Ann: Major strike and depth extensions to Eagle and Diucon, page-36

from Today's $tockhead interesting!?!

• All the, very unserious, news and muses from the sidelines of Australia’s biggest mining forum
• Gold Fields fields (our) questions on De Grey’s Hemi mine

Everybody Loves De Grey-mond

Our favourite game at Diggers and Dealers is asking every gold miner and explorer when they are buying De Grey Mining (ASXEG) and its Hemi gold mine.
The 9.5Moz gold deposit, part of the 11.6Moz Mallina gold project near Port Hedland, is the largest in the development pipeline this century in Australia. A DFS is due this quarter, but the numbers on the previous PFS are already something else — 540,000ozpa for a decade spitting out around $4.2 billion of free cash after the taxman has his take.
We’ve asked a few penny stocks with little more than some dusty gold nuggets to their name, whose board of directors may or may not include people no longer alive, about their bid plans, just to see who we can make squirm.
There are a handful of more serious propositions floating around Kalgoorlie ahead of DEG boss Glenn Jardine’s presentation tomorrow.
Gold Road (ASX:GOR) managing director Duncan Gibbs, whose company currently holds a strategic stake of almost 20% of the more than $2 billion explorer, escaped without a serious grilling.
But there are feelings bigger dogs could be in the yard. Newmont is acquiring Newcrest (ASX:NCM), signalling a pivot back to Australia for the world’s biggest gold miner. Agnico Eagle and Barrick have also been kicking around WA.
Then there’s Gold Fields, the South African giant which missed out on big fish Canadian target Yamana Gold last year to Agnico and Pan American Silver and is keen to bolster its Australian portfolio, which currently includes the St Ives, Granny Smith, Agnew and half of the Gruyere gold mine.
Its last M & A move was a decision to take a 50% stake in Osisko Mining’s Windfall mine in Canada.
“It’s expensive at the moment, I think it’s expensive to do a deal. But for the right asset a deal is worth doing no matter what the price,” Gold Fields’ Australian boss Stuart Mathews said.
“We would still consider M & A in Australia. Absolutely. We wouldn’t like to stop.”
What about a cheeky question on Hemi itself?
“Well the thing is it’s got a long way to go … they’re still looking at where’s the reserves and look it’s a great project … looks like they’re looking for a deal but I don’t know.”
We’ll file that under the no comment category.
Where Gold Fields is keen to grow is through exploration — it’s spending around $80m a year in WA — and through boosting the renewable capacity at its mines, while its Granny Smith project near Laverton remains under-fed, its mill is operating around 20 days a month.
“We managed to get a commitment from executive and the board to spend $100 million for five years on our four mines. We have made massive discoveries out of that,” Mathews said.
“So in that time, we have discovered something like around six or seven million ounces. At around $80 per ounce discovery, to buy those sorts of reserves, I would have to pay $500, $600, maybe $700 (an ounce).”