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They've already said a large % of drilling has gone towards shifting inferred to indicated (rather than increasing ounces). Just looking very roughly in FY22: They increased the resource by ~ 0.55 moz to 4.2 moz from an exploration spend of ~$24 million. They've spent about ~$28 million in this current half year - so divide those out and I get about 0.65 moz they might be able to add to the current resource as a complete guess (haven't looked closely at the drill results and made an intelligent guess on the increase in ounces). Round up to 5 moz total on the next update and I get a EV/OZ value of around $65 ~ Which is probably actually fairly valued in my book considering they have not even done a scoping study. We haven't really seen much M&A activity in Africa lately and I suspect the bigger fish in the market are happily sitting back sipping on lattes waiting for these exploration jrs. to keep burning cash to upgrade resources - essentially calling their bluff (a lot of these juniors are desperate to get bought out and not move into production). Let's say PDI can spend another $50 million this year on drilling and get to 6 moz, maybe 7moz - who is out there that can afford to buy them out and then go spend a half billion on the capex? I just have this feeling that there are getting to be a lot of decently large looking deposits but not enough people willing to fund them into production. Sprott...What isn't a buy with them?[ATTACH=full]152395[/ATTACH]
They've already said a large % of drilling has gone towards shifting inferred to indicated (rather than increasing ounces). Just looking very roughly in FY22: They increased the resource by ~ 0.55 moz to 4.2 moz from an exploration spend of ~$24 million. They've spent about ~$28 million in this current half year - so divide those out and I get about 0.65 moz they might be able to add to the current resource as a complete guess (haven't looked closely at the drill results and made an intelligent guess on the increase in ounces). Round up to 5 moz total on the next update and I get a EV/OZ value of around $65 ~ Which is probably actually fairly valued in my book considering they have not even done a scoping study.
We haven't really seen much M&A activity in Africa lately and I suspect the bigger fish in the market are happily sitting back sipping on lattes waiting for these exploration jrs. to keep burning cash to upgrade resources - essentially calling their bluff (a lot of these juniors are desperate to get bought out and not move into production). Let's say PDI can spend another $50 million this year on drilling and get to 6 moz, maybe 7moz - who is out there that can afford to buy them out and then go spend a half billion on the capex?
I just have this feeling that there are getting to be a lot of decently large looking deposits but not enough people willing to fund them into production.
Sprott...What isn't a buy with them?
[ATTACH=full]152395[/ATTACH]
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