Where To Look As Peak Gold Approaches

FN Media Group Presents Oilprice.com Market Commentary


London – November 25, 2019 – It’s finally happening: peak gold. The big gold companies can’t grow any bigger, and the biggest ones are losing steam. Today, the real golden opportunities are in the small miners. And there’s one little company in West Africa that appears ready to break out.  Mentioned in today’s commentary includes:  Eldorado Gold Corp. (NYSE:EGO), Yamana Gold (NYSE:AUY), Agnico Eagle Mines (NYSE:AEM), Kinross Gold Corporation (NYSE:KGC), Wheaton Precious Metals (NYSE:WPM).


With a new CEO and a near-term target of 50,000 ounces of gold per year, African Gold Group (AGG; AGGFF)  should be popping up on your radar. And it’s just getting started: the company is shooting for 100,000 ounces per year, from a mine that already has an estimated 2.2 million ounces of gold in the ground. AGG has locked in the Kobada Mine, astride Mail’s prolific Birmian Greenstone belt and industry titan Stan Bharti has just joined as CEO.


The timing couldn’t be better: Gold is building. Major miners are looking for fresh acquisitions. Banks are hoarding gold and talk of the gold standard has spiked. All of this means the world’s most precious metal is set for a major rebound.


Here are 5 reasons to take watch AGG (AGG; AGGFF)


#1 From Big to Small


Major gold miners can’t hack it right now. Bloated from over-investment in declining assets, even high gold prices can’t save the big firms from losing value.


In fact, Goldcorp Inc. Chairman Ian Tefler has said we’ve reached “peak gold,” with years of growth finally stalling for the big miners. So to balance out, they’re looking to snap up smaller firms. This means there could be big gains coming from little firms like AGG (AGG; AGGFF)  with fresh assets just waiting for new capital.  So it’s the start of a new round of mergers for the big companies, as they snap up whatever assets they can find.


Barrick Gold took over Randgold in 2018 for $18.3 billion. Newmont Mining took on Goldcorp, just after Tefler’s “peak gold” comments, laying down $10 billion.


President Trump is talking openly about returning the US to the gold standard: a fantastical idea, to be sure, but one that is sure to boost gold prices in the near term. Attaching the US dollar to gold would require massive gold purchases by the US Treasury—another factor leading to higher prices.


Gold assets are being snapped up in equity markets around the world  in preparation for a possible economic downturn in 2020. If you’re worried, buy gold—that’s been the mantra for decades. And no one knows this better than AGG CEO Stan Bharti, whose been immersed in gold throughout his career.  He’s identified AGG as the newest low-priced gold asset. And there are few compelling reasons why.


#2 Location, Location, Location


AGG (AGG; AGGFF) is sitting on a literal gold mine: the Kobada mine, lying on top of Mali’s prolific Birmian Greenstone Belt. It’s a colossal formation running across 350,000 sq. km of first-class gold deposits in Burkina Faso, Ghana, Guinea, Mali, Niger, Senegal, and Côte d’Ivoire.


The Kobada Mine sits in the middle of this formation, with a total estimated resource already of more than 2.2 million ounces.


The property is 25 km long and 15 km wide covering an area of more than 200 square kilometres, with AGG owning the whole license. It’s already proven the 2.2-million-ounce haul, with the bulk near the surface—the deepest AGG has dug thus far is 300 meters.


A 2016 feasibility study supported Kobada’s worth. It’s an open-pit operation, using gravity separators and leach, a low-cost operation in an area with a high proven return rate. AGG estimates average LOM at $557/Oz Au, exclusive of royalties, with LOM sustaining cash operating costs of $788/Oz Au. That’s against a current price of $1500/Oz. The company’s on a fast track, working through the rainy season, with a new hole drilled every 3 days.


#3 By the Numbers


The 2016 feasibility numbers at Kobada are exactly what investors should be looking for:  flows from starter pits and a post-tax IRR of 43%, based on $1200 gold, or 55% based on $1400 gold…with an even higher figure on $1500 gold. The AGG feasibility study highlighted a $45.4 million pre-production capital cost, and it is currently spending about $180k per week on drilling, at $70k per hole.


African Gold Group (AGG; AGGFF) is targeting a 1.5-year payback from the start of commercial production, and full payback in only 2.5 years: modest, attainable goals that it should reach no problem, considering the high potential of the Kobada mine.


The 2016 feasibility study shows that AGG can produce 50,000 ounces of gold a year with the potential to build that to 100,000 ounces a year. All for a steal, at only $50 million.


