African Barrick Gold Share Discussion Threads

[jungmana] 21/7/2013 12:36

UC You are wrong there. ABG does not have the highest in the sector.Tell me which peers have you compared it with?

[undervalued companies] 21/7/2013 12:11

Well I guess this is what PIs said through the last 12 months don't catch a falling knife until it's bottomed it's not.

Abg has the highest costs in the sector normal is $700 to $800 before adding all in costs.

I await next week results.

[jungmana] 21/7/2013 12:01

Imo ABG is a buy at this price. the all in cost is about $1100(cash cost of $893 from q1 results) and cash in hand of about £260m.
as gold rebounds above $1300, ABG share price will move up and I believe the company will be ok in the medium term as long as gold stays above $1200.

[riskybiznizz] 21/7/2013 10:27

Be VERY quick. Battered share price expected to rebound hard throughout next week...

19 July 2013
FRONTIER MINING LTD
("Frontier" or "the Company")
Publication of Expert Independent Report
Frontier Mining (AIM:FML), the AIM listed exploration, development and production company focused on Kazakhstan, announces the publication of an Independent Expert Report, by Wardell Armstrong International, entitled "Review and Preliminary Valuation of Baitimir Project Located within the Naimanjal License Territory NE Kazakhstan, dated 16 July 2013."
Wardell Armstrong International (WAI) is an independent engineering and environmental Consultancy, which has provided the mineral industry with specialised geological, mining, and processing expertise since 1987. WAI was commissioned by Frontier to prepare a scoping report to include a preliminary financial evaluation, based on data provided by Frontier up to 25 December 2012, of the Baitimir project. The project is located within the Naimanjal license, and is comprised of the Baitimir, Yubileiny and Beschoku copper deposits.
This report documents the geological block preliminary modelling and mineral resource as at October 2012, and is a non JORC (2004) compliant desktop report.
The results of the financial modelling show that, when applying various discount rates between 8% and 20% the model produces Post Tax Net Present Values of US$17 million and US$67 million respectively based on income from the recovery of copper, silver, gold, magnetite and molybdenum. The internal rate of return (IRR) for the Baitemir and Beschoku projects are approximately 40% with a payback period outlined in the report of 2.73 years. Wardell Armstrong estimates that the cash operating costs over the life of mine are approximately US$10.01 per ton of oxide ore processed and US$19.79 per ton of sulphide ore.
DCF Model Results (Before Funding and Debt Service):
NPV@ Discount Rate
8%
USD$m
67
NPV(Base Case) @ Discount Rate
10%
USD$m
53
NPV @ Discount Rate
15%
USD$m
30
NPV@ Discount Rate
20%
USD$m
17
IRR
%
40%
The review and preliminary valuation support Frontier Mining's view that Baitimir is an attractive project with robust economics. Frontier will keep all options open as to the optimal development strategy for the Baitimir whether that be from its own resources, through joint venture or through the sale of the project to a third party.
A full copy of the report can be found on Frontier's website: www.frontiermining.com
Frontier Mining Ltd
Yerlan Minavar
[phone]
Libertas Capital (NOMAD)
Sandy Jamieson
[phone]
RFC Ambrian (Broker)
John Harrison
Richard Morrison
[phone]
Walbrook PR
Walbrook IR
Lianne Cawthorne (Media Enquiries)
Paul Cornelius (Investor Enquiries)
[phone]

[kooba] 21/7/2013 10:00

pog = price of goldThey have already closed some higher cost operations from 04/13" During the quarter we ceased mining operations at Tulawaka and are working with the Government to finalise the closure plans.""Cash costs2 of US$931 per ounce sold, with cash costs excluding Tulawaka of US$893 per ounce sold"The $893 figure is only up 3% on a like for like basis from same period previous year...hardly out of control and very much in line with industry cost inflation I would have thought ?Dyor

[smurfy2001] 21/7/2013 09:29

Vicious Gold Rally Coming

[undervalued companies] 21/7/2013 09:13

Kooba until we see the RNS next week nobody know what the cash costs are but last time was aiming around $950 cost adding the normal all in that's $1,150 to $1,250 fox d capital thinks it's $1,400 all in so $900 I assume cost is wrong. The cash pile reducing all the time that was Dec 2012 through uncovered dividends and break even.

Abg has well known supply issues which need diesel back up rather than power from the grid adding to cost.

Instead of pig ponging around I am happy to wait for RNS costs my belief if you pushed me based on history are not good.

[smurfy2001] 21/7/2013 09:06

What's the pog?

[kooba] 21/7/2013 09:02

Only got involved recently at 96p if you care to believe or look back ...i Have traded around that position...but haven't been "spouting" much longer than you!..the cash cost of continuing operations are already historically sub $900 and they have already identified cost savings in a number of areas with the interim review update so if they can cut some operational costs and capex going forward until or if there is a recovery in the pog and with a $400m cash pile I believe the company is in a better position than many gold miners to ride this shake out.I still believe that gold has already bottomed...my view may be wrong but am entitled to an opinion...But the price of gold to companies such as ABG with high operational gearing to the underlying price does have an enormous impact on the investment fundamentals...perhaps you want to check the correlation between ABG the sector and thepog?

