(Kitco News) – Newcore Gold jumped 75% this month after releasing an updated preliminary economic assessment.
On Tuesday President and CEO Luke Alexander spoke to Kitco Mining.
The mining sector has been enjoying good tailwinds: copper has run up 20%, and gold has hit several all-time highs this year. Still financings remain moderate, according to Oreninc. Selective companies are being financed. Alexander hopes the market doesn’t run away.
“I actually hope it remains a selective financing market,” said Alexander. “It’s really just the quality projects that get financed, the ones that stand out from the hundreds. [It] is a cyclical business. As the market heats up and as people get more exuberant, the PowerPoint presentations get dusted off and every project out there gets financed.
“Inevitably…projects that don’t have quality assets, that don’t have quality teams, that aren’t at a stage that they should end up getting financed. The stock prices lag or collapse, and shareholders end up suffering. It then becomes more challenging for the sector to perform overall.”
Newcore Gold (TSX-V: NCAU) is advancing its Enchi gold project in Ghana. In April the company released an updated preliminary economic assessment. At a gold price of $1,850 ounce the company showed a $586 million pre-tax net present value discounted at 5%, and a 77% pre-tax internal rate of return rate. The average annual gold production was estimated at 120,000 ounces. The company was up 75% this month.
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