Gold Stocks Information and Comparison

[So_Cynical]

Now you finally might start getting the idea that labelling a company as "undervalued" isn't so straightforward as multiplying a few numbers together. You need to find out as much as you can, and find out about things you never would even have thought of before.

Apparently foster stockbroking think its undervalued as well
"i wonder if they know what there talking about...?"

Given its cash and liquid investments of ca. $26m, and the potential for upgrades
to its 760,000oz inferred resource at Koka, we believe SBS is significantly
undervalued.

and thats with a cap of $56m.

The MDN issues were badly reported and answered by the relevant minister, the following from the SBS thread.

https://www.aussiestockforums.com/forums/showthread.php?t=3360&highlight=sbs

1. MDN did
apply for the Haykota license and waited for a long
time. This is simply because the Ministry was in the process of assessing the
work programme accomplished by the different
exploration companies on the license areas that they were still holding. After
a while the Ministry had come to the conclusion that the companies needed to
invest more in their existing areas before they acquire additional licenses.
Consequently the Minister of Energy and Mines gave a written reply to MDN that
its application for an exploration licence will not
be granted and was advised to stick to its current license i.e
the Harab Suit area. It has also to be noted that
granting and/or refusing of a license application is the prerogative of the
Ministry of Energy and Mines.

2. Mr.
Becker's statement that MDN had drilled holes in the Haykota
area is totally unfounded. It has to be understood that no company is allowed
to drill or explore without a proper permit / license.

3. The
implication to give exploration licenses for Chinese companies in exchange for
arms is a totally unfounded and outrageous speculation. It is a simple logic
that no company whether it is Chinese or Western will make such kind of deals,
which is worth “billions of dollars of arms….” in an area that could be
potential but is hardly explored. We find this speculative statement
underestimates the Chinese judgment and certainly it is not the policy of the
Eritrean Government to make such kind of deals in the minerals sector.

4. Alex class=SpellE>Gorbansky was quoted to have said that “ w:st="on">Eritrea is a
risky place for any miner…”. As an analyst Mr. class=SpellE>Gorbansky is entitled to his opinion, however we would like
to make it clear that there are considerable number of Canadian, Australian,
Chinese and other companies are very keen to be granted a license. This is
hardly a sign of a high risk place to go.

We would like
to send a clear message to the existing exploration companies in w:st="on">Eritrea as well
as new incoming companies and Mr. Becker that despite the hiccups like the
temporary stoppage of exploration activities during September 2004, the policy
of the Ministry in the mineral sector is based on a transparent and solid
ground.

In conclusion
contrary to the speculation of Mr. Becker, w:st="on">Eritrea still remains a bright area
for mineral exploration and we are committed to reward all investors in the
mineral sector.

Alem Kibreab

Director General

Department of Mines

Ministry of Energy and Mines

P.O. Box 272 , Asmara , Eritrea

Tel: 002911-202889; Fax: 002911-124509

Theres no substitute for quality research.

 

[jman2007]

Apparently foster stockbroking think its undervalued as well
"i wonder if they know what there talking about...?"

and thats with a cap of $56m.

The MDN issues were badly reported and answered by the relevant minister, the following from the SBS thread.

https://www.aussiestockforums.com/forums/showthread.php?t=3360&highlight=sbs

1. MDN did
apply for the Haykota license and waited for a long
time. This is simply because the Ministry was in the process of assessing the
work programme accomplished by the different
exploration companies on the license areas that they were still holding. After
a while the Ministry had come to the conclusion that the companies needed to
invest more in their existing areas before they acquire additional licenses.
Consequently the Minister of Energy and Mines gave a written reply to MDN that
its application for an exploration licence will not
be granted and was advised to stick to its current license i.e
the Harab Suit area. It has also to be noted that
granting and/or refusing of a license application is the prerogative of the
Ministry of Energy and Mines.

2. Mr.
Becker's statement that MDN had drilled holes in the Haykota
area is totally unfounded. It has to be understood that no company is allowed
to drill or explore without a proper permit / license.

