Why Scally and Goliath will light the fuse30 Jun 2020 14:18
When discussing the possibility of Scallywag or Goliath striking similar mineralisation, and what the effect of that would have on GGP's SP, consider this...
When we hit Havieron, there were many unanswered questions, how would GGP fund the drilling, who would mine it, where would it be processed, would we need to dilute further? As time progressed these questions have been slowly answered, leading to the steady rises in the last 12 months or so, but it was slow going before that.
So what would be different if Scallywag or Goliath struck?
In my opinion, if any of the initial DDH1 drills show similar mineralisation to HAD5, you are going to be in for the ride of your lives.The market will instantly price in the fact that...
- GGP will be able to fund ALL further drilling to get the project to MRE stage (aprox £100m) with the proceeds of Havieron sale/part sale.
- once at MRE this asset could be worth multiple billions to GGP as a 100% owned deposit
- GGP will be able to agree on a toll processing agreement with Newcrest at Telfer if they decided to mine, or sell the lot to the highest bidder.
So if Havieron is worth £1bn to us at 30% ownership, arguably a few stellar cores from either one of the two immediate projects, could propel GGP into an unimaginable £3bn-£5bn valuation in double quick time.
In terns of Share price action: the Havieron discovery was a smoking gun, the next one in comparison, will be more like a volcanic erruption.