I've been looking around for an undervalued near-gold producer and CAS fits the bill with an excellent portfolio of advanced projects and a low market cap of only 33 Million dollars at 11 cents.
All the attention is on the high-grade Juarena project but I think the real jewel is Borborema.
Borborema is already at bank feasability study stage and has 1.6 Million ounces JORC which provides an excellent way to leverage a rising gold price IMO. The climate in the Borborema part of Brazil is good all year round (no wet and dry season) and the orebody is tabular with good geometry. Initial metallurgy is also good with 96% gold recoverable.
Juarena grades at 14.7 g/t for 206K ounces and these high grades are the reason why it has the spotlight. The recent hiring of a lead mining engineer and the purchasing of a crushing plant shows their intention to accelerate towards mining.
The Posse Iron Ore project is profitable. This successful operation should not be underestimated as it demonstrates that CAS can successfully commission a mine and work effectively with their in-country mining vendors. This is important as another Brazilian gold prospect that I was watching (OGX) totally stuffed up their initial plant commissioning causing mayhem to their investors. But CAS has demonstrated that they are competent and experienced with plant commissioning in Brazil.
Some of the long-term holders may be sceptical with the progress as it seems to have taken its time. But remember that we have been in a long gold bear market until recently and that's when things tend to slow down and share prices fall. However, we are now at the early stages of a gold bull market IMO and I like the way that CAS has recently made good progress on their quality gold projects at an increasing pace. CAS looks ripe for a rerate this year IMO. A successful Juarena plant commissioning and a rising gold price will be key.
It's all about timing. I think CAS is in the sweet spot right now. I've loaded up.
CAS Price at posting:
11.5¢ Sentiment: Buy Disclosure: Held