3. The
implication to give exploration licenses for Chinese companies in exchange for
arms is a totally unfounded and outrageous speculation. It is a simple logic
that no company whether it is Chinese or Western will make such kind of deals,
which is worth “billions of dollars of arms….” in an area that could be
potential but is hardly explored. We find this speculative statement
underestimates the Chinese judgment and certainly it is not the policy of the
Eritrean Government to make such kind of deals in the minerals sector.

4. Alex class=SpellE>Gorbansky was quoted to have said that “ w:st="on">Eritrea is a
risky place for any miner…”. As an analyst Mr. class=SpellE>Gorbansky is entitled to his opinion, however we would like
to make it clear that there are considerable number of Canadian, Australian,
Chinese and other companies are very keen to be granted a license. This is
hardly a sign of a high risk place to go.

We would like
to send a clear message to the existing exploration companies in w:st="on">Eritrea as well
as new incoming companies and Mr. Becker that despite the hiccups like the
temporary stoppage of exploration activities during September 2004, the policy
of the Ministry in the mineral sector is based on a transparent and solid
ground.

In conclusion
contrary to the speculation of Mr. Becker, w:st="on">Eritrea still remains a bright area
for mineral exploration and we are committed to reward all investors in the
mineral sector.

Alem Kibreab

Director General

Department of Mines

Ministry of Energy and Mines

P.O. Box 272 , Asmara , Eritrea

Tel: 002911-202889; Fax: 002911-124509

Theres no substitute for quality research.

Like I said b4,

It's your money and you can do what you want with it.

If I was you I'd be asking questions of people who actually work in the industry and trying to learn what is actually involved in getting a mine off the ground, rather than wasting your time worrying about what Mr Alem Kibreab tries to confirm or deny.

But hey, I guess some people know everything about everything.

jman

 

[jman2007]

This confuses me no end. People who chase gold hopefuls atm have no real need to take such risks. Juniors with proven resources sit there waiting for the re-rating with sound resources sometimes cheaper than explorers with only drill samples and huge risk. Grade is a very misunderstood concept from my little knowledge on the subject. I think many look at average grades of say between 1.5g/t and 2g/t and do not like so rush to buy a company that publishes higher underground drill results that look far sexier. However the shallow lower grade deposits are the success story of gold mining in Australia from what I can tell. I see no proof underground mining has cheaper costs, in fact seem to have more issues/costs/problems.

Mind you if drill results indicated high grade shallow deposits then worth a punt but how often does anyone find them? Seems odd to want to gamble on such a find when sound, very probably ecomomic resources are so under-valued atm and far less riskier. If POG and junior re-rating takes off these will be multi-baggers. Meanwile some will still be waiting on drill results.

You're pretty much on the money Spag,

A shallow open pit operation will invariably run into less problems than a complicated underground setting, and be far cheaper (well most of the time). The shallow multi-100K oz deposits are also getting harder and harder to find. Take the Lancefield deposit for example, just outside Laverton WA. Probably close to 500,000 oz remaining in the ground, yet if you visit the pit the most action you're likely to see are a few stray roos and goannas. The problem being that the deposit is probably close to 20 levels underground with significant amounts of water to boot.

jman

 

[refined silver]

Goldfields Ltd (GFI) SECOND QUARTER FISCAL 2008

Operating profit of R2 billion and net earnings of R1.9 billion in the quarter ended 31 December 2007

JOHANNESBURG. 31 January 2008, Gold Fields Limited (NYSE & JSE: GFI) today announced net earnings for the December 2007 quarter of R1,938 million, compared with restated net earnings of R429 million and R767 million for the September 2007 and the December 2006 quarters respectively. In US dollar terms net earnings for the December 2007 quarter were US$281 million, compared with restated earnings of US$60 million and US$104 million for the September 2007 and the December 2006 quarters respectively.

December 2007 quarter salient features:

- Attributable gold production, of 960,000 ounces 3 per cent lower than the previous quarter;

- Net earnings and normalised earnings increase by 350 per cent and 48 per cent respectively;

- Sale of Essakane and Venezuelan assets successfully concluded releasing R4,174 million (US$615 million) in value;


For complete details please go to
http://www.goldfields.co.za/reports_quarterly.asp?navDisplay=Reports

This out today from 4th biggest gold miner in world. Net profit up 350% (4.5times). By my calcs gives them a PE of under 10. When PEs in this sector can go from 40-50 to 10 in 1 qtr, this qtrs earnings reports might be the catalyst for gold shares to finally get going and play catch up to the price of gold.

