AGREE WITH MiddleEastMoney WORKINGS15 Feb 2021 00:24
SO HOW DOES APTA PROSPECT OF 2M OZ COMPARE WITH BURITICA 11M (YES -ELEVEN)) OZ IN CONTINENTAL GOLD (ACQUIRED BY ZIJIN IN 2019)
(1) BURITICA
1) RESOURCE IN MILLION TONNES
a) Measured = 1.4 MT
b) Indicated = 14.6 MT
c) Inferred = 21.9 MT (The point to note here is inferred is nearly 1 and 1/2 times more than combined measured + indicated
2) Gold price in January 2019 = $1,278
3) AIS Costs (ASSUMED) = $800 ( I will assume the same later for PAT)
4) Margin = $1,278 less $800 = $478 per ounce
5) Profit over life of mine = 11,300,000 oz X $478 = $5,401,000,000
6) Outstanding shares in Jan 2019 = 203,000,000
7) Market value in Jan 2019 = $812 million
8) Therefore, in Jan 2019 the market value is 15% of the total future profits ( i.e. $812,000,000/$5,401,000,000)
9) Share price = $812,000,000 / 203,000,000 shares = $4 per share IN JANUARY 2019.
10) Share Price in pounds = $4 / 1.7376 (exchange rate in 2019) = £2.30.
(2) OMI - APTA ONLY 2.0M OZ RESOURCE ESTIMATE
1) Gold price in Jan 2021 = $1,800
2) AISC = $800 (Assumed same as in Continental Gold)
3) Margin = $1,800 less $800 = $1,000 per ounce
4) Profit over life of mine = 2,000,000 oz X $1,000 = $2,000,000,000
5) Outstanding shares = 187,000,000
6) Market value % as per Continental Gold = 15% X Profit of $2,000,000,000 = $300,000,000
7) Therefore Share Price = $300,000,000 / 187,000,000 shares = $1.60 per share
8) Share Price pounds = $1.60 / 1.37 = £1.17.
IF ASIC = 480 FOR SHALLOW MINING, the changes would be:
3) Margin = $1,320
4) Profit over life = $2,640,000,000
6) Market value % (ASSUMED) as per continental gold = 15% x $2,640,000,000 = $396,000,000
7) Share price = $396M / 187M shares = $2.12
8) Share price in pounds = $2.12 / 1.37 = £1.55
So, for 10M oz = £7 to OMI.
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