Cluff Gold Share Discussion Threads

[pennylane2] 15/8/2012 07:53

Continuity of cash generation from all assets in the coming years is the biggest plus point.£1+ share price towards end of year is easily achievable.

[pineapple1] 15/8/2012 07:15

Good set of numbers from CLF if not awe inspiring.

Costs stable (poster who,s avatar escapes me said costs should be ok was correct and moi was humbly wrong) which is good news and confirmation again that long term finance for Baomahun is not going to be done thru equity.Lets hope this takes some of the pressure off the share price ....imho

[jdk14] 14/8/2012 14:24

The FD has already said that the numbers will be decent - not stellar.

[pennylane2] 14/8/2012 14:09

Interim result may lift up the share price further,hoping for better numbers.

[jdk14] 14/8/2012 13:24

..of course they may flog it to focus on SL!

[fitton] 14/8/2012 13:22

Yaoure update seems to be as expected,not setting the world on fire with grades but looks like a very solid resource base.Hopefully there should be a good million oz's or more of reserves.10 year mine life.

[wallywoo] 13/8/2012 11:01

Amargoza, thanks for that, role on Wednesday!

[amargosa] 13/8/2012 10:36

I know the price of everything and the value of nothing.

[pennylane2] 13/8/2012 10:35

Excellent post Amargoza..You know so much about this company. ;-)

[amargosa] 13/8/2012 10:26

August 06, 2012
Cluff Gold Will Shortly Reveal How It Plans To Fund Development At The Multimillion Ounce Baomahun Gold Project In Sierra Leone

By Alastair Ford

How are things shaping up at Cluff Gold amidst the current market turmoil? Life's not easy, says finance director Pete Gardner, but it could be a whole lot worse.


Location of Baomahun

For a start, the company's Kalsaka gold mine in Burkina Faso should generate between US$50 million and US$60 million in cash flow this year.



The latest operational numbers are due out on 15th August, and they show that if not exactly soaring away, the company is at least on track.



"Q2 was alright", says Pete. "I wouldn't say it was a stellar performance, but we generated cash. It was a decent quarter and we should have a decent story coming out of it."



That's no bad thing in a market where new capital is scarce and share prices are plummeting, and it has a special resonance since investors had been, until very recently, fretting about Kalsaka's short mine life and dwindling reserves.



However, that issue was addressed shortly before Cluff's founder and chairman Algy Cluff left for entrepreneurial pastures new earlier this year. Back in February Algy brokered a deal with Orezone Gold Corporation to acquire the nearby Sega deposit, and thereby extend the mine life beyond 2013.



The distance between Sega and the Kalsaka plant will involved some additional trucking costs, says Pete. But he adds that the ore at Sega is higher grade and will ultimately pay for the trucking.



So Kalsaka survives and the cashflow remains. But that's only half the story as far as Cluff is concerned. The company also has two other major projects on the go, the former producer at Yaoure in Cote D'Ivoire, and the multimillion ounce development project at Baomahun in Sierra Leone.



"The big story", says Pete, "is Baomahun." The preliminary economic assessment that the company put out towards the end of 2010 shows why. Using a US$1,100 gold price and on the basis of a 1.4 million ounce resournce, a range of consultants including SRK, AMEC and SGS concluded that Baomahun could support a 157,000 ounce per year operation over an eight year life, mining at a cost of US$500 per ounce. And there's little doubt that Baomahun could get even bigger. The resource is undoubtedly there, but so too is pressure from the Sierra Leone government to get on with mining.



But either way, it was on the strength of the potential at Baomahun that Algy Cluff was always able to tap American investors for huge sums of money. And it was that same potential that tempted new chairman John McGloin away from a plumb job as head of mining at the London office of Canaccord, newly merged with Collins Stewart.



John's a geologist with plenty of experience of operating and consulting in Africa, and adding his insights to those of company chief executive Peter Spivey has been hugely beneficial, says Pete. Hence there's been more drilling at Baomahun recently, ahead of a resource update that's now due in October. "And when we get that resource we'll give guidance on the feasibility study", says Pete.



The market's been waiting a long time for the Baomahun feasibility study, though, which may be one reason why the company's shares have drifted, in spite of the robust production and cash flow, from highs earlier in the year of over 100p to the current 49.5p.



But it's a tough market all round, and the companies that are really getting punished are those with perceived financing risk. Cluff's got Kalsaka to fall back on, but as far as growth is concerned it needs US$200 million or more to get Baomahun off the ground, and it'll take more than Kalsaka production to get there.



"Ultimately", says Pete, "people are very aware of financing risk. But we are not too far away from the point where we will demonstrate how we will finance Baomahun." Something will be announced, he promises, before the Denver Gold Show, which gets underway on September 9th.



That announcement could trigger a re-rating for two separate, but related reasons. First, the very existence of a financing plan will go a long way towards assuaging doubts about Cluff's ability to grow in the current adverse economic climate. And second, it will show that the new chairman is just as adept as the old when it comes to bringing big money to the table for development.

[wallywoo] 13/8/2012 10:23

amargosa - why do you think the interims are 15/8. I can find no information that is the case. They were in September last year

[amargosa] 11/8/2012 09:32

Zero chance. However, there could be the Sega study, resource update from Baomahun, and/or drilling results from any of the 4 sites. Interims on 15 Aug.



So, Randgold is looking to buy some smaller gold mining companies.

[ppidkw] 10/8/2012 19:41

What chance of a DFS on Monday?

[the troll] 10/8/2012 17:50

cash = c 36% of current market-cap.

[amargosa] 10/8/2012 14:49

Bit more of this and the algorithms will start to notice.

[the troll] 10/8/2012 14:22

cash was $53.4m @ 31.3.2012 ( see RNS of 7.6.2012 );
since they're, effectively, offering shares priced in March's placing at 38% discount ( 57p now vs 92p then ) I'm happily taking advantage thanks ( NAI ).

[fitton] 10/8/2012 13:26

Seems a fairly liquid market at the moment the market makers are quite happy taking stock.

[fitton] 10/8/2012 13:13

Reversal of the recent downward trend.Very likely to be some news on the way.Less likely to be buying just because it looks very good value.

[fitton] 10/8/2012 13:10

It was recently disclosed to be about $28m

[tatser] 10/8/2012 12:59

what's the current cash position of the company?

[ukgeorge] 09/8/2012 17:42

should atleast bounce up to mid 50's imo, but really still needs to break that downtrend

[amargosa] 08/8/2012 22:40

More sector consolidation:



They (Endeavour MC) don't appear phased by Mali or BF.

[amargosa] 07/8/2012 15:13

The company must be currently very vulnerable to a predator, at least until a finance deal for Baomahun is actually signed off (Q4?) - with hacked-off shareholders, finance for Baomahun not yet sorted and DFS delayed. Not the outcome I would have hoped for or expected. Lets see what they have to say on 15 Aug; there is normally a live Q&A. Will they survive intact as an independent company by YE I wonder.