##{"id":84844,"date":"2020-02-12T09:21:47","date_gmt":"2020-02-11T22:21:47","guid":{"rendered":"https:\/\/www.fnarena.com\/?p=84844"},"modified":"2020-02-12T09:21:49","modified_gmt":"2020-02-11T22:21:49","slug":"research-big-river-gold-big-river-big-opportunity","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2020\/02\/12\/research-big-river-gold-big-river-big-opportunity\/","title":{"rendered":"RESEARCH: Big River Gold, Big River, Big Opportunity"},"content":{"rendered":"

Pitt Street Research has initiated coverage of Big River Gold, developer of the Borborema Gold Project in north eastern Brazil<\/em><\/p>\n

By Pitt Street Research<\/p>\n

Strong economics obtained from DFS<\/strong><\/p>\n

Big River Gold ((BRV)) is developing the Borborema Gold Project in north eastern Brazil. In December 2019, a Definitive Feasibility Study (DFS) at Borborema has been completed demonstrating compelling economics of the project, allowing Big River to advance financing discussions with various lenders in the immediate future.<\/p>\n

Subject to financing, Big River intends to commence mine construction in 2020 and envisages a ~71K oz pa operation with an >10-yr mine life. The first 4.5 yrs will see an average 85K oz pa production at an AISC of US$759\/oz.<\/p>\n

A potential doubling of the project coming?<\/strong><\/p>\n

Big River had previously proposed, in its February 2018 optimisation of a 2013 Feasibility Study, an open-pit project processing 2 Mtpa. And yet, the most recent DFS provided reduced capital and operating costs with even stronger project economics.<\/p>\n

However, we see potential for a larger operation once the economics of the new flowsheet have been properly costed. There are sufficient resources to justify a review into expanding production rates up to 4Mtpa, which is the limit approved by the current environmental and construction permitting.<\/p>\n

Valuation range of $0.094–$0.150 per share<\/strong><\/p>\n

Based on data only provided in the DFS, we have valued Big River on a DCF basis with a range of 9.4 cps base case to 15.0 cps optimistic case. No value is assigned to the exploration upside, likely Stages 2-3 of mining and additional resources and reserves or by-product credits.<\/p>\n

We see Big River being re-rated by the market based on five main factors: the higher and strengthening gold price; the return to favour of Brazil with international investors; cost improvement identified in the DFS; advanced state of permitting and lack of a tailings dam requirement; and favourable location within Brazil.<\/p>\n

Download the full report<\/strong><\/p>\n

Earlier today the report above was released by Pitt Street Research for which FNArena is a partner in distribution. The full report can be accessed here:<\/p>\n

https:\/\/www.fnarena.com\/index.php\/pitt-street-research\/BRV\/<\/a><\/p>\n

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