Sprott / Cerrado RNS3 Mar 2023 08:22
Bit of Cerrado news:
"Mark Brennan, CEO & Chairman of the Company, commented, "We are very pleased to be expanding our partnership with our friends at Sprott Streaming and Royalty. We view this additional investment as a strong indication of support for our ongoing development plans to increase the gold production capacity at MDN from 50,000 ozs to approximately 90,000 ozs by mid 2024 with the ongoing development of two heap leaching facilities. Further, the additional inflow of funds is expected to allow the Company to capitalize on the success at Las Calandrias and provide additional non-dilutive financing to fund our development plans".
Mike Harrison, Managing Partner of Sprott, commented, "Our continued support of Cerrado Gold reflects the success achieved at MDN to date and our confidence in the quality of the Las Calandrias heap leach project to expand the production at MDN. This funding will provide increased exposure to a well performing asset in a highly prospective region.""
https://www.investegate.co.uk/cerrado-gold-inc./rns/cerrado-gold-enters-into-financing-agreement/202303030700067522R/
From MAFL's last published accounts
Cerrado Gold: We initiated an investment in common shares of Cerrado Gold in 2019. It now represents 5.4% in the allocated investments. Cerrado is a South American gold producer with a mine, Minera Don Nicolas, in Argentina. Which mined 44,000 oz in 2021 and should mine 50,000 oz of gold. Based comparable valuations presented by Cerrado trades at around US$26 of EV per oz of Au equivalent resource, the comparable producers trade at approximately US$99 p/Oz of Au equivalent resource. Production is expected to grow by 322% over the next 4 years. In the second half of 2022 Cerrado has funded and begun development of a heap leach operation which should amplify its production and lower its all-in sustaining costs (AISC). Additionally, it is infill drilling with an aim of expanding the resource base, defining underground mining potential, while continuously working on optimizing production levels. Cerrado's second, and perhaps more exciting asset is the Monte do Carmo exploration asset located in the state of Tocantins in Brazil. The current project economic indicate, using a US$1,600/oz gold price, an after-tax NPV@5% DR of US$617M, and IRR of 99% while requiring US$126M of CAPEX. The resulting project is estimated to produce gold an average of 131,000 oz per year of gold with an all-in sustaining cost (AISC) life of mine of US$612/oz. Whilst these numbers are providing for guidance only and there is no guarantee that either these production levels or the valuations will be achieved, the Directors consider this is an exciting opportunity that they will continue to provide updates on as it progresses. Most independent analysts covering the stock have a share price target of between $2.50 and $5.50 per share.
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