Outlook for AAZ18 Dec 2020 10:44
Hi CD,
The outlook on shares like Shanta and Centamin is very clear. The problem and it has been a pain is having key staff conscripted. The quality of Gedabek ore grade is much higher underground than the open pit. Around 15,000 ounces was not accessed in Q4. The arrival of returning engineers should give that access in Q1 and so production in GEOs overall and it will be mainly gold should be around 30,000 ounces. The following quarters will be influenced by how extensive the underground ore is and none was included in the reserves and resources in the recent RNS report that only has Gedabek open pit and Gadir underground. Additionally a link between Gadir and Gedabek was being mined that contains ore.
Overall, I would expect an 80,000-84,000 annual target for production. The company has access to significant amounts of copper so gold is not carrying the whole target. What is frustrating is not having reserves and resources from 7 other deposits and not being able to add all that resource and reserve into NAV calculations. However, it is there and is likely to be over 1m ounces of gold. Hence the certainty of an 8 year production life as stated by the company. Additionally the have $31M in the bank, but we do know they need to build a second tailings dam in late 2022. Hope that helps Tony