The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
"In March, over 8,200 ounces of gold was produced which included the start of the drawdown of the gold in circuit. We look forward to maintaining an increased level of production for the remainder of the year in parallel with continued drawdown of the gold in circuit.
"We are pleased to have made a significant payment of US$8.2 million towards our outstanding senior debt facility, leaving a balance of US$15 million. We remain on track to fully repay the facility this year.
Probably Debt free by end of Q3 if production at the rate in March (8,200 oz) is sustained and gold stays at these levels
The stock, up 37% in the year to date, advanced a further 5.5p to 64p. Peel Hunt reckons there is further to go for the share price as it set an 80p target and reiterated its 'buy' advice.
"We are now beginning to see the fruits of Serabi’s development work at Coringa, with the new GUIA trial mining licence providing the comfort of three more years of operation on site," said the broker in a note to clients.
"We believe the market continues to underestimate Serabi’s value proposition, especially the increase in mine life and the efficiency impact of the new ore sorter at Coringa."
An interview with Mike Hodgson, CEO by Crux Investor can be accessed using the following link –
https://youtu.be/8ez5vVY2Fz0
An interview with Mike Hodgson, CEO by BRR Media can be accessed using the following link - https://www.brrmedia.co.uk/broadcasts-embed/661d1cd8591bc168ede76734/serabi-gold/?popup=true
Bushy. Your 3 recent posts here all suggest you are short.
55p? Doubt it. 60p has been the floor after 71p last week with the sp bouncing back.
Over priced? Based on what? 75 million shares x 62p is £46 million Mkt Cap. Generating $800 x 40k oz = approx $32 million free cash flow this year.
Worth a quarter billion? 75 million shares x £2 is £150 million. Your maths are about as washed up as your analysis!
Buyers returning after the over done sell off of the past 2 days on the Vale news which is peripheral to Serabi's main business of gold production . With hindsight it might be seen as a good thing to have the news out of the way ahead of Q1 production results which should be very encouraging (10,000k oz?) and getting the year off to a good start with much improved cash flow and confidence in the ramp up in production this year/next year.
Q1 production results last year were 19/4. This time around we are expecting to do better with gold production incl a higher contribution from Coringa where more development has taken place over the past year.
Cash was $11.6 million at EoY (net cash $5 million) and should benefit from the higher gold price but there was a $5 million bank loan due for repayment in February so the cash figure may be similar unless a replacement loan was taken out during the quarter. This year the company should be throwing off decent cash with gold $2200 plus.
HIGHLIGHTS
First quarter gold production totalled 8,005 ounces, a 13% improvement on the corresponding quarter in 2022.
Plant feed grades were the highest since the third quarter of 2021, benefitting in part from higher grade ore from Coringa.
The Coringa mine development continued to progress well with the high grade portion of the ore being transported to Palito and contributing over 2,200 ounces towards the first quarter total.
Cash held at 31 March 2023 was US$13.2 million.
We are currently carrying out our preliminary feasibility study workstreams at the Douta Gold Project and look forward to now completing this during Q3 2024 following finalisation of the process flow sheet.
"The acquisition of the Douta-West permit, which has a number of geochemical targets, allows us to potentially add scale to the Douta Gold Project, in particular, extensions to Makosa Tail. We look forward to commencing exploration on this new permit with our existing exploration team and from our exploration camp at Douta.
Yes, Douta PFS has slipped again from Q4/23 to Q3/24 now. Issues:
There was to be a new MRE issued in Q1 as well that we have not seen. It seems drilling is continuing to increase oxide share of the resource to improve economics but now there is this new Douta-West licence that they want to drill and possibly add in some resource if drilling there is successful.
Development of the mining process has been done with the Chinese and finalisation of the process flow sheet is said to be under way.
Extra time has been required for detailed metallurgy work in Perth which feeds in to the process design. All this is extending the time for finalisation of the PFS.
Major issues are with the cost of development of this deposit. The initial resource of expected c.2 million oz gold is in oxide, transitional, sulphide and refractory form. A CIL processing facility for the oxide component would be suitable to start off but the majority of the ore will require much more expensive treatment facilities incl a $200 million? BIOX. Note. Endeavour has had to install a BIOX for the similar Massawa ore adjacent to Douta after initial processing of some of the oxide material.
These high grade (incl 30gm/t), reasonably shallow depth drill results from Kola indicate that there is a potential resource here that is well suited to trucking to Segilola to extend mine life. Further drilling here is likely this quarter.
The greenfield discovery at Kola located 23km to the south returned several high-grade encouraging drill results and has opened up a new front of exploration potential to the south, an area which is now of priority.
Drilling during Q4 2023 returned encouraging high-grade intercepts, including at the Kola Prospect:
o SGRC188: 4 metres at 30.2g/t Au from 14 metres
o SGRC 189: 8 metres at 3.0g/t Au from 56 metres
o SGRC 190: 7 metres at 26g/t Au from 49 metres
o SGRC 194: 7 metres at 34.2g/t Au from 49 metres
o Previously unreported drilled in Q4 2023
o SGRC 236: 2 metres at 12.61g/t Au from 49 metres
o SGD 295: 5 metres at 11.25g/t Au from 15 metres
o SGD 296: 3 metres at 2.49g/t Au from 55.5 metres
HarChris. No one knows what resource lies at depth at Segilola because no drilling has yet been done. But the gold in the open pit which they are mining has come from somewhere. If that somewhere lies below the pit then only by this new drilling will Segun or anyone else be able to quantify it.
It's likely significant gold resource will be discovered beneath the open pit with this first ever deep drilling at Segilola due to start this quarter. If the drilling proves up another 300k oz at a decent grade this would add a further 3 years to the mine life without taking into consideration potential resources being drilled at satellite deposits within trucking distance of the mine.
