ALK - Alkane Resources

[mullokintyre]

Buy the Rumour sell the news.
Mick

 

[Sean K]

Been a very disappointing two months. Was expecting that support around 93c to hold but $1 turned into a wall. Looking at 80c downside here I reckon. Mr Market not happy with those last Boda results. Hole 40 results pending for some time now. Overdue really. You'd assume that was drilled before 42 and 43. I'm only in this for Boda speculation so if the deposits around the NMPP don't shore up the high grade zones or expand dimensions soon it's cut and run for me.

Updated valuation from Edison with target at $1.30.

 

[mullokintyre]

Bought back into ALK.
Price seems to be turning around, as it has for a few gold miners.
Expecting some improvements in quarterly results as gold price in AUD has been up about 5% from the June quarter sales.
Mick

 

[Sean K]

Bought back into ALK.
Price seems to be turning around, as it has for a few gold miners.
Expecting some improvements in quarterly results as gold price in AUD has been up about 5% from the June quarter sales.
Mick

Came off a long way after some less than exciting drill results at Boda. The Edison valuation above assigned 61c to Boda so I think the retrace was mainly caused by that part of the value seemingly decreasing. Unfortunately, it's the only reason I'm here.

Another broker update as at 28 Sep below. Lifted target up 20c to $1.50. Ord put 42c on Boda.

 

[mullokintyre]

I look for ten to 15% in these short term trades.
hence I will be looking for an exit around the 94 or 95 mark.
Hoping that the next quarterly will give the stock a boost.
Mick

 

[Sean K]

Ann out, new Boda drilling. Huge intersections but very low grade. Too low for me. I'm out.

 

[mullokintyre]

Yeah, a bit disappointing.
The one thing I noticed was that the deeper the drill cores got, the better the grades.
But the cost of retrieval also goes up.
The gold price would have to stay higher for longer to make it a worthwhile punt.
And if that happens, there are other goldies that would benefit more.
Still, I will always be grateful to ALK for the gift of ASM.
Mick

 

[Sean K]

Yeah, a bit disappointing.
The one thing I noticed was that the deeper the drill cores got, the better the grades.
But the cost of retrieval also goes up.
The gold price would have to stay higher for longer to make it a worthwhile punt.
And if that happens, there are other goldies that would benefit more.
Still, I will always be grateful to ALK for the gift of ASM.
Mick

It's potentially open pit + UG. I think Cadia overall is around these grades (0.35g/t ish) but has some high grade areas. Cadia is about 3b tons though. I'll keep a watch to see if they can firm up the tonnage, or find a decent high grade core/area to make it worthwhile. Boda is currently (very roughly) 300x300x600=54m3. So, a very long way to go.

 

[Sean K]

ALK shooting up 20% based on today's ann. Not sure why, TBH, they've just re-drilled through what was already known by the look of their cartoon. Perhaps since it's so long since they've had any decent results new punters have seen it and went, !!!!

 

[Sean K]

Still following this puppy wondering if Boda is going to turn into something. It's hard to work out dimensions of the deposit but it is quite large but with lots of gaps and low grades. Could be one of those porphyry's (with some intrusive breccias) that is economic just due to the size. They are coming out with an initial MRE this quarter for Boda (not sure if that includes Boda 2&3 or Kaiser/Duke - so hard to guestimate numbers. I think it's just Boda) but could surprise with the total ounces, but punters may be less impressed because of the grade.

The current dimensions described by the company for Boda is 1000x400x900, but that's just the overall plan view footprint which I think includes Boda 2. Underneath it's all over the place, and the high grade area is at 600m depth. So, they may come out with an overall MRE with a smaller high grade one for the blob at depth. As a stab at the overall MRE, going by the cartoon in the last post I reckon it's actually 500x300x700 x 2.7 = 283,500,000 tonnes. I can't believe that, but that's what their cartoons indicate to me. Grades are even harder to average but looking back they're perhaps .6g/t. So, about 5.5Moz Au. I'd guess the high grade blob to be about 2M oz. And that doesn't even include the copper which is significant and I've reduced the overall footprint quite a bit. That's some quite significant numbers for just one section of the NMPP. I don't believe them.

