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Related Quotes
Laurie Curtis, Clarus Securities Inc. (01/27/11)
| "Colossus controls one of the highest-grade precious metal deposits in Latin America. By JVing the flagship COOMIGASP project, Colossus has created a working model for community Cooperation, which bodes well for the equitable development of the project. The company has embarked on an aggressive but staged underground pre-development of the orebody, completion of which is anticipated by Q212. This underground development will provide mine access, geotechnical data and also facilitate underground drill stations for grade control drilling and delineation of the orebody. This program will derisk perceived issues with ground control and close-spaced drilling will provide the necessary confidence to complete mine planning. The 25,000m underground drilling program to be carried out Q311 at a high density (15m–20m sections) will provide the necessary level of confidence for the deposit grade, which together with throughput and recovery will drive the mine model. Other than potential geotechnical challenges with the carbonaceous host to the ore deposit, we believe the Serra Pelada project will provide a high rate of return; the upside being improved recoveries, likely additional discovery of zones of bonanza grades and the potential for additional discoveries within the landholdings. We initiate coverage with a SPECULATIVE BUY rating and a $10.50 target price. Our target price is derived from a discounted cash flow valuation for the Serra Pelada project based on our calculation of an Au Eq. mineable ounce profile of 3.6 Moz. (2.7 Moz. attributable)." |
| "Another company on our list is Colossus Minerals, which is now at the resource delineation stage with a gold-platinum-palladium project in Serra Pelada in Brazil. It is advancing towards production. They have had a great run with high grades." View Entire Article: Marshall Auerback: Fiscal Policy Setting Stage for a New Bubble |
| "It is clear that as the story at Serra Pelada unfolds, exploration will deliver some surprises. . .Our assessment is that Colossus have the bit between their teeth and are currently on time and on budget with sufficient funds to develop the $100MM build up. The ramp up to production as presently forecast will see commissioning in H2/2012. . .Bulk sampling and grade control drilling will diminish risk [on this project], but based on new holes such as SPD-072 (which returned a characteristic high-grade interval of 25m grading 30.2 g/t gold, 3.53 g/t Pt and 4.25 g/t Pd) it appears that further sub-parallel structures with high grades will be encountered during development and underground drilling. While we cannot speculate as to total number of ounces contained at Serra Pelada, this site visit confirmed that the CMZ is not a one-off and that Colossus is truly developing what will be one of the world's highest grade precious metal mines. The influence of bonanza intervals with grade-thickness composites in the thousands, while rare, appear to be a characteristic of the ore body. Historical reconciliations of the highest grade hole drilled by Vale (and well preserved in the Colossus core storage area) relative to the ounces returned by the artisanal miners lends support to the thesis that these intervals will be the driver for superior returns and future value at Serra Pelada. Faced with the unusual challenge of quantifying how rich portions of the CMZ will be is a nice problem to have. Ultimately, the question to be answered at the end of the current development at Serra Pelada is how colossal can it get?" |
| "We have just returned from a visit to CSI's 75%-owned Serra Pelada development in Para State, Brazil. . .development is progressing well, with the road header (continuous miner) now actively advancing the decline and civil works for the processing plant and tailings facility moving along. The pace of progress is consistent with Colossus' intent to have initial production by mid-2012 (probably commencing April/May) with the Phase 1 (gravity-only) plant. CMZ represents solid potential: On the exploration front, we believe that the central mineralized zone (CMZ), which was extended along strike by 50m in the drill holes released on October 21, remains wide open to the southwest. The West and GT zones (which lie slightly to the northwest and appear to be parallel to the CMZ) are also open and likely will merge (holes testing this theory are currently in progress). Most importantly, the company has recognized several areas that have comparable geologic setting to, and with geophysical and geochemical signatures similar to, the known deposit. Success in drilling these areas could have a profound effect on CSI's valuation." |
| "The Serra Pelada project is a uniquely high-grade gold/PGM project that is on track to begin production in 2012, with recent exploration demonstrating the upside potential of the land package. We view CSI as a likely takeover target. We maintain our SPECULATIVE BUY recommendation on the shares of CSI with a target price of CAD$12 per share. CSI has completed 83m of development of the 3,500m underground decline at Serra Pelada. Earthworks has begun on the future plant site, camp site, maintenance facilities and offices. The company has begun negotiations to secure electrical power to the site. The camp site and engineering of the tailings impoundment are expected to be completed in Q111; phase 1 dewatering to a depth of 150m is expected to be completed by Q311; and the phase 1 tailings dam is scheduled for completion in Q411 with phase 2 dewatering to 320m by Q212." |
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