perseus starting to fly, page-9

The NPV of the two combined projects pre dilution: $2.62 per share. If you want to use NPV with extra dilution it would move down to ~$2 (Ayanfuri $432m/280m shares + Tengrela $134m/280m shares).

When assessing the value of a mining company pre construction phase it is highly common to use the NPV as a yard stick. The sp will move away from the NPV and towards the eanings/pe fundamental model as the probability of mining the resource increases towards 100% - each hurdle: BFS, Finance, Capital purchases, mill construction, and eventually first pour will see a tick for the company and a subsequent positive move for the sp (all things being equal).

PRU over the coming year will be moving away from the NPV model, for me this is the most exciting phase and the one with most upside. We will see many analyst and brokers recommend PRU as an emerging mid tier gold producer and it will gain wide recognition like CNT.

I’ve already done some back end numbers for PRU producing from two mines in 2011, I used $950US, $0.80AU and a PE of 10.

Very happy to lock-in my money until 2011 and see full value (assuming that everything goes to plan).

…and who knows where gold will be then? I may drastically be short changing the upside!?!