gold - silver - zinc
Near term producer & explorer - Abitibi, Quebec
AGORACOM NEWS FLASH
Dear Agoracom Family,
I want to thank all of you for your patience with us over the past 48 hours and apologize for what was admittedly a botched launch of our new site.
As you can see, we have reverted back to the previous version of the site while we address multiple forum functionality flaws that inexplicably made their way into the launch.
To this end:
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Message: Analyst Research Report on Abcourt Mines from March 30, 2011
The full analyst report link is contained in the article.
Ahlan
Analyst Research Report on Abcourt Mines Inc. with Upside Valuation Investment Opinion
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On Wednesday March 30, 2011, 2:16 am EDT
Abcourt Mines Inc. (TSXV:ABI.V) (Other OTC:ABMBF.PK) is identified in newly issued analysts report by Howlett Research with justification of upside market valuation. The analyst has initiated coverage with significant upside re-rating based on repositioning of assets with emphasis on production potential.
The full Analyst report may be found at http://www.sectornewswire.com/HowlettResearchABImarch28-2011.pdf online.
The qualified analyst has identified Abcourt Mines Inc as significantly undervalued with several base metal properties and a gold property (all 100% owned) in Quebec's prolific Abitibi Greenstone Belt heavily discounted at current share price valuation of under CDN$0.25:
1. Elder Gold Property; A joint venture spent $23 million in the 1980s to put this 100,000 – 200,000 oz. property into production, but the plan vaporized when Noranda decided to process material from its own Silidor Mine and additional capital could not be raised for a mill. Internal updates to the (non 43-101 compliant) feasibility study call for very modest capx and $550 - $600 cash costs/oz. The argument for attracting a financial / jv partner and moving forward to develop a mine is very compelling.
Speculative Potential at Elder Au Property: Assuming 135,000 oz Au (current M&I @ higher 0.15 opt Au cutoff), capx of $20 million, cash costs of $600 / oz and Au price of $1400, this project would generate a net pretax value of $88 million, along with a 1 year payback @ 25,000 oz / yr.
2. Abcourt-Barvue Silver-Zinc Property; The property unifies two past producers with significant exploration / development work. It has been the subject of a 2007 optimized feasibility study for a 500 million lb. Zn, 13+ million ounce Ag orebody over a 10 year minelife. New simulations incorporating known (incl. some non 43-101) resources, increasing the mining rate, and increasing Ag recovery show robust economics (~25+ after tax IRR, ~$60 million NPV(8%), ZnEq $0.50/lb cash op. costs @ $0.90 Zn, $25 Ag). Note – the “simulation” is not an updated feasibility study and should be considered speculative.
Speculative Potential at Abcourt-Barvue Zn-Ag Property: At $1.00 Zn and $25 Ag, Ag contributes over 40% of NSR value and in today's environment, this should be considered a two product property. According to our calculations, any reasonable pricing scenario with either Zn or Ag holding up shows very good results. The long term outlook for Zn is excellent post-2012 as significant historic producers begin to go out or production. Low zinc and (necessary) new projects appear inconsistent.
3. Vendome-Barvallee Zn-Cu-Ag-Au Property; A satellite property to the Abcourt Barvue property, with a 900,000 ton historic (non-43-101) resource. Ownership has recently been rationalized, with Xstrata selling the JV claims to Abcourt. There is potential to include some of these resources into the Abcourt-Barvue production schedule.
4. The Aldermac Zinc-Copper Property; The property has known resources at the previous mine and undeveloped high grade discovery in 1987 / 88. Based on historic reports (Wright Engineers, prior to 43-101 standards) the in situ value of the 1987/88 discovery is $200+ million. There is considerable valuable underground development. Drilling since acquisition in 2007 has been very positive in confirming resources and outlining new potential.
Investment Considerations:
"It seems abundantly clear to us that the market perceives Abcourt as a company with some insitu resources but focused on exploration and resource development. These resources have been given a typical low value per lb (or oz as the case may be). The fact is that Abcourt has two advanced properties with considerable development. Today's commodity prices may well make these projects viable. As prices firm up, financing / JV possibilities for these projects may open up. With a market cap of under Cdn $25 million, there is a wide value gap that we believe can be narrowed should Abcourt reposition its assets and link programs more directly with potential to monetize properties as producers."
The full Analyst report may be found at http://www.sectornewswire.com/HowlettResearchABImarch28-2011.pdf online.
This release may contain forward-looking statements regarding future events that involve risk and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual events or results. Articles, excerpts, commentary and reviews herein are not advice, are for information purposes only and are not solicitations to buy or sell any of the securities mentioned. Readers are referred to the terms of use, disclaimer and disclosure located at the above referenced URLs.
Contact Information:
Fredrick William BA Ec., Managing Director
Market Equities Research Group
[email protected]
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