All the Ducks25 Sep 2019 10:24
Are lining up
Numis’s coverage of Greatland Gold is a harbinger of greater things to come
Greatland's market capitalisation is now over £60mln, and it is attracting some serious support
Havieron could contain at least three million ounces of gold
It’s a significant development in the life of a company like Greatland Gold PLC (LON:GGP) when it graduates to a level that merits a 30 page analyst’s report from a broker of the calibre of Numis.
Most junior mining companies - especially ones like Greatland, which could still be years away from production – are lucky if they can garner any kind of analyst research at all.
And yet Greatland gets the full attention from Numis, and from an analyst of the calibre of Jonathan Guy no less, a man with long and deep experience in the industry, who learned his craft from the late Charles Kernot, who was himself widely acknowledged as the best mining analyst in London for the better part of a decade.
So what is it about Greatland that merits this special treatment?
The answer is simple, and comes in two parts. It’s the asset, and the partner.
At the Havieron project in the Paterson region of Western Australia, Greatland has managed to serve up mineralised gold intercepts of a quality that’s hard to come by.
A highlight in February, at a time when Greatland was still going it alone, was an intercept that measured 367 metres at 1.15 grams per tonne gold and 0.44% copper, with some cobalt thrown in.
The one potential problem was the depth, which runs at greater than 450 metres, but that’s where the partner comes in.
Greatland used its stellar drill hits to attract the attention and a serious amount of cash from Newcrest Mining Ltd (ASX:NCM), Australia’s local gold mining champion, and it’s Newcrest now that will do the heavy lifting in terms of further exploration and, potentially, development.
As it stands, Newcrest can spend up to US$65mln to gain a 70% interest in Havieron, providing it also meets certain development milestones, including the production of a feasibility study.
Where Greatland will go after that as far as financing an actual mine is concerned is an open question. But in part that’s where Numis comes in.
Numis has a long-standing history in the middle ranks of London’s brokers of supporting mid-tier mining companies in their efforts to grow larger. It’s not a bucket shop or the kind of broker that raises small tranches of cash in blocks of hundreds of thousands for juniors that are running on fumes.
As an example, it was Numis that brokered the £25mln placing that allowed Yellow Cake PLC(LON:YCA) to purchase a significant stockpile of uranium from Kazatomprom (LON:KAP) back in April.
But prior to that, Numis had acted as co-manager for the London listing of Kazatompromitself, a process which included a US$451mln placing.
So GGP are now in bed with the top company's to move us forward
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