Citi's bearish gold sector report out today is Bullish for Pershing Gold. Think about it. Yes, projects with all-in costs of $1,100 + per ounce are doomed unless gold prices rebound to $1,600 or more. If that happens, all juniors will go up a lot and everyone will be happy.
However, if gold prices are stuck between $1,100 and $1,400 per ounce for an extended period, then Pershing's low-cost, low-risk, project and blue sky exploration potential for additional low-cost, low-risk projects should be increasingly valuable. Not to mention the 100% owned, built and paid for processing facilities.
Mid-tier, and eventually larger gold companies, need to replace the substantial amount of current and planned production that's out of the money......
These companies can start staking ground in Nevada to replace production in 10 years, or acquire companies like Pershing Gold with first production next year. Instead of waiting for CDE to acquire Pershing, why not consider all three, CDE, Pershing and Rye Patch being acquired by a Major retrenching from Africa? |