 

[jman2007]

Evening folks,

Been a bit quiet on this thread as of late. Cheers to everyone for their input recently, which has raised a lot of interesting questions and provided some answers. Went along to the RIU Explorers Conference 2008 in Fremantle earlier this week for a day. Some interesting presentations from some aspiring Au mining and exploration companies, although I have to admit, I found it tough to get too excited over many of them.

I think one thing that has become clear on this thread is that it is very hard to put a "value" on exploration upside for a particular company, since exploration is all about managing exposure to risk. At the same time, this is probably where the true multibaggers are likely to come from. For my money, I have been researching a lot of near-term producers, and companies already in production to try and determine a good value stock, and lower my risk profile.

Looking at a few Aust companies from an operational perspective, I was surprised that I discovered what I percieved to be a higher-than-expected risk exposure: (not an exclusive list obviously)

- Monarch Gold (MON):

Broad resource base, but operational issues at Davyhurst mill which recently required another $10M for "continuing development". Current costs 977/oz. Potentially will be placed under excessive financial strain with recent Mt Magnet aquisition. Targeting 500Koz pa within 1-2 years, but recent cap raising proving difficult. Low cash reserves, significant shareholder dilution.

- Regis Resources (RRL):

No milling facility, capex of $148M for construction. Acquired Duketon area from Newmont, who in return acquired a significant shareholding. Resource base of 2.8M oz, but modest grade of 1.15g/t. Running low on cash ($1.5M), and question marks imo over whether Moolart Well (1.5Moz) could ever be economic at 0.84 g/t. Will likely require a JV partner to cover development costs.

- Citigold (CTO): Undervalued at 37c?? (Needs a t/a)

Recent operations constrained by power supply problems through the grid, reasonably impressive underground costs of $544/oz at 9.7 g/t during Dec quarter. Geological complexity possibly creating difficulties in resource definition and modeling? With power supply upgrade could ramp up production to 100Koz pa in 2008. Likely that a $50M share placement will be required for continuing expansion.

- Integra Mining (IGR) - THE PICK OF THE BUNCH FOR ME!

IGR really stand out for me. Global resource base of 1.6Moz @ 2.6g/t. The clincher for me though is that they have 100% ownership of a gold processing facility!! Refurishment to be carried out this year. What I have heard about their management is positive, their MD, Chris Cairns (no relation to ex-kiwi cricketer) seems like one of those guys who have a knack of making things happening. He has a economic geology background which is encouraging (I always get worried when I hear that a lawyer or accountant is running a resource company).

Crucially in these times of tightening credit markets, IGR are well cashed-up, with $30M or so in cash reserves and a reasonably tight capital structure (352M shares on issue). That could make all the difference between a fully-funded year or two of exploration and mill refurishment, and having to go to the market for funds leading to more and more dilution for current holders, as is happening to many companies. The depth and extent of drilling at the recent Salt Creek discovery (currently 250,000Koz @2.7g/t) is impressive, it suggests to me that these guys are serious about their exploration and have a good understanding of what it takes to drill out a known ore body and unlock the geological puzzle.

The Salt Creek prospect, at a first pass, looks like a cracker of a discovery, and with global resources of 1.6M oz at a decent grade, a 100% owned mill ready to be refurbished, significant exploration upside and good cash reserves, I'd be keeping IGR on my watchlist for sure. Salt Creek could turn out to be one of the more significant discoveries in recent times.

Logically, with potential continuation of exploration success in 2008, and with a successful phase of mill refurbishment this year, you could realistically expect a re-rating of the IGR sp to occurr. Currently 44c, it may not turn out to be a multibagger, but the fundamentals here are looking exceptionally good.

Cheers
jman

Disclaimer: I DNH any of these stocks. Do not take my advice as financial advice, as I am merely expressing my opinion based on available market information.

 

[So_Cynical]

Hey jman
I see u have been looking at the same company's that have interested me lately.

Re: Citigold and this comment..Likely that a $50M share placement will be required for continuing expansion.
wondering where u got that info from as that would be the last nail in the coffin for
many holders...even id sell at a loss it they do that....and then smite them...

