If I assume the Mako deal goes ahead as described and Aurum in it's current form comes up with a 500,000oz resource (I.e. 500K plus the 800 K) at a market cap of 2.5% of resource value in the ground, I get a 67c valuation. If that number is 750K then the value grows to 85c. I know others expect the number to be North of 750oz, which may well be, but I want to be conservative early. Obviously, the gold price is a major factor in determining the resource envelope and pit shells and it's currently pretty favourable.
I've used the 2.5% for the resource value as it's what I see as reasonable for that stage of the game for a goldie in Cote D 'Ivore with Caigen and the team managing it (track record of delivery).
The resource-to-reserve conversion may be lower but the valuation of reserves will be much higher when it happens.
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