HIGH-GRADE NI-CU-PT-PD-ZN-CR-AU-V-TI DISCOVERIES IN THE "RING OF FIRE"
NI 43-101 Update (September 2012): 11.1 Mt @ 1.68% Ni, 0.87% Cu, 0.89 gpt Pt and 3.09 gpt Pd and 0.18 gpt Au (Proven & Probable Reserves) / 8.9 Mt @ 1.10% Ni, 1.14% Cu, 1.16 gpt Pt and 3.49 gpt Pd and 0.30 gpt Au (Inferred Resource)
Message: Wellington West Nov 23/09 Anayst report. Appologies for format. Peter
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Please see disclaimers on the last two pages of this report. Mining & Minerals Noront Resources Ltd. (NOT-V, $2.31) Recommendation: Buy Steve Parsons, P. Eng (416) 640-4950; sparsons@wwcm.com Ryan Walker (416) 640-4971; November 23, 2009 All values in C$ unless otherwise noted. Current Price $2.31 Target Price (12-Month) $2.80 Target Return 21% Changes Old New Recommendation Buy Unchanged Target $2.50 $2.80 Company Profile Noront Resources Ltd. is a Canadian-listed exploration company focused on the 100%- owned McFauld’s Lake nickel-copperplatinum- palladium (chromite, gold, and vanadium) project in the James Bay Lowlands of northern Ontario. www.norontresources.com Cliffs Natural Resources Bid for Freewest Legitimizes McFauld’s Chromite District • Cliffs’ all-share $0.55/sh bid values Freewest’s chromite at $118mm.
Values FWR’s Black Thor, Black Label & 50% of Big Daddy chromite at $118mm; validates our $150mm valuation of NOT’s Blackbird. • Bid could spur further M&A in the Ring of Fire chromite camp.
Early days, but increased potential of low-cost production from the Ring of Fire could force power-challenged South African producers into action. • Potential development by Cliffs could ease Noront’s operating costs.
Potential to share regional infrastructure developed by Cliffs could help ease Noront’s future operating costs – trucking versus hoverbarging. • Maintain Buy rating; increasing target to $2.80 from $2.50.
Target based on a 0.85x multiple of NAV of $3.31/sh ($3.17/sh old).
See up to $4/sh by selling chromite/PGM stream & exploration success. Financial Summary Shares, basic (mm) 163.6 52-Week Range $0.435 - $3.01 Shares, f.d. (mm) 173.5 Avg Weekly Volume 6,120,391 Shares, f.d., f.f. (mm) (1) 216.7 Fiscal Year End Jan-31 Market Cap (mm) $374.7 NAV/Share, f.d., f.f.(1) $3.31 Working Capital (mm) $40.4 P/NAV 0.7 x Key Properties: Status: Eagle's Nest (LOM avg)) Eagle's Nest, Canada (100%) Annual Ni production - payable (000 lbs) 29,548 Polymetallic, Ni-Cu-PGM Annual Cu production - payable (000 lbs) 18,327 Total Cash Costs (US$/lb Ni, after credits) 0.80 Blackbird, Canada (100%) Estimated start date H1/2015 Chromite Pre-Feas for Eagle's Nest H2/10 Key Management: Strategic Shareholders: Wes Hanson President and CEO Management (2%) Joseph Hamilton Chairman Paul Semple COO Gregory Rieveley CFO James Atkinson Director of Exploration (1) Assumes positive development decision on Eagle's Nest and associated equity issue. Source: WWCM Estimates, Company Reports
17 Recommendations
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