U know CTO shut there mine for Xmas... what the hell sorta mine closes for Xmas :bs:

Its very hard to get to exited by miners with operations in Aust

 

[jman2007]

Hey jman
I see u have been looking at the same company's that have interested me lately.

Re: Citigold and this comment..Likely that a $50M share placement will be required for continuing expansion.
wondering where u got that info from as that would be the last nail in the coffin for
many holders...even id sell at a loss it they do that....and then smite them...

U know CTO shut there mine for Xmas... what the hell sorta mine closes for Xmas :bs:

Its very hard to get to exited by miners with operations in Aust

Yes, I'm also finding it exceptionally difficult to identify good Au plays atm,

Re the Citigold comment, I read in the "Citigold outlook 2008" announcement released on the 19/12/2007 that (quote) "Raise significant commercial funding, estimated at $50 million, to accelerate development with minimal dilution of existing shareholders" was specified as a financial objective for 2008.

Their capital structure already looks a little bit loose...something like 650M shares on issue atm?

Lol, no I never knew they were closed over Xmass. They're either extremely confident in their 2008 outlook, or they got sick of using candles to see what they were doing underground.

jman

 

[jman2007]

Hmm well I dont know where this ranks but I'll mention the info I can find (2006 Annual Report)

Resolute Mining (RSG)

Markt Cap 343Mil
Ordinary Shares - 229 124 559
Unlisted Options - 3 687 500
Current share price - $1.48

Yielded 290 000 ounces of gold @ A$518/ounce
In the 06 report RSG forecast 300,000 ounces @S$570/ounce for the next financial year

Mining in Tanzania,Mali, Ghana, and Australia.

I believe the Syama mines comes online next year adding a significant amount of gold to their resources.
I'm unsure of hedging.

Go Nuke,

Thanks for bringing RSG to the fore mate, although I am kicking myself for not looking into this company more at the time, it's run pretty hard since late 07, from 1.60'ish to around 2.50 currently.

Still learning about RSG, so any additional info would be welcome. They appear to have a sizeable resource base of 11M oz and ore reserves of around 3M oz. RSG currenty working towards bringing the Syama project online in Mali, at first I was a little sceptical when I read about this. However, Africa is no place for wimps, and if you're going to get a project happening in this part of the world, make sure it's bold, and make sure it's big.

Well that's what these guys seem to be doing, Syama has resources of 6M oz, Resolute earning 80%, Mali Govt 20%. Hoping to begin mining the oxide cap 1H 2008, and targeting a 10+year mine life. The plant construction looks to be well advanced, with the grinding mills looking like they are in place, ready to be commissioned.

Go Nuke, as far as I can make out, RSG will begin a gradual hedging unwinding strategy over the next 2-3 years, and by 2011 will almost be hedge-free.

Ken, the cash costs at the Ravenswood operations were in QLD were running at approx. $781/oz during 06/07, so yep, probably some indication of issues with the underground ops there, any additional info welcome.

The Mt Wright development looks to be progressing more or less to plan, two stopes developed so far and metallurgical testwork showing good plant recoveries. 650K oz could be mined from Mt Wright, the $340/oz target looks to be a bit a little over-optimistic imo, but they could easily know something I don't.

This is another reason why I'm begining to pay more attention to African miners, particularly in West Africa. While Australian companies are struggling with staff shortages, modest grades, smaller resources and high costs per ounce, many newly explored Archean belts in Africa are fast turning into potential multi-million ounce projects in their own right. I more or less agree with So Cynical that the Australian gold sector is not looking particularly alluring atm.

Any comments welcome. DNH
jman

PS Also some other projects in the works down the East Coast of Africa that I haven't touched on here.

 

[jman2007]

Watchlisted these goldies atm,

IGR: New support level above 50c, looking for entry point if this comes back below 47-48c

CGX: Sold out at 2.18, currently some resistance at 2.18-2.20. Due to recent upsurge, potential for profit-takers to come out of the woodwork very quickly.

RSG: Been in an uptrend since late 07 and recently peaked at 2.49, currently trading at 2.24. Unsure where support levels would be for this one, but looking for an entry.

