Re: Lubows' POS idea is Golden to this GOYM

Hey, rob, things change and in this crazy market, they change at the
drop of a hat. For some metals, juniors may be right, but that does
not change the economics of gold mining. Unless you have a producing
mine, creating a gold mine out of test drills is one expensive
propositions



On Mar 14, 8:50 am, Nomen Nescio <nob...@xxxxxxxxx> wrote:
Gold junior to seize platinum opportunity
Both RBC and Great Basin Gold says it is opportune for a gold junior to move
into the platinum space to create a precious metals investment opportunity.
Author: Tessa Kruger
Posted: Thursday , 13 Mar 2008
JOHANNESBURG -
A gold junior is likely to seize an opportunity to acquire a platinum asset
as platinum juniors could represent a good bargain and will boost a gold
company's cash flow.
Both top platinum analyst, Leon Esterhuizen (RBC Capital) and Great Basin
Gold (TSX:GBG,JSE:GBGOLD) CEO Ferdi Dippenaar said recently the climate might
be good for a junior gold company to get involved in the South African
platinum sector.
Esterhuizen said in a recent report that platinum mines remained bargains for
gold companies as PGM junior stock prices weren't increasing as rapidly as
the majors. This was unusual as the majority of platinum juniors had shallow
mines and good growth profiles.
"Gold companies could grab this opportunity, especially if they can pay with
shares and wait four to five years to production. Although metal prices could
decrease, platinum mines generate a huge amount more cash than gold mines as
they produce seven or eight metals."
Esterhuizen said RBC continued to believe that a gold mining company would
shortly get involved in the PGM space - buying cash flow and margin with high
P/E paper.
Meanwhile, GBG President and CEO Ferdi Dippenaar told Mineweb today it was
opportune for the company to add platinum ounces to its resources in an early
stage and to develop both gold and platinum projects simultaneously.
He said Great Basin should attain good trading multiples as it goes into
production. The case for adding platinum was strengthened by the fact that
precious metals attained good prices, platinum and gold demanded similar
mining methods and platinum would expose Great Basin to the same country (SA)
risk.
The company did not carry the burden of historic rivalry between gold and
platinum sectors and it was in a unique position to acquire platinum, while
this proposition did not even occur to gold majors.
Dippenaar said the company would consider opportunities to take a platinum
exploration project on board as its gold assets grew.
"We are looking at opportunities in exploration and at the exploration
projects of junior companies that could possibly fit the profile."
He said gold and platinum would be a good combination and an opportunity to
offer investors a different value proposition - to invest in precious metals.
However, as far as Great Basin Gold was concerned it was still investigating
opportunities to get involved in platinum mining.

Dippenaar said the reverse scenario of a platinum company acquiring gold
assets or company was unlikely as the gold industry was generally struggling
and in a "sunset" phase, while platinum companies were experiencing their
best cycle yet.
"Why would a platinum company get involved in conventional gold mining seen
as dangerous in South Africa?" he said.
Major gold companies could not afford to diversify into platinum and only a
very large amount of PGM production would make a difference to a gold major's
production and cash flow.
Dippenaar said ten years ago gold companies did not want to sacrifice their
gold trading multiples by acquiring cheap platinum ounces, but the situation
has changed with the platinum price soaring to record levels.
Kobus du Plooy, executive director of Pamodzi Gold (JSE:PZG), however, said
the company would not pursue platinum projects in the near to medium term as
it was focused on reaching its target of 1m gold production ounces by 2009.

.

Relevant Pages

  • Lubows POS idea is Golden to this GOYM
    ... Both RBC and Great Basin Gold says it is opportune for a gold junior to move ... into the platinum space to create a precious metals investment opportunity. ... Leon Esterhuizen and Great Basin ...
    (misc.invest.stocks)
  • Re: Irrational exuberance // Quixotic Watch Company Launch Party in Las Vegas...
    ... For the last 4 to 5 years, my husband has been working with local ... artisans in creating hand crafted watches from gold and platinum. ...
    (alt.horology)
  • Re: OT: Pierced ears
    ... reasonable price if you want gold. ... mixed with silver, rhodium, nickel, palladium or other "white" metals. ... Platinum jewelry is usually pure platinum but it is very expensive. ... I can wear them for max about three hours before my ears ...
    (rec.crafts.textiles.needlework)
  • Re: Opening the High Frontier of Space
    ... :> find gold in my back yard it's a gold mine". ... :Ceres Platinum might just work. ... being enough to go round - the price goes up. ...
    (sci.space.policy)
  • Re: Railroad Tycoon 3??
    ... in gold, then platinum as GoD tried to milk a bit more money out ... >> steel loads can move across the map to their destination along a ... >> It adds a lot more strategy to the game. ...
    (comp.sys.ibm.pc.games.strategic)