There are a lot of good gold projects out there, but few see the light of day. That’s not the case with Kobada.  The mine is on track for a new feasibility study in April. Extensive exploration and metallurgical tests have proven the mine’s potential. And that’s thanks to AGG’s secret weapon.


#4 The Gold Standard of Leadership


There’s a new man at the helm of AGG: legendary gold exec Stan Bharti. He took over AGG on August 7, when he was appointed chairman of the board, President and CEO. An engineer, international financier, seasoned entrepreneur who brought in $3 billion in investment for past companies, Bharti’s got a long history with Mali, the site of the Kobada mine.


His firm Forbes & Manhattan, based in Toronto, is a leading firm specialized in distressed assets. For gold, that means a good management team with lots of gold in the ground and a need for lots of capital.


Kobada represents the newest opportunity, for a few reasons:


  • A solid feasibility study with a resource of 2 million ounces close to the surface.
  • A good location in a prolific African gold belt.
  • Old management that just wasn’t cutting it.


F&M took it over and brought on a new board, including Stan Bharti as Chairman, President & CEO.  With new management in position, it’s time to get to the gold. Bharti’s track record on turnarounds is self-evident, but there are other AGG board members and managers to take note of:


Sir Sam Jonah is the former CEO of Anglo Gold Ashanti, one of the two major gold companies operating in Africa in the 1990s, and one of the most highly respected African gold veterans around.


There’s also Bruce Humphrey, former COO of giant Goldcorp, the 2nd-largest gold company in the world. John Begeman, the CEO of Avion—the Mali-based gold company that he and Bharti grew from $20 million to $500 million. And now, AGG can boast another big name: Daniel Callow, a 12-year veteran for trading/mining giant Glencore’s African copper operations, the new AGG COO.


#5 The Next Gold Rush Is About To Begin


While junior miners have the most exciting upside potential, investors would be smart to keep an eye on some of the industry’s growing stars. Eldorado Gold Corp. (NYSE:EGO) is a fine example.


Eldorado has already produced 276,376 ounces of gold in the first three quarters of this year, and after the company confirmed its hefty end-of-year projections, it serves to reason that the company will be mining even more gold in the last final stretch of the year. Year-to-date, Eldorado has seen an impressive 133% surge in its share price, and it’s not likely to slow down now.


Yamana Gold (NYSE:AUY), much like Eldorado, is currently hard at work to ramp up its own gold production.  Zacks Investment Research has called Yamana “a great momentum stock,” saying that all the numbers for the company are right, promising long-term growth. While Yamana’s growth hasn’t been quite as impressive as Eldorado’s, it has still seen a healthy 34 percent rise in its share price since the beginning of the year.


Yamana also signed a deal with Glencore and Goldcorp to initiate a brand-new project, also in Argentina. Yamana is also a 50 percent owner of Canada’s largest gold mine, the Canadian Malartic. And who owns the other half of the largest gold mine in Canada? That would be another Canadian gold producer, Agnico Eagle Mines (NYSE:AEM).


Agnico is the fourth largest gold mining stock on major U.S. exchanges according to the Motley Fool. Like its peers, it has also posted brag-worthy returns this year, seeing its share price grow by an impressive 45 percent.


Agnico Eagle has a lot going for it.  As the Motley Fool writes, “much of Agnico Eagle’s popularity among investors comes from its near-term potential for rising production.”


Additionally, Agnico Eagle shareholders have benefited from one of the longest streaks of dividend payouts in the industry. Not only has Agnico Eagle managed to pay out a dividend for a whopping 36 years, their CEO Sean Boyd has long said it is a company priority to increase the payout.


Like Agnico Eagle Mines, Kinross Gold Corporation (NYSE:KGC) has also secured a position in the Motley Fool’s list of the 10 biggest gold mining stocks on major U.S. exchanges, coming in at lucky number seven. Kinross has a much more global view than many of its compatriot companies.


Though Kinross has only posted a 28 percent gain on the year, it is a safe bet for investors, with its established position in the industry and impressive portfolio.


For people looking for something a bit different, Wheaton Precious Metals (NYSE:WPM) offers a unique take on the mining market. Massive and well-established, Wheaton has a hand in operations around the globe and a secure position as one of the largest ‘streaming’ companies on the planet.


Wheaton has earned an impressive 33 percent gain in its stock price this year thanks to the renewed interest in gold and its strategic positioning in the market.


The real story, however, is in small-caps like African Gold Group (AGG; AGGFF). It is sitting on 2.2 million ounces of mineral resources in Mali. That means that a small-cap company with a market cap of only $30 million is sitting on gold reserves potentially worth billions. Shares are under 30 cents right now, while gold prices are at $1500. That is the cheapest way to get in on 2 million ounces of gold—ever.