[undervalued companies] 21/7/2013 07:39

Kooba I have not been on here longer enough to know whether you were spouting this or not when abg was £4 it's not just about the gold price. Technicals point to $900.

Miners can still go down if the gold price goes up IF the certain companies either have high debt or high inflation costs.

Abg has high inflation costs one of the worst in the sector hence the share price or they would be on par with randgold.

The key question we need to know next week is will they cut to $750 say $1050 all in.

I would also note fox d capital says abg break-even is $1400 at present however not sure how they made this calculation.

[kooba] 20/7/2013 18:40

Jim Rogers is bullish on gold as he is very pessimistic on the feds actions but thinks it might have one final puke before recovering...he has not sold any gold recently and is adding to his position so his call to below $ 1000 is hardly conviction ...his reading is psychological rather than fundamental...I think we have already seen the capitulation move in western markets the reason it has not fallen further is that bric economies particularly china have been happily absorbing the slack and this has acted as a shock absorber and the lows are already in imho.The physical delivery position of gold is what should be focused on...paper gold which is 100 times bigger than physical gold is what dragged this market down but if the Chinese and Russians demand delivery there could be a crunch.dyor.No recommendations on shares

[undervalued companies] 20/7/2013 16:10

Kooba I am negative now on gold at this present time that does not mean I am negative in the future.

Smurfy I cannot recommend any as of now but Kirkland lake is a safe country and going to cut costs some like biggie ones like randgold it really is too early IMO.

Abg could be IF it cut costs let's see next week

I am in jim Roger camp.

[smurfy2001] 20/7/2013 13:59

What gold stocks would you chaps recommend?

Not interested in AIM stocks.

[kooba] 20/7/2013 13:40

I rather think the pog and the technical factors in that market at the moment are relative to the price of ABG...The specifics of their own cost and production profile are also of specific importance..which will become clearer shortly.But the underlying price of the commodity they produce does have some bearing!Your negative on gold... I'm positive on gold....suppose that's what makes a market!!

[undervalued companies] 20/7/2013 12:43

They are not gold bugs you should see though how the short ETF gold has increased.

We can all put articles for gold up and I can put far more giving technical reasons why gold going to fall plus fundermental reasons but what's the point a good google can show both sides.

The main issue is abg costs and how the reviews has or not cut them.

[kooba] 20/7/2013 10:47

Re no gold bug has sold yet ...check out the US ETF numbers...capitulation by the retail is evident....however retail always get their timing wrong as they dump gold after the correction to buy equities that are pumped up beyond any fundamental value..it's what they do!Gold solid performance over the past two weeks also comes despite continued selling of gold-back exchange traded funds.This week gold ETF holdings fell more than 3 tonnes to 1,979 tonnes, the lowest since May 2010 according to Bloomberg data.The outflows equate to more than $60 billion wiped off the value of the world's more than 140 gold-backed ETFs.Gold bullion holdings hit a record 2,632 tonnes or 93 million ounces in December 2012.

[kooba] 20/7/2013 10:39

Where's all the gold gone?!http://www.zerohedge.com/news/2013-07-19/jpm-eligible-gold-plummets-66-one-day-total-gold-fresh-all-time-low

[undervalued companies] 20/7/2013 07:25

Frankly it's a complicated bottom no gold bug sold yet.

I cannot see with the gold miners write down season upon us how most gold stocks are going to outperform ?

But at least keeping figures crossed for abg next week look out for costs numbers

[kooba] 20/7/2013 05:57

Friday feeding frenzy for gold stocksThe gold price continued to build on recent gains making an assault on the crucial $1,300 level late on Friday, sending investors scurrying for gold mining stocks.Bullion bulls are still nursing a 23% decline in the price of gold this year, but with the largest producers of the yellow metals showing declines of more than double that, many punters believe the bottom may now have been reached.http://www.mining.com/friday-feeding-frenzy-for-gold-stocks-48590/

[smurfy2001] 19/7/2013 12:20

If there's a rise in interest though gold will go down further?

[kooba] 19/7/2013 10:43

For those of a more bullish disposition on gold such as myself I think we are close to a major reversal as the printing presses keep rolling and the bric economies contract...leaving these geared gold mining plays attractive..we do have to see what the strategic review has to say shortly to see just what this management who have previously disappointed thinks they can achieve.But not as worried on physical gold as others..interesting read on theaque nature of gold markets...you do think at some point where there is over 100 times more"paper" gold than actual physical there could be an almighty squeeze on delivery..we shall see!http://www.zerohedge.com/news/2013-07-18/eric-sprott-asks-do-western-central-banks-have-any-gold-left

[undervalued companies] 19/7/2013 09:03

I would also put a health warning on spread bet and Zak Mir if you took there advice you would be now down by 99.5% at best on this one.

[undervalued companies] 19/7/2013 08:58

Well sorry guys in jim rogers camp on gold price. Going into the months of sept and oct thinking golds going up will be disappointed.

Let's look at abg fundermentally it's all about the cost price if they can get this down to $700 - $800 on review then great if it's $950 Ish we are in big trouble.

Remember always add $200 ontop of cost price for an all in value.

[smurfy2001] 18/7/2013 22:44

I'm tempted to start buying in advance of Diwali.

Demand for gold will increase in advance....