G’day holders, I bought today after reading the announcement and have been doing some VERY rough calculations on possible near term SP predictions.
-
firstly, I am not a miner, geologist, engineer or expert at calculating Net Present Value. I have made a few very rough assumptions to enable some planning, this isnt investment advice.
-
Assumptions
Inferred value of Au/t in ground -$30AUD/Oz
Measured and indicated -$45
Proven and probable -$20
initial inferred resource may be up to 50% greater in overall size
Mineral density for inferred deposit can be recalculated with the 13m intersect density of 14.62 g/t
-
So, the Munda Gold project preliminary inferred resource was 3.77 Mt@ 1.43g/t = 173,000 Oz gold. Using an inferred value of $30 p/t, in the ground its worth approx. $5.3mil AUD.
-
Based upon the recent assays indicating 13m @ 14.62g/t, it may be a fair assumption that the actual deposit may be anywhere from 10-20 times greater mineral density per tonne than anticipated. (pending remaining assays) however if the deposit turns out to be 3.77 Mt @ 14.62g/t = 1,768,000Oz Gold. as announced(this does not include the extreme density 1m intersect) it is worth approx. $53Mil AUD as an inferred resource. However the Munda RC drilling project underway is assessing “conceptual targets together with infill and extensions”, meaning the deposit could have a greater size and mineral density than originally planned.. So, lets say based on the initial inferred deposit being calculated on at 3.77Mt the retreivable resource could be up anywhere from 4.5-7 Mt. so, if we consider a possible 50% increase in salvageable resource, an adjusted inferreddeposit of 2,652,000 Oz, Worth approx. $79.5Mil.
Once the company is able to further assess and calculate the resource, so that the resource is “measured and indicated” the deposit could be assumed to be worth Approx $45/Oz in the ground, so we’re looking at $106Mil.
Heres where the big jump comes into it, there is a vast difference in bankable value of a Measured and indicated, versus Proven and Probable, which could be valued at anywhere from $150-$250/Oz.
So once the deposit can be Confirmed P&P, were talking about a in ground value of approx. $530Mil AUD For the Munda Gold Project alone. Divide that by SOI (I will say current SOI +25% to allow cap raising/Consultancy and JORC upgrading etc) you could estimate a SP of $500mil/50mil SOI = $10.00 per share.
-
CAVEAT:
This would be a drawn out process to achieve P&P resource status. And i have made A Lot of assumptions; but just running some numbers to highlight the possibilities when looking at long term SP.
I am keen to here your thoughts and opinions , and for any feedback on my scrappy work!
GLTAH
(20min delay)