I believe it’s worth comparing VEC with one of its closet peers, I believe West African Resources (WAF) they are currently sitting at a MC of 207mill. WAF is approximately 6 months ahead of Vector in regard to DFS, they traded as high as 47.5 cents, approximately 400mill MC at beginning of 2018. This really illustrates the potential Vector can have moving forward. Once our DFS is completed, more will able to be compared. This comparison report is only aimed at unveiling Vectors true potential.
Vector has a much higher grade and almost 1/3 larger resource. Vector’s higher-grade Gold reserve converts to a more efficient and productive plant once in operation.
W- Total resource: Probable Mineral Reserve 39Mt at 1.8g/t for 2.35Moz, potential to be upgraded.
V- Total resource: has a JORC (2012) Mineral Resource Estimate of 15.0Mt @ 6.6g/t Au for 3.2Moz of contained gold. Massive potential to be upgraded with Kibali next door.
Both V and W both plan to go open pit and underground.
W- Fully permitted, environmental approvals and mining permit updated.
V- Fully permitted, environmental approvals and mining permit for underground operations.
Both boards are well equipped to take these projects to production.
Capital structure and SOI.
W- A$36million cash on hand (no debt funding yet, but expect $185mill CAPEX to be debt funded)
V- A$77.6million (US$55 mill) cash on hand (debt funded) but with enough cash to progress project to decision to mine. with 70% of equipment on site, valued at US$70mill so a further 30% required say A$27.83mill (US$21 mill) required for 100% of equipment, Id say Vector has a better cash advantage.
to think Vector only had to come up with US$55mill with a project which has had US720mill spent on it, in regards to drilling, mining camp etc. Who is better positioned? I believe Vector.
SOI
W- 690mill shares
V- 1.8 Billion shares
W- Low pre-production CAPEX of US$185mill
V- with 70% of equipment on site, so CAPEX IMO will be kept low.
In regard to mine development-
W- Yet to be constructed
V- Has 70% of equipment on site, full operational mining camp, roads, water, electricity etc
Plan to be in production
W- Q3 2020
V- TBA but believe Vector can potentially be in production in the first few quarters in 2020 if not before.
This a back of the envelope comparison, IMO I believe West Africa to have similar if not more sovereign risk attached. WAF is dual listed on the TSX, I believe Vector would have similar plans. Here’s to hoping anyhow.
I believe Vector in comparison should be valued much higher then this peer. Based on resource and grades alone, the DFS will paint a much better picture, but I believe Vector is well positioned to take the market by storm.
200 mill MC with Formosa escrowed 330mill shares dilution values Vector at around 12 cents.
Vector has a total of 9 leases in which all have potential to be money makers moving forward.
AIMO DYOR
VEC Price at posting:
2.0¢ Sentiment: Buy Disclosure: Held
