Is this the Cheapest Gold Stock in the World

Is thisthe most undervalued gold stock in the world?

Based onwhat has been announced PGI has a 49% share in a gold deposit which already has55,000m of qualitydrilling done by the Canadians. Although PGI cannot say how much is there until they have a JORC you can safely say there is enough gold there at sufficient grades to make the project economically viable. As announcement 7 August says “The PFS will review technical and commercial aspects of MLV’s development concept of mining 800,000tpa of ore from an open pit mine for 6 years, to produce in the order of 55,000tpa of concentrate with a target grade of 47g/t Au and 380g/t Ag (as determined by the past metallurgical test work of SGS Lakefield at their laboratory in Toronto)” PGI are also talking about a 16yr mine life if they go underground. So if you read the announcement carefully I think you can make certain assumptions, one being grade as above and 2 the gold is there when you are talking 16years.

Question then is what are ounces in the ground worth. In current environment, whether you agree or not, the market is sayings they are worth a lot. There are many tables comparing ounces in the ground and market cap. They range from AUD25 to De Greys AUD466. I am intentionally trying to keep this simple by not comparing measured/indicated/inferred.

As per previous I post I expect the project has at the very least 1.5m onuces in the ground otherwise why would you do it? Again trying to keep it simple, if you take PGI stake in the JV the value of there 49% at $AUD50 (definitely at the very low end of valuations out there) then PGI share of “value” is AUD36.8m. I know there is money to be spent but just trying to compare listed.

So why the hell is PGI trading at a market cap that is cashin bank of $8m??? It has to worth at least double it’s current market cap……. andSP it is current going down!

NB: I have intentionally kept this simplistic but when you are talking about mutiples of market cap upside I can be out on assumptions and still able to show how cheap PGI is. I have discussed my view on Cuba, having done business there myself, in previous post.