Excellent news that the gold recovery from Youanmi is likely to be higher than in the Scoping and Pre-Feasibility Studies.‘Mr Metallurgy’ is well on the way to delivering an excellent processing solution.
But yesterday’s jump in the RXL share price was mostly because of the soaring price of gold and its positive outlook.
A one per cent increase in the recovery adds to the free cash flow by AU$ 45 an ounce on an assumed gold price of AU$ 4,500.
On the 100 koz PA as planned, that’s a handy AU$ 4.5m additional cash flow PA or AU$ 9m for 2%.
However, the price of gold has recently jumped by over AU$ $160/oz (currently AU$ 5,180/ oz).
100koz with an assumed price of AU$ 4,500, is an additional $15m PA.
At a gold price of AU4,500 oz with an AISC at an expected AU$ 1,800 oz Youanmi will have a free cash flow of AU$ 270m PA.
Further increases in the price of gold are expected.
Note that the gold price is up by 40% in the past 12 months, but only recently have equities started to run. There is plenty of room to go much higher.
April was the strongest month to date for Chinese EFT investment.
The Chinese are banking on gold bullion for the long haul and the decline of the USD as the world’s trade currency is now underway.
Predictions for the future price of gold are stunning.
The LOM of the Youanmi Gold project is certain to increase, providing fully franked dividends for more than 10 years..
The DFS is focused on the high-grade UG ore, so will have an LOM shorter than 10 years.
But in time, Rox will extend the life of the project by processing the shallow ore.
Currently, there is around 400 koz that will add several more years to the LOM.
Of course, Rox will keep exploring along the Shear Zone for the next Penny Gold (RMS).
Have a look at the non-marketable (for retail) parcels of shares being traded.
Instos are keeping the share price low while accumulating.
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