Norseman Gold

In light of Tulla's JV partner PNR raising capital (announced today) this is a review/analysis of the potential for that $10mil 'reserve milestone' payment being made in the future.

• Milestone payment terms

So PNR have to pay Tulla $10mil when Norseman reaches a reserve of 1.8mil (this is a very substantial reserve figure by the way! The kind that any of the top tier miners aussie miners take notice of)

• Current Reserve

Norseman's current reserve (as at 27/9/21) was 713k (so it's already very impressive!) which was an 18% increase from the previous reserve.

• Current Resource

Norseman still had 2.1m ounces of decent 'resource' (measured and indicated) that has potential to be converted into 'reserves' (requires more drilling to convert).

• Analysis

Since the last Reserve statement (27/9/21) the Norseman JV has released 3 more sets of drill results. (I'm not detailing them all here, but basically so far whenever they drill at Norseman they hit multiple quality intersections of gold).
They still need to find/convert another ~1.1m ounces of gold (1.8mil minus the existing 710k) into reserve to unlock that $10mil payment and based on the last reserve update bringing an 18% increase even with the 3 sets of great drill results in the past 6 months I still can't see them hitting that milestone this year (on basis of releasing the updated Norseman reserve statement in Sep 2022).... eg; even a 50% increase (which is huge and unlikely in my view) of 350k ounces would leave them ~800k ounces short of triggering the payment.
But their drill form at Norseman to date suggests to me it's only a matter of time until the 1.8mil target is hit. - with more rigs onsite it might be hit in 2023.

Bottom line - Norseman has a very substantial amount of gold to be mined. I feel the current plant design under plays the value of Norseman a bit (eg; it could be bigger)..... and I'd be surprised if the current larger aussie miners (eg; NCM, NST, EVN, SLR, RMS etc.) let the current Norseman JV keep all that gold to themselves.