Ashanti: Year end reserves were again calculated based on inflated 300 POG. The good news for gold bulls is that ASL has already sold forward 3,782,000 oz. so we are unlikely to have to endure much spot market selling. Annual production is a tad below 1.6 million. They've written calls on 4,344,000 more oz. out a decade at prices ranging between 320-366. Those calls might be a nice "delta hedge" fireworks display if this market ever took off.
The Good: ASL has three solid properties.
Obuasi (Ghana) produces 528K @ c.c of 192. With 11 million oz reserves, it could be around for a couple decades. Almost all is underground however, which is problematic for companies (like ASL) in weak financial condition.
Geita is a great property. 240K to ASL's account @ c.c of 141, 30 year life.
Tanzania has more exploration potential (see Tan Range: TNX), but some question as to how involved ASL is there.
Siguiri: 280K, c.c: 181, end of decade
So (1050K) of ASL is solid, long life.
The Bad and the Ugly:
Iduapriem is depleted, but ASL is bringing in fairly expensive (c.c-225) "make work" ore from Teberebie. Production is 185K, but there is a 9 year life.
Ayanfuri is depleted.
Bibiani: 232K, c.c 156 will be depleted in 2004. Little luck with exploration there.
Freda-Rebecca (Zimb.): 100K @ 229 c.c will likely be depleted in 2004.
Conclusion: ASL is still a basketcase. Might be a good project for a strong company (know of any?) who could monetize the absurd hedge book and focus on Geita and the challenge of Obuasi. Might want to buy Birim while they're at it. At minimum, 332K is gone by mid-decade.
More to come. |
