Fundamental re-rate is coming as Enchi project's 'potential is fully realized' - Newcore Gold's Luke Alexander

Despite high metal prices, it is still a challenging market for juniors, said Luke Alexander, president and CEO of Newcore Gold.

Last week Alexander spoke to Kitco Mining at the 2024 Precious Metals Summit Beaver Creek in Colorado.

Newcore Gold Ltd. (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 per ounce, the company showed a $586 million pre-tax net present value discounted at 5% and a 77% pre-tax internal rate of return. The average annual gold production was estimated at 120,000 ounces.

In June the company announced that it was starting a 10,000-metre drill program focused on infill and resource expansion drilling. In September the company announced a $5 million private placement financing at 29 cents.

“We've been able to continuously move the project forward, despite it being a difficult market,” said Alexander. “This capital raise is another example of where we'll be able to deploy this capital to create a lot of additional value for the project.”

“There's a significant disconnect between the value of our project and where the company is trading today,” said Alexander. “So I think that's part of the reason why we saw such strong support for the financing.”

Ghana has embraced mining, said Alexander. The Chirano Mine, owned by Asante Gold (previously Kinross Gold), is located 50 kilometers to the north. Chirano produced ~155,000 ounces of gold in 2021 and ~165,000 ounces of gold in 2020. Other mines are being advanced nearby.

“So that really speaks to the government's desire to see mines being built and a recognition of how important it is for the economy,” said Alexander.

Coverage of the 2024 Precious Metals Summit Beaver Creek in Colorado is sponsored by Newcore Gold. 

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.