Chart wise, it's been a turkey the past year and gone nowhere, unless you were buying and selling the tops and dips. Sitting on one of those dips now. Going to be interesting to see the numbers when they come out.

 

[mullokintyre]

Thought it may have time for ALK to have another little run up.
Took a punt on ALK again at .82 on the open this morning, but missed out.
Not really willing to chase it up, so will stay out in the meantime.
Volume is minuscule, so perhaps it was lucky I missed out, may yet drift lower, all though all my other goldies are up (bar TIE which had its run yesterday. )
Mick

 

[Sean K]

Thought it may have time for ALK to have another little run up.
Took a punt on ALK again at .82 on the open this morning, but missed out.
Not really willing to chase it up, so will stay out in the meantime.
Volume is minuscule, so perhaps it was lucky I missed out, may yet drift lower, all though all my other goldies are up (bar TIE which had its run yesterday. )
Mick

I'm thinking about it at this general support level, just because I don't think the general market realises they might be on a 5Moz deposit and the initial MRE, even just taking in Boda, might be a big surprise. But, my numbers might be way off too. It's a risk, but I suppose that's the name of the game.

 

[mullokintyre]

The name of the game is risk versus reward.
its a company that makes money, and may well do so for some few years yet.
The upside to me seems higher than the risk ( but I said that about DCN at 20 cents and look where that got me!).
Mick

 

[Captain_Chaza]

The Magnificent ALK has broken all my indicators today
Should be Plain Sailing this month and maybe even longer

 

[Sean K]

Finally get to see if the rough calculations are anywhere close.

 

[Sean K]

Crikey, double my guestimate, probably due to the low cut off and adding in Boda 2 and Cu. Gold content is about as plucked, and Cu doubles the Eq amount. Should have thought about that. Will be interesting to see how the market responds as this is quite a bit bigger than expected. Well, to me anyway.

 

[peter2]

Off market sell-down by major shareholder and Chairman. 19 Million at 0.75.
Funds required for personal reasons and possibly funding a proposed takeover of Alliance Resources (AGS).

The sell down seems to have spooked the market and the share price of ALK has fallen to 0.75.

 

[mullokintyre]

Back into ALK this morning.
I am not completely convinced that Gold has bottomed, but the capex to increase the output at Tomingley will end about the same time as the increased production kicks to increase free cash flow.
Mick

 

[Sean K]

Back into ALK this morning.
I am not completely convinced that Gold has bottomed, but the capex to increase the output at Tomingley will end about the same time as the increased production kicks to increase free cash flow.
Mick

There's still upside at the Boda / Kaiser - NMPP project. Had some extension hits recently down to 1.5km. Not sure how big it needs to get to be viable. Already 15Moz. For a low grade porphyry, maybe 20m + becomes interesting. Might need to be something like Cadia. 3Bt @ .3 for about 30Moz. Cangrejos in Ecuador is of similar grade and 17Moz AuEq that's going to be developed. So, mustn't be far off hitting critical mass.

 

[Sean K]

Some good infill results here which look like it's just going to increase the confidence in Boda, and sounds like it's going to add some ounces just north of Boda and down to Boda 2 and 3 to the next MRE due this quarter. Kaiser drilling to be updated this month.

There's a pretty good high grade core in Boda which will be important for potential development down the track. The area in the blue circle looks extremely good. Still needs to be much bigger, but looks like it could reach critical mass. Might be flying under the radar as a potential long life operation. Will be a huge capex though.

They've already got almost a billion tons @.5 g/t AuEq for 15Moz in these two deposits, would be just a pluck to guess what the next resource upgrades will bring. If they push it up to 20Moz AuEq and get some into Indicated it might get a bit more interest. Perhaps another discovery along the NMPP corridor will give it a boost.