DCN - Dacian Gold

finicky said:

Another 10,000 added today @ 0.35 from an order I made overnight. Didn't bother to amend it for the gold price dip. Good value as long as Leigh Junk continues to right the ship. At least he buys share of his own company on market, not like most free loader directors. Gold price will come back hard at some point imo.

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Been watching for a while, think tomorrow might pick up a few. Being Friday maybe get slightly lower. However picked up some physical bullion also today so overall getting bullish on gold

@againsthegrain My attitude is, if I believe in gold's future I should buy into strong corrections. If had the patience I would wait for chart confirmation of reversal and lose something off the bottom but I get restless and buy if a 'good' company looks a possibility of bottoming. The value seems there already with the caveat that you never fully know what will happen with a gold miner and that's more the case if the miner has past issues under different management to overcome - like Dacian. Encouraging reversal in DCN so far today in the context of the under performing gold sector.

Picked up 5000 shares today, see what next week brings if the market is red might be a opportunity for another 5000 otherwise hold for a while. Gold down, asx down, I see it as a good opportunity... for myself of course

Seems good time to accumulate. Good opportunity this morning, I considered biting. Compared to me your timing is immaculate

finicky said:

Seems good time to accumulate. Good opportunity this morning, I considered biting. Compared to me your timing is immaculate

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I never get the timing right, just a fluke clicked to buy at 33.8 on market but put in wrong pin, by the time I figured out my error and right pin got in at 33.5... see what Monday + next week brings im long on gold miners + physical so doesn't faze me

I'm not sure where the upside here is? Just POG or something in the exploration? Chart doesn't look very exciting TBH... Some support around 30-35 cents, but then what?

Signed, sealed, delivered (on the 17th)
Feels like a greatly strengthened company now.

If you're interested in why I have been buying DCN, its mostly back in the thread. With this post, being I've been questioned, I'll try to sell it. But I'm not really wanting to do that - I just get more energy from a 'sell it' approach. Gold stocks are never safe.

Dacian is situated in the Laverton/Leonora 'terrane' which has historically produced 50Mn ozs of gold. Somewhere in the past I read that Dacian's Mt Morgan mine is situated in the midst of a proximate region that has produced a greater density of multi-million oz gold deposits than anywhere else in Australia: Sunrise Dam >10Moz, Wallaby >8Moz, Granny Smith >2Moz, Lancefield >2Moz and Westralia and Jupiter themselves, belonging to DCN, each >2Moz. I think you can throw in Sons of Gwalia, Thunderbox (SAR) and Darlot (RED) which I believe are somewhere in the wider region too.

On Friday they announced the W.A supreme court ratification of Dacian's takeover of NTM Gold, which company will be removed from ASX quotation on Mar15. NTM Gold own the Redcliffe tenements which control 40 kilometres of mineralised shear zone along which NTM have already identified a string of shallow deposits on 21 kilometres of strike. The tenements are within trucking distance of Dacian's new Mt Morgan ~3Mtpa plant.

NTM Gold has just finished infill RC drilling a substantial area of the 'Hub' deposit on a 25 x 25 grid down to around 100 metres and are now diamond drilling to "complete the pattern" down to 150 metres. They know that mineralisation occurs down at 500 metres and the deposit so far has 1.2 km of still open strike. Width, to be frank I don't know yet, but management of both merging companies obviously have no doubt it is a close to surface open pit mineable deposit and the $100m plant for it is of course already built at Mt Morgan.

Here again are some of 'Hub's' good infill grades but the whole oxide and transitional part of the deposit is high grade for the purpose of an open pit project:



Regarding the chart, it has been disappointing lately and the positive momentum and apparent pattern building over 9 months has been swiftly undone in the general gold dumping. I reasonably choose to believe this is not a decline related to an issue specific to DCN. There're plenty of gold stock charts at least as bad out there over the last 6 weeks - e.g check out NST, NCM, RRL. There is very solid support for DCN down at 0.30 but I'm not expecting it to get down there myself. However, there will be a whole lot more liquidity come into the stock starting Wednesday week, March 17, when ordinary ex NTM shareholders front the market with their replacement DCN shares and admittedly, I don't know how they'll behave.

This is a company already making profit you know, with its own mill, bringing second party stranded prospects into play and with many exploration prospects of its own - double those now with the NTM Gold merger.

2 year weekly
Price hasn't broken the prior low yet leaving a series of higher lows and higher highs intact so far.

A few smallish news items about DCN:

so far so good, doesn't look like any major dumping from ex NTM holders to drag the price down

Will be ok, we'll make money on this with patience, it is a good play on a resurgent gold price when it happens, Jmo.
It's not over yet as to what NTM shareholders will do and there's still the S&P/ASX 300 rebalancing to get through (Mar 22). Might breeze through it all.

finicky said:

If you're interested in why I have been buying DCN, its mostly back in the thread. With this post, being I've been questioned, I'll try to sell it. But I'm not really wanting to do that - I just get more energy from a 'sell it' approach. Gold stocks are never safe.

