As I said SLR has a lot of looming costs which will gobble up profits it may make from Daisy Milano. So (if we're going to be cross promoting) I'm more interested in buying stocks like ETC which has a much brighter future.
Reality is CTO a cash strapped junior may indeed not be able to progress this massive project. Big projects like this require huge development costs ahead of production... CTO may need to finally see the writing on the wall and give up if it can't hit the targets it has set for itself in the latest quarterly.
So ..
Bottom line is how much would a company like Lihir, Barrick, kinross, Newmont, Newcrest etc.. pay for CTO if it gave up? Comapnies that have the cash to quickly develop this project to its full potential ?
Remembering CTO
- has property plant and equipment of $227 mill - has a 10 mill oz JORC resource - is in a town centre - has all the necessary infrastructure - is connected to a power grid - has potential for a 30 year mine life at 300,000 oz/annum - cash costs to head down to a low AUD$350/oz (USD$250/oz) ? - potential for a $200 mill plus gross profit ($150 mill plus NPAT) at the current gold price.
Remembering Barrick has paid $200 mill for projects with no resource - just potential in the jungle... like Kainantu.
CTO Price at posting:
17.5¢ Sentiment: LT Buy Disclosure: Held