By. Joao Piexe



PAID ADVERTISEMENT. This communication is a paid advertisement. Oilprice.com, Advanced Media Solutions Ltd, and their owners, managers, employees, and assigns (collectively “the Publisher”) is often paid by one or more of the profiled companies or a third party to disseminate these types of communications. In this case, the Publisher has been compensated by 2227929 Ontario Inc. to conduct investor awareness advertising and marketing concerning African Gold Group. Inc.2227929 Ontario Inc. paid the Publisher fifty thousand US dollars to produce and disseminate this and other similar articles and certain banner ads. This compensation should be viewed as a major conflict with our ability to be unbiased.


Readers should beware that third parties, profiled companies, and/or their affiliates may liquidate shares of the profiled companies at any time, including at or near the time you receive this communication, which has the potential to hurt share prices. Frequently companies profiled in our articles experience a large increase in volume and share price during the course of investor awareness marketing, which often ends as soon as the investor awareness marketing ceases. The investor awareness marketing may be as brief as one day, after which a large decrease in volume and share price may likely occur.


This communication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security. Neither this communication nor the Publisher purport to provide a complete analysis of any company or its financial position. The Publisher is not, and does not purport to be, a broker-dealer or registered investment adviser. This communication is not, and should not be construed to be, personalized investment advice directed to or appropriate for any particular investor. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Further, readers are advised to read and carefully consider the Risk Factors identified and discussed in the advertised company’s SEC, SEDAR and/or other government filings. Investing in securities, particularly microcap securities, is speculative and carries a high degree of risk. Past performance does not guarantee future results. This communication is based on information generally available to the public, and does not contain any material, non-public information. The information on which it is based is believed to be reliable. Nevertheless, the Publisher cannot guarantee the accuracy or completeness of the information.


SHARE OWNERSHIP. The owner of Oilprice.com owns shares and/or stock options of the featured companies and therefore has an additional incentive to see the featured companies’ stock perform well. The owner of Oilprice.com has no present intention to sell any of the issuer’s securities in the near future but does not undertake any obligation to notify the market when it decides to buy or sell shares of the issuer in the market. The owner of Oilprice.com will be buying and selling shares of the featured company for its own profit. This is why we stress that you conduct extensive due diligence as well as seek the advice of your financial advisor or a registered broker-dealer before investing in any securities.


FORWARD LOOKING STATEMENTS. This publication contains forward-looking statements, including statements regarding expected continual growth of the featured companies and/or industry. The Publisher notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the companies’ actual results of operations. Factors that could cause actual results to differ include, but are not limited to, changing governmental laws and policies, the success of the company’s gold exploration and extraction activities, the size and growth of the market for the companies’ products and services, the companies’ ability to fund its capital requirements in the near term and long term, pricing pressures, etc.


INDEMNIFICATION/RELEASE OF LIABILITY. By reading this communication, you acknowledge that you have read and understand this disclaimer, and further that to the greatest extent permitted under law, you release the Publisher, its affiliates, assigns and successors from any and all liability, damages, and injury from this communication. You further warrant that you are solely responsible for any financial outcome that may come from your investment decisions.


TERMS OF USE. By reading this communication you agree that you have reviewed and fully agree to the Terms of Use found here http://oilprice.com/terms-and-conditionsIf you do not agree to the Terms of Use http://oilprice.com/terms-and-conditions, please contact Oilprice.com to discontinue receiving future communications.


INTELLECTUAL PROPERTY. Oilprice.com is the Publisher’s trademark. All other trademarks used in this communication are the property of their respective trademark holders.  The Publisher is not affiliated, connected, or associated with, and is not sponsored, approved, or originated by, the trademark holders unless otherwise stated. No claim is made by the Publisher to any rights in any third-party trademarks.


DISCLAIMER:  OilPrice.com is Source of all content listed above.  FN Media Group, LLC (FNM), is a third party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated in any manner with OilPrice.com or any company mentioned herein.  The commentary, views and opinions expressed in this release by OilPrice.com are solely those of OilPrice.com and are not shared by and do not reflect in any manner the views or opinions of FNM.  FNM is not liable for any investment decisions by its readers or subscribers.  FNM and its affiliated companies are a news dissemination and financial marketing solutions provider and are NOT a registered broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security.  FNM was not compensated by any public company mentioned herein to disseminate this press release.




This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and FNM undertakes no obligation to update such statements.

Contact Information:

Media Contact e-mail:  editor@financialnewsmedia.com  U.S. Phone: +1(954)345-0611


SOURCE: Oilprice.com