flows-and-Debt/Global-Debt-Monitor
Dillon Hale is an advisor to family offices.
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Wealthy families falling behind in managing their fortunes
Total government debt could rise by an extra $US10 trillion ($13.7 trillion) this year to hit $US92 trillion, with developing countries accounting for the bulk of the increase.

The risk, of course, is that financial markets will eventually become anxious about this explosion in government debt, and will push interest rates higher to compensate for the growing risk.

Torn...

I think it seems reaonsbale to assume they will go after that sort of target very quickly, and share the result.

One of things they are going to have to be caeful about is the gold turn around at the assay Labs in West Africa, if they want o effectively move the project forward quickly. It is abysmally slow, as it is in many places, so they need to think about this now and act quickly. There are ways now, as per a previous post I made

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the Gnome

I remain fixated on the MandA activity, and the business starts in the usual place

A buyout boom fueled by easy money and a looming hike in the capital-gains tax is sweeping Wall Street deal making to highs not seen since before the 2008 financial crisis.

Companies have issued $120 billion of “leveraged loans” this year through Sept. 23 to finance corporate buyouts by private-equity firms—just shy of the $124 billion record for the first nine months of the year set in 2007, according to data from S&P Global Market Intelligence’s LCD.

A mix of government policies have primed the LBO frenzy. Easy money and low interest rates have pushed investors toward the high yields that leveraged loans pay. Meanwhile, company owners are trying to cut deals ahead of anticipated tax overhauls.

Sibanye Stillwater's (NYSE:SBSW) CEO Neal Froneman has suggested gold miners AngloGold Ashanti (NYSE:AU) and Gold Fields (NYSE:GFI) should combine with Sibanye...

The cost focus as well as brownfield focus (starving greenfields exploration), lack of an low lying fruit for Juniors (plus lack of any success) has pushed themajor gold players into the MandA rooms for growth ... A McKinsey analysis (2020) suggests that, as a result, reserves of major gold companies have decreased by approximately 30 percent since 2012. So the deterent to date has been premiums in the market valuation of Gold Companies, but with the SP of most majors being down , then the premium to be paid is not the deterrant it used to be...and if the SP of the Gold Companies conintues to be down, and the int rates down, then life could be interesting.

Could the new man at the helm repeat his last performance, at Toro? Just an idle thought

the gnome