re: Ann: Wagtail Continues to Deliver Outstan...
Kimberley gold story has familiar tone
Michael Quinn, 30 May 2012
THOUGH the company may not possess the most immediately startling gold development project on the resource sector horizon, Bulletin Resources managing director Martin Phillips maintains the proposed Lamboo operation in the Kimberley region of Western Australia has potential analogies with some big market stories of recent times.
Phillips cited Medusa, Ramelius and Silver Lake as examples of companies with high-grade, profitable operations that he believes Bulletin can potentially, in time, imitate.
Lamboo is pegged to start life in 2013 as a 30,000 ounce per annum, five year operation mining open pits transitioning into underground operations. Cash costs will total about $A1000/oz, while capex (up until positive cashflow is achieved) is put at $A25 million.
Phillips told HighGrade Bulletin’s sought after debt-to-equity mix was likely to be in the order of 60:40, and that financiers were expressing interest in backing the project.
He anticipates that interest to firm in the next couple of months once current infill drilling confirms reserves at the project. Lamboo’s NPV and IRR will also be revealed at that time.
Phillips believes that in time the opportunity is for a 50,000ozpa operation, with the goldfield having plenty of untapped exploration potential after being forgotten and ignored on account of the focus given the Eastern Goldfields of WA – despite the yellow metal first being mined in the Kimberley. He also noted the prospectivity for the likes of base metals and rare earths, though gold is the company’s focus.
Bulletin was capitalised this week at an extremely unchallenging $A6.5 million, especially given cash at the start of the current quarter of $A2.9 million.
While Phillips believingly contends Lamboo technical risks are low, convincing investors of Bulletin’s merits has evidently thus far at least proved more difficult.
Moving towards and into production should assist the process no end.
source: highgrade.net
BNR Price at posting:
7.1¢ Sentiment: Buy Disclosure: Held