PRU: (Hold) Bought in on the drop at 1.20, chartwise looks a little bit tenuous atm, potential for resource upgrades at Ayanfuri and Grumesa to provide further triggers however.

jman

 

[Sean K]

Revised basic comparison here.

Any changes to this please let us know.

Any additions, post them up.

Thanks to those adding the great information above esp Jman.

Doc attached.

Cheers.

 

[SGB]

Revised basic comparison here..

Nice work kennas

cheers

SGB

 

[JTLP]

Kennas I think YT will be very disappointed you did not put MXR into the producers...with there massive JORC and all...:

 

[grace]

NAV have had a jorc upgrade to 950 000 oz at a grade of 2.1 - cheers and thanks for doing this!

Some 200 assay results due to come in very soon....

 

[Sean K]

Kennas I think YT will be very disappointed you did not put MXR into the producers...with there massive JORC and all...:

I'll try and fit it in. More to come you'd expect.

NAV have had a jorc upgrade to 950 000 oz at a grade of 2.1 - cheers and thanks for doing this!

Some 200 assay results due to come in very soon....

Done, thanks. Keep us posted on the next assays and likely impact.

 

[So_Cynical]

Hey Kennas

SBS had a Resource increase to 1.04 million ounces of Gold at there Zara project, Koka deposit
(Eritrea)...so there total across 3 projects would be over 2 million Oz.

Also id like to add EVG - Envirogold to the list.
Market Cap:......23,751,569
Issued Shares:..197,929,744

EVG is due to start production in the first Q of 09 at there Las Lagunas project in the
Dominican Republic....its a tailings project using the ALBION process to recover the
gold and silver, with out the acid downside.

Indicated JORC Resource for Las Lagunas is - 5.137mt @ 3.76g/t Au & 38.62g/t Ag
for a total of, Gold 435,000 & Silver 3,974,000 Oz recoverable.

EVG also recently announced there intentions to go underground at the (closed since 84)
Huancay gold and silver mine in Peru.

EVG thread below
https://www.aussiestockforums.com/forums/showthread.php?t=7127

 

[sleepy]

Forgive the dumb question ... but is there only a handful of actual gold (and silver) PRODUCERS on the ASX? Ive been trying to find a definitive list of all the producers, and junior producers on ASX but not having much luck.

I did find this though. Hopefully it will be of interest:

http://www.globalspeculator.com.au/documents/Newkidsonthegoldblock.pdf

sleepy

 

[So_Cynical]

Forgive the dumb question ... but is there only a handful of actual gold (and silver) PRODUCERS on the ASX? Ive been trying to find a definitive list of all the producers, and junior producers on ASX but not having much luck.

I did find this though. Hopefully it will be of interest:

http://www.globalspeculator.com.au/documents/Newkidsonthegoldblock.pdf

sleepy

Its surprising how few there are...Aussie miners producing in Aust.

Theres at least 1 foreigner producing here and dual listed here IAU
and another foreigner, listed here but producing in NZ OGC
and about a dozen Aussies producing only overseas including TRY LGL CNT
KCN (CGX producing?)...mmm ok about a half dozen producers and about another
half dozen near producers...including ALD MDL EVG etc

I'm sure theres a few ive forgotten about.

 

[refined silver]

Forgive the dumb question ... but is there only a handful of actual gold (and silver) PRODUCERS on the ASX? Ive been trying to find a definitive list of all the producers, and junior producers on ASX but not having much luck.

sleepy

As close to a definitive list as I think you will find. Broken down into large producers, small producers, development stage, and large and small explorers.

http://www.goldoz.com.au/stocks.0.html

 

[jman2007]

Some great work here Kennas,

We'd probably have to go a long way to find a more comprehensive and informative list, other than external links etc. It's no small task capturing all this data and presenting it in a understandable format. There is a good mixture of greenfields exploration and fully-fledged producers here.

jman

 

[Sean K]

I have updated the spreadsheet with additional information on many of the companies and updated with their recent significant results. Doc is too big to paste up in the thread, so you will need to open it up as a file.

Any additions, please advise if you like, but include as much information as possible:

Shares on issue
Current SP
Resource base
Grades

etc etc.

Cheers,
kennas