Some nice drill results put out by the company. We need to know...

Some nice drill results put out by the company.

We need to know what the new feasibility study has to say about IRR, capex, AISC, payback period etc to determine if WAF is a buy/hold or sell. The feasibility study will have to do much better than the previous one given the 700m shares/options on issue and the very limited post tax returns previously estimated.

No doubt a mine will be built there at some point in time. The question is who will own the gold deposit, and what will be the returns of current shareholders.

In the absence of the feasibility study I would risk a smallish punt on WAF now if the share price dropped to 25 cents - but that probably will not happen. I do not need to take on extra risk by owning WAF at higher prices since I already own a heap of goldies.

I am not confident that the USD gold price will hold up in the short term. Indian demand is a bit off (but Turkey and China are still buying at a good level. Gold needs a catalyst to spark a run, however this is the slow season for Indian buying - I am waiting for their annual festivities to commence and start a bit of a rally in the second half of 2018. Higher Fed funds rate and USD are not helping, I suppose. It is possible that the gold price will break to the downside and head to USD1240-1250, and if that does not hold then prepare for USD1200 which I think would attract a lot of buying from India and result in at least a medium term level of support. If the US/global inflation story gets going then our overseas based goldies will do well, but the Oz-based ones may do even better.

At present its very hard to believe that the USD POG will head over 1400 this year.

GLA.

loki (I last held WAF shares in 2012 for a small profitable trade.)