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The following is automatically syndicated from Grandich's blog. You can view the original post here. Stay up to date on his model portfolio!
April 26, 2011 05:22 AM
Donner Earns In, 19 months to Production and Cash Flow
The news out today for Donner Metals reports that they have completed their earn-in on the Matagami zinc-copper project in Québec. This milestone has been in sight for a while, but it is important to note the accomplishment. It is well-deserved, and quite frankly impressive that in the relatively short 5-year period they have made an award-winning new discovery, are in the process of developing a mine, and are now sitting at a mere 19 months from first production.
The large volume and sideways trading we saw was IMHO putting a cap on the stock, in large part due to legacy warrants from the financings done to keep the company going after the global financial shocks in 2008. Donner’s Chairman David Patterson is a long-time friend with a well-deserved reputation for being able to raise capital in both bull and bear markets. Donner is working towards the financing necessary for the project which pays Xstrata back for what they’ve already spent on Donner’s behalf for the new mine.
The new mine went into construction in July 2010 months ahead of Donner receiving the positive feasibility study because Xstrata has their own timeline of events and are sticking to that. Xstrata has their own mine currently in production in the camp, and it should be completely mined out by late 2012; in order to eliminate lag time and prevent their onsite mill from shutting down, it’s believed Xstrata accelerated the development of the new Donner-Xstrata mine to come into full production by January 2013.
Today’s news shows that development is well on the way to meeting that target, with the ramp construction already down 900 metres of the necessary 2.3 kilometres, (about 1.43 miles).
In the past I’ve offered Donner up as a possible takeover candidate for Xstrata, but with this earn-in and announcements of $4 million/year anticipated for exploration moving forward in 2011, it really shows that a junior can go into production with a senior partner. When the senior partner owns the onsite mill, they are motivated to find additional feed for it. An initial 4-year mine life, nearby inferred resources, another feasibility study underway elsewhere in the camp and an entire pipeline of drill targets really shows that the Donner-Xstrata team symbiotically help each other out by reducing the risks of exploration.
I say congrats to the Donner team for reaching their earn-in milestone, the upcoming project financing milestone, and wish them continuing success at the Matagami Project in the future.
http://www.gold-speculator.com/grandich-blog/53903-grandich-client-donner-metals.html
April 26, 2011 05:22 AM
Donner Earns In, 19 months to Production and Cash Flow
The news out today for Donner Metals reports that they have completed their earn-in on the Matagami zinc-copper project in Québec. This milestone has been in sight for a while, but it is important to note the accomplishment. It is well-deserved, and quite frankly impressive that in the relatively short 5-year period they have made an award-winning new discovery, are in the process of developing a mine, and are now sitting at a mere 19 months from first production.
The large volume and sideways trading we saw was IMHO putting a cap on the stock, in large part due to legacy warrants from the financings done to keep the company going after the global financial shocks in 2008. Donner’s Chairman David Patterson is a long-time friend with a well-deserved reputation for being able to raise capital in both bull and bear markets. Donner is working towards the financing necessary for the project which pays Xstrata back for what they’ve already spent on Donner’s behalf for the new mine.
The new mine went into construction in July 2010 months ahead of Donner receiving the positive feasibility study because Xstrata has their own timeline of events and are sticking to that. Xstrata has their own mine currently in production in the camp, and it should be completely mined out by late 2012; in order to eliminate lag time and prevent their onsite mill from shutting down, it’s believed Xstrata accelerated the development of the new Donner-Xstrata mine to come into full production by January 2013.
Today’s news shows that development is well on the way to meeting that target, with the ramp construction already down 900 metres of the necessary 2.3 kilometres, (about 1.43 miles).
In the past I’ve offered Donner up as a possible takeover candidate for Xstrata, but with this earn-in and announcements of $4 million/year anticipated for exploration moving forward in 2011, it really shows that a junior can go into production with a senior partner. When the senior partner owns the onsite mill, they are motivated to find additional feed for it. An initial 4-year mine life, nearby inferred resources, another feasibility study underway elsewhere in the camp and an entire pipeline of drill targets really shows that the Donner-Xstrata team symbiotically help each other out by reducing the risks of exploration.
I say congrats to the Donner team for reaching their earn-in milestone, the upcoming project financing milestone, and wish them continuing success at the Matagami Project in the future.
http://www.gold-speculator.com/grandich-blog/53903-grandich-client-donner-metals.html
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