Easy now, don't put a hard edge on what I am saying. I know the people in GUY quite well enough. They build eight mines in Canada since 1967. North American Palladium was one of them. As a matter of fact I worked for them briefly in the eighties. Bear this in mind. They will NOT sell the deposit to a major. A few majors have looked at it. They have never, or practically never, (Whitestar Copper is a partial exception) sold even an interest in a deposit to a major in 38 years, so they are probably not going to start now.
What I am saying is that they are not drilling to attract Barrick or Dome mines. They do not need to. I doubt that with their stock price a deal with Dome would interest them. They can afford to turn them down. As well, with the amount of drilling, notwithstanding the last year's wide, generous grade intersections, they could not possibly have drilled off more than ~one million~ ounces total in the past two years. A five million ounce deposit has to be huge. About 146 holes huge, with all of them hitting. Probably in gold that would mean 250 holes drilled. Do they have one third that number of huge holes? Not quite yet. So 5 million ounces would not be the target. (As an example, Kinross, out of Falco, drilled 1500 holes to define the Kinross 1060 in Timmins. That took them one year+ with ten drills. That is a mine drilling program. No fooling around.)
How else do we know that they are not headed there or have a decent chance of getting there? (5 mega oz's) It would be known and the market would price them at around 8 bucks. That is how we know.
Their track record, market depending, is to drive a stock from the almost mid singles to the 20's or better, raise development money on their own, and go ahead with it. They are not that big on gold, as Lyndex attests. I expect them to get the stock to about 6 dollars (If that can be done) and announce a production decision.
With one million oz's in the bag, they can afford to spend 20 to 50 million to develop. (they don't need that much to get going, really) That is a figure they can scare up given a favourable development scenario.
EC<:-} |
