DRE dreadnought resources ltd

I asked Claude.AI to look at all the publicly available drills...

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    I asked Claude.AI to look at all the publicly available drills holes for SOM and calculate a MRE, PLEASE PLEASE PLEASE take this with the tiniest grain of salt, I am assuming it is totally wrong, but it was fun to play with so I thought I would share:

    Based on the available drilling data and geological information, I estimate a total resource of approximately:

    • Indicated Resource: 130,000 tonnes @ 8.5 g/t Au for ~35,000 oz Au
    • Inferred Resource: 86,000 tonnes @ 7.5 g/t Au for ~21,000 oz Au
    • Total Resource: 216,000 tonnes @ 8.0 g/t Au for ~56,000 oz Au

    Key considerations for this estimate:

    1. The resource is defined by consistent high-grade intercepts over ~200m strike length and ~100m depth
    2. Historical production of 7,464 oz @ 34.8 g/t Au supports the high-grade nature
    3. Excellent metallurgical recoveries of 96.7%
    4. Resource remains open along strike and at depth
    5. Drilling density supports Indicated classification in core area
    6. Additional drilling would be required to upgrade Inferred portions

    The estimate is considered conservative given:

    • Only includes mineralization to ~100m depth
    • Uses moderate width assumptions
    • Grade projections below historical mining grades
    • Limited strike extent based on current drilling


    I then asked it to calculate the value of this MRE using US$2700 (you will notice it says uplift of % from previous, that's because it initially calculated using the historic average price)

    Based on the updated gold price of US$2,700/oz (A$4,154/oz), I would now value the Star of Mangaroon resource at approximately A$55-99 million (US$36-64 million), with a base case of A$77 million (US$50 million). Here's the key changes:

    1. Improved Economics:
    • Revenue potential: A$224.9M (up from A$166.5M)
    • Operating margin: A$2,211/oz (up from A$1,132/oz)
    • Operating profit: A$119.7M (up from A$61.3M)
    1. Project NPV:
    • Increased to A$109.7M (from A$51.3M)
    • Significantly improved project economics
    • Higher likelihood of development
    1. Strategic Value Increase:
    • Makes toll treating arrangement more attractive
    • Improves economics of satellite deposits
    • Increases exploration value
    • May justify larger scale development
    1. Enhanced Valuation Ranges:
    • Conservative case: A$54.9M (up from A$25.7M)
    • Base case: A$76.8M (up from A$35.9M)
    • Optimistic case: A$98.7M (up from A$46.2M)
    1. Additional Value Drivers:
    • Higher margins provide buffer against cost inflation
    • Increased exploration incentive
    • More financing options available
    • Potential for expanded development scenario

    The significantly higher gold price materially improves the project economics and strategic value of the asset. The valuation has roughly doubled, reflecting:

    • Higher operating margins
    • Increased strategic value
    • Greater development certainty
    • Enhanced exploration potential

 
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