Hey folks,
Thought to share some of my research of PSL which I've quietly been doing over last few months. Admittedly I haven't been a poster on here often, but occasionally observing the discussion. I'm unable to post the link here, but suggest searching for and listening to the interview on * with Peter Strachan and MD Brian Thomas.
"Rock Yarns: The highest leverage play in Australia's hottest mining district" from 19th June.
I know a few long term holders were burnt by the previous HDY management which I never like to see but it happens unfortunately. For disclosure, I was not a holder during the HDY era, but my assessment of the newly recapitalized PSL with an entirely new management team has significant upside in the medium & long term and is probably one of maybe 5 -10 ASX micro cap Gold plays which have not yet moved during this current bull market. I actually think this one has been flying under the radar probably due to association with previous management team. I also think PSL is at a significant advantage to other explorers who "might or might not" find gold in the ground, as given previous drilling has already identified good Gold grades at shallow depths. They "will" find the gold. The other massive advantage is the proximity to Newcrest / Tefler mine!In my opinion I reckon valuation for PSL will change quite swiftly once IP surveys are completed in 2 weeks. Noting they have just completed a well supported and oversubscribed SPP for $3.55 mill, so well cashed up for initial phase of exploration across multiple projects.
Anyhow, I'll share a few notes I took from the interview but encourage you to have a listen for yourselves.
My headline takeaway is that if drilling at Grace is successful there is a very good chance Newcrest will be involved in either a JV (or takeover) as it's proximity makes it economically viable to feed into the Telfer plant, which will need new sources from 2023. PSL has had initial talks with Newcrest according to Brian.
Key observations from interview
Grace Gold Project - Paterson Province WA
- Only 500m of drilling done on 1.4 km of tenement by Newmont
- Already has proven 69,000 Oz of inferred resource, potential much bigger
- There is a significant rock outcrop at Grace, compared to Telfer
- Historical IP (Induced Polarization survey to test chargeability of the orebody) was done in the late 80’s and 90’s, old technology. Modern IPs will look into the orebody much deeper.
- Brian believes Copper is also present but was not included in prospectus
- Very excited about a “Large magnetic target” in south eastern part of tenement (nicknamed as “the whale”). Re-modelled by Geos who have said it’s a lot deeper and all drill holes done by Newcrest “fell short”.
- The deeper orebodies compare to other nearby tenements are very big (e.g. Haverion, Calibre, Antipa)
- Grace is shallow and benefited by outcrop
Burraga Project (Lachlan Ford Belt) - NSW
- Lucky Draw – old deposit with very good grades + Hackney’s creek looks like a very shallow resource (lower grade). Total 134,000oz inferred Au
- Lloyds 1.68Mt Copper @ 0.9%
General observations
- Currently extremely busy in the WA region (e.g. Newcrest, IGO, MetalsX etc)
- Discussions had with Newcrest, once re-listed and PSL market is valued at the right price will reconvene discussions with them for a potential JV.
- Want to maximise value for long suffering shareholders from previous management (HDY)
- Telfer Processing plant 25km away (extremely close + potential for processing).
I've also done a bit of research on the new management team, which I might share in a future post if this one is of use.
Suffice to say, I'm quite bullish on PSL re-rating shortly and have quietly been quietly accumulating over recent months. That wall at 0.004 and 0.005 might look daunting at present, but I'm not worried at all. I saw this exact same thing happen with some other Gold plays in ADV (0.05 to 4.4c), SBR (0.3 to 2c) to name a couple, when the action started from basically the same position as PSL is in now, those walls were smashed down and both ran .
That's it from me, GLTAH.
p.s. Buddy @mollaj you've been a bit of a good luck charm so the fact you're here is a positive.
