Owning one of the biggest virgin gold discoveries in the last 15 years in Western Australia does not necessarily deliver a premium market rating. Not immediately anyway.
Just ask Breaker Resources (ASX: BRB). It has the lowest market value per oz of gold resource in-the-ground amongst its peer group.
Yet its Bombora discovery at its Lake Roe project, 100km east of Kalgoorlie, comfortably sits amongst the biggest virgin gold discoveries of the last 15 years.
Still, there is no getting away from the fact that Bombora is shaping up as a multi-million oz resource that will be developed initially as an open-cut, and later as an underground operation.
Importantly, executive chairman Tom “Colonel’’ Sanders owns 12% of the stock and he makes no apologies for having delayed resource upgrades.
The Colonel is a seasoned geologist with more than 35 years’ experience, much of it in WA’s goldfields and nickel operations.
He insists that Bombora is advanced on a strong technical base, not to an agenda driven by market demands for sugar hits.
So if it is going to take a little longer to come up with a new resource estimate because there is a mass of drilling data to crunch, so be it. And it has to be said that there are plenty of examples of others rushing out resource estimates that have not stood the test of time.
Announcing the delay in the latest resource estimate, the Colonel said it was due to the scale of the deposit, and the volume of data to be crunched.
The PFS is expected to be released two to three months after the July resource update. Both are likely to be re-rating events for the stock in their own right.
The PFS in particular is eagerly awaited, not just by investors but by any one of the existing gold producers that have been following Bombora since its discovery as a possible acquisition target, remembering it is a relatively rare find in the past 15 years.
BRB Price at posting:
32.0¢ Sentiment: Hold Disclosure: Held