Initial budget of $4 million for 2 rigs deeper drilling near the pit and another rig for satellite prospects near mine. Results will be given out from Q2 onwards.
Watch for these drill results as they come in.
In themselves they could near double the valuation as the discount for a perceived short mine life is removed.
Canaccord: A further 5p to be added to the valuation per year of mine life extension (1-2 years expected) from Q2 drilling.
Serabi sp consolidating above 60p with momentum being maintained and firm support from the improving company outlook and gold price now $2197.
The 3 year chart shows a 'W' formation with the trend reversal well established with current prices last seen 2.3 years ago in December 2021.
Look for confirmation in Q1/24 production results due in about 4 weeks time.
Colinzeal. 10k oz of 2023 production was in circuit from 2022 production. Carried forward into this year. The plant modifications made in H2/23 will allow draw down of some of this in 2024 production. Segun is very conservative in his statements but to me it seems likely that production this year may be above 100k oz.
Segun interview 21/3/24.
https://www.youtube.com/watch?v=J6IHr1AxehQThor Explorations, a West Africa-focused gold producer, is poised for a pivotal year in 2024 as it looks to capitalize on strong production, significant cash flow generation, and exploration upside.
The company is guiding for gold production of 95,000 to 100,000 ounces this year. This production profile is expected to drive robust free cash flow generation, which will be used to strengthening the balance sheet. Thor expects to fully repay its $22 million in debt by the end of 2024, with large debt repayment already at the end of March of $8 million, leaving the company with a clean balance sheet and strong cash flows to fund growth initiatives.
A key focus for Thor is extending the mine life at Segilola through exploration drilling. The deposit remains open at depth, providing potential to expand resources and reserves to support a larger open pit operation or a future underground mine. Thor is mobilizing two drill rigs in Q2 to test these deeper targets, with another rig allocated to explore near-mine satellite deposits. The geology of the area is highly prospective and provides meaningful upside to the company's production and cash flow profile.
At Thor's Douta Gold Project in Senegal, the company is awaiting the results of a preliminary feasibility study (PFS) that has been delayed due to additional metallurgical testing. However, oxide material has shown strong recoveries and will be the focus of a drill program in Q2 aimed at enhancing the project economics. Once the PFS is delivered, Thor plans to rapidly advance the project to a definitive feasibility study to support a construction decision.
The company is also resuming its lithium exploration efforts in Nigeria, with drilling set to commence in Q2 following a comprehensive target generation program. The drill program is expected to generate steady news flow and has the potential to define a significant lithium resource.
With a market capitalization of approximately $95 million, Thor trades at its expected free cash flow at current gold prices. This represents a compelling valuation for a growing gold producer with a strong balance sheet and meaningful exploration upside. As the company delivers on its operational and exploration objectives, there is potential for significant re-rating of the stock to better reflect its fundamental value.
In conclusion, Thor Explorations offers investors an attractive opportunity to gain exposure to a growing West African gold producer at a deeply discounted valuation. With a robust production profile, significant near-term cash flow, and multiple avenues for growth, the company is well-positioned to create value for shareholders in 2024 and beyond.
As per yesterday MM's have no stock so you can't buy in size or at all. All their stock was gone after just a few minutes this morning and no sellers.
I don't know where they can get stock as it's a tight market compounded by gold going $2200.
Segun has just 3 weeks to deliver the updated MRE for Douta and PFS where guidance was put back from Q4/23 to Q1/24. It's likely the company has been working hard to complete these significant reports without further delay.
So with 10 weeks of the quarter already gone, will we see the MRE this week opening the door for the PFS to follow?
Traders may think they can sell here and get back in cheaper. But they might lose their position as gold is still going up and might continue going up for weeks as it has been suppressed for so long. Gold $2165 has broken out and is at an ATH with $2500 not so far away.
Yes, the State hydro power supply is coming to Palito which will replace diesel for power generation which is Serabi's second highest cost after labour. Then the electric supply will be going in to Coringa. This will reduce AISC for the company by a significant amount. AISC of $1400 is expected giving a $600 margin per oz with gold at $2000.
Road from Coringa to Palito has been recently paved which makes trucking of ore to Palito quicker and a lot easier.
Palito production of 30k oz can go on for however long! 400k oz resource 20 years ago. That has been mined and now the resource is 500k oz which is the most it has ever been.
Coringa is similar. It could be a 1 million oz resource with grades 10 to 12 gm/ton. Production could be up to 70k oz pa to get production to 100k oz organically but that would require capex that is not available currently.
Ore sorter for Coringa is on the water from Poland heading to Brazil.
Segun in 2011 acquired shell company, TSXV listed, Thor Explorations and became CEO at the age of 32. The business had a mine site in Senegal and not much else. Fast forward to today when Thor has a 100k oz pa mine at Segilola in Nigeria that started construction n 2020 and is now in its 3rd year of production. In a few months it will be fully paid for, debt free and throwing off mega cash. LIsting on AIM came in June 2021 as mine construction was nearing completion.
The Senegal project is still there but exploration has proved up nearly 2 million oz gold so far with an MRE due now and a PFS due by end of this month. And there is likely to be much more resource when exploration over a 30 km trend comes to bear. Recently there has been acquisition of large acreage gold and lithium leases in SW Nigeria with promising early drill results.
Share price. C$0.22, 13.5p. For the last 7 years the sp has been in the range of c.14c to 40c but is recently off a low of 17c. The sp is around the lows for the past 3 years and half of the highs of 40c. Almost no reward for so much company development and transformed finances.