Nothing but good news here, factually based on assayed drill results to industry and TSE standards, and conservatively presented.
Looks like NAP with a grade of 1.82 oz/t pgms could produce 273,100 oz pgms annually over an 11 year life at the existing open pit minesite. The LdI geological resource is increased to over 5.0 million oz of palladium. Presumably the 1999 removals of waste rock lead to the lower strip ratio of 2.26:1. All of this is just the expansion of the existing open pit mine and its palladium deposit, mainly the Roby Zone, which is still open down dip at depth, and apparently also to the southeast.
Therefore better grades, larger geological resource, reduced strip ratio, and open exploration targets in the palladium deposit. NAP begins drilling this month to assess these additional expansion targets, and begins construction in March on infrastructure and pit expansion.
In addition, there is the new Measured and Indicated Resource of 23.5 m tons at 1.64 g/t pgms outside the proposed pit expansion (presumably also LdI deposit, exclusive of the pending Tib Lake and Buck Lake property explorations).
All of this would seem to identify North American Palladium as a premier low grade pgm producer with one of the largest pgm deposits in the world. Financing with debt avoids share dilution, and it appears that NAP can 'select' the lead bank of their choice.
With the current economies of scale kicking in to their operation, the blue sky potential of their local and regional properties, the scarcity of palladium reflected in its continuing long term price appreciation, and the country risk associated with the largest producers in Russia and South Africa, let's hope they continue to avoid hedging their production and leave their share price exposed to spot palladium.
Ptask |