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I've had a better look through this and NTM and can see the upside here. I didn't realise the added value and potential of 1m+ extra ounces to be driven up the road to Mt Morgan. $200m MC with 2.7m oz turning out 110k pa looks pretty cheap at the moment. Their AISC looks pretty high compared to others though.

DCN have been a perennial dissapointment in their execution to date. The NTM merger is probably their last chance to prove they can execute. I certainly wouldn't have touched them again without the merger.

The honeymoon period for Leigh Junk (Managing Director appointed Jan 2020) is now well and truly over and any failure to execute this time can't be blamed on the previous management.

Notwithstanding, the NTM merger is a big lift for them if they do manage to get it right.


@kennas nice to have you back posting again, your insight into resource stocks has been sorely missed.
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Well, they're making money at this gold price and I wouldn't be buying any gold stocks if not anticipating a much higher gold price. It's a trade-off, cheaper gold miner in compensation for temporarily higher than average AISC and a bit more than average uncertainty.

H1 production result at Mt Morgan was 59,961oz at an AISC of $1,356/oz

Guidance of 110,000-120,000oz at an AISC of $1,400-$1,550/oz maintained by Dacian for FY21.

Northern Star for one comparison is guiding AISC A$1,390-A$1,520/oz for FY21
Regis Resources is maintaining FY21 AISC guidance at A$1,230 - 1,300 per ounce

And look forward to lower AISC when ex NTM's 'The Hub" high grade open pit ore comes on line, maybe early cal 2022?

As mentioned, Monday DCN will officially drop out of the S&P/ASX 300 but going by Friday's movement I suspect most of the index bound selling has already been done. We'll see, I'm certainly not knowledgeable about such machinations.

Daily chart showing highest volume in 5 months for a candle that closed on its high. Plenty of overhead room for the momentum indicators.

Back down to an intraday ,ow of 0.325 today; I have a bid in for 10,000 more @ 0.33
Maybe I'll get pie in my face but still reckon this year has been a gift of an opportunity to accumulate gold stocks and this seems high potential for the price. As already discussed, there's a possible weakness factor in the shares for a while as the ex NTM shareholders distil down into those who want to commit to the newly merged DCN/NTM.

For another opportunity I am watching Northern Star (NST), a top 10 global gold company now, after the merger with SAR and just a fabulous opportunity for goldbugs I believe as it possibly heads down to around $9 again. Got a decent franked dividend from them a few days ago too??

finicky said:

Back down to an intraday ,ow of 0.325 today; I have a bid in for 10,000 more @ 0.33
Maybe I'll get pie in my face but still reckon this year has been a gift of an opportunity to accumulate gold stocks and this seems high potential for the price. As already discussed, there's a possible weakness factor in the shares for a while as the ex NTM shareholders distil down into those who want to commit to the newly merged DCN/NTM.

For another opportunity I am watching Northern Star (NST), a top 10 global gold company now, after the merger with SAR and just a fabulous opportunity for goldbugs I believe as it possibly heads down to around $9 again. Got a decent franked dividend from them a few days ago too??

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Opportunities are never seen until they are gone, I picked up some physical bullion today, 250 fmg shares yesterday so bit exhausted for now, nst would be next on my list, perhaps next week. Still holding dcn

Even the drop-kick gold companies are up today, are fortunes reversing? Dacian (DCN) is popping above its short term downtrend from January (first chart) and the gold stocks etf, XGD, has moved outside its downtrend line from August, put in a higher high, and faster moving average (20) is crossing slower ma (50). Smell of napalm.

DCN daily



XGD Daily

finicky said:

Even the drop-kick gold companies are up today, are fortunes reversing? Dacian (DCN) is popping above its short term downtrend from January (first chart) and the gold stocks etf, XGD, has moved outside its downtrend line from August, put in a higher high, and faster moving average (20) is crossing slower ma (50). Smell of napalm.

DCN daily
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XGD Daily
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I thought we established weeks ago in the Regis thread that the correction was complete? Shorts were squeezed?
I don't believe it will help with a sustained push for this dog to be honest. Too much history.

Needless to say it was a disappointing March Quarterly report, I could only bear to skim it. My attitude remains to hold with patience. I am looking well ahead to mining the assets of NTM Gold and exploration success. Also likely revival of Westralia underground - technical report with new mineral resource estimates coming in early May.

Cash and gold on hand went down significantly with a couple of hopefully one-offs in play. There was a planned maintenance shut down, some mining personnel shortage caused lower ore movement. There was temporarily lower grade and recovery of gold from ore. Pre-stripping of a pit (Doublejay) increased costs too. Significant exploration/growth spend of $19M and $2M repaid in debt.

They've attracted more mining personnel and have mobilised more heavy equipment. Doublejay pit will come increasingly online after the stripping exposes high grade ore blocks.

They've maintained annual guidance, so are confident of a stronger June Qtr
It's a candidate for me to add if it gets silly low in price, which could happen in the short term.