Is Lake Carey MAT's Paulsens?

The more I look at, the more this Lake Carey deal reminds me of the Paulsens acquisition by Northern Star (NST) back in 2010.
Here are some similarities and differences:

• Paulsens came with a high grade resource of 129K oz. Lake Carey has a lower grade 385K oz.
• Paulsens came with its own plant. MAT will have Lake Carey ore toll treated.
• Paulsens had an established mine plan of 51K oz, generating $44m of free cash. MAT is anticipating producing 40K oz with free cash of $10m (my conservative estimate, not the company’s).
• Paulsens came with enormous exploration upside, so too does Lake Carey, with today’s drilling results illustrating this and opening the door to potential high grade mineralisation.
• Paulsens used partial debt finance for the acquisition. MAT will use all equity.
• Lake Carey was acquired for $4.54/oz in the ground. A comparison with Paulsens is not really relevant given the different stages of the projects.

The fact is that I see no reason that with a current gold price of AUD1,587 that MAT shouldn’t be making closer to AUD400/oz in profit. Using a toll treatment cost of $35/t and a grade of 1.9g/t, toll treatment for per ounce equates to AUD573/oz. If we double this to include trucking etc. we arrive at let’s say AUD1,150/oz all in.
Of course this is all back of the envelope stuff, however at AUD400/oz profit and 40K oz p.a. production, this leaves AUD16 million p.a. in profit, or 11c EPS.
Once MAT releases further information – and it does seem that they are moving a million miles an hour to bring Lake Carey into production; MAT will receive a massive rerating, just as NST did.
I repeat, I believe the Lake Carey acquisition was a master stroke by PP and will be seen in the not too distant future as the deal that finally made MAT.
I also believe MAT is a VERY low risk buy at current levels with the technicals supporting a substantially higher share price.  I will post more about the technical later.