Prudence & patience.26 Nov 2021 08:33
Seems from what I've been reading gold in the ground where quality is more important than quantity is est at anywhere between $100-$200 worth in W.Africa. That's a big safe spread taking into account the risks.
Once an MRE has been issued you can make an informed guess as to value of the project (multiply the quantity by current gold price). You then take the mrkt cap of the Co and ÷ by the nos of ounces to calc mrkt value per ounce of Gold in the ground. This should indicate if the project is under/over valued against its peers and whether it has scope to multi bag. Sorting the pretenders from the contenders at this stage is advise given many never make it. So to sum up.
* POG is the most important factor.
* Cut off grades, ie the min that can be mined, processed etc (not all ounces are created equal).
* OPEX inc all direct and indirect costs.
* CAPEX costs to build & produce spread over the years and what you might expect a mine to economically produce over its lifetime.
* metallurgical skill.
* skin in the game by management, insiders and funds.
Determining the 'real' value of an ounce of Gold in the ground is crucial but as we know its beyond most pis to accurately assess this so we rely on experts, some of whom are little more than snake oil salesmen reliant on consultancy fees. Co Brokers / NOMADs dependent on commissions are unlikely to paint a bad picture for fear of being given the heave-o.
Whom you trust from the management, the independent assessors to the value of gold in ground could be the difference between a successful investment or a bust. From my little experience PAT falls into the undervalued category given our 8 projects in WA. Atm their is much hopium that MB will see PAT develop into a mid tier producer.
Seems from what I've been reading gold in the ground where quality is more important than quantity is est at anywhere between $100-$200 worth in W.Africa.
That's a big safe spread taking into account the risks.
Once an MRE has been issued you can make an informed guess as to value of the project (multiply the quantity by current gold price). You then take the mrkt cap of the Co and ÷ by the nos of ounces to calc mrkt value per ounce of Gold in the ground. This should indicate if the project is under/over valued against its peers and whether it has scope to multi bag. Sorting the pretenders from the contenders at this stage is advise given many never make it. So to sum up.
* POG is the most important factor.
* Cut off grades, ie the min that can be mined, processed etc (not all ounces are created equal).
* OPEX inc all direct and indirect costs.
* CAPEX costs to build & produce spread over the years and what you might expect a mine to economically produce over its lifetime.
* metallurgical skill.
* skin in the game by management, insiders and funds.
Determining the 'real' value of an ounce of Gold in the ground is crucial but as we know its beyond most pis to accurately asse
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