Opinions
Rick Rule
Belo Sun Mining
BSX-T
PAST TOP PICK
Aug 06, 2013
Stock price when the opinion was issued
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The Volta Grande project had a feasibility study done last year. Agnico- Eagle (AEM-T) put in $15 million to go through the permitting cycle. Doesn’t know how long it will take in permitting. This project also has substantial exploration potential. At current gold prices, that asset is worth putting into production. Expects this company will be absorbed in the not too distant future.
They want to build a mine in Brazil, but there are some environmental controversies. They have the Volte Grande project which is over 6.1 million ounces in all categories, and a grade over a gram a ton. In early years, they can have higher grades, so you get a really robust payback. From a technical perspective, everything is great.
An explorer/developer. It certainly hasn’t performed the same as Continental Gold. Has shown more volatility. Brazil obviously can be a difficult environment. He thinks they are appealing an injunction on their deposit. In South America, the social license is very difficult, and he thinks that is the overhang with the stock. He has avoided this.
They have some issues with locals. They re-submitted an indigenous document and so we have to see what happens. It is a leveraged play in the Amazon.
(A Top Pick March 5/13. Down 53.47%.) This one was a mistake. He had a view as to what the front-end capital costs would be and what the pit would look like. He was wrong and sold his holdings. He would not buy this. He likes the people and there are some things about the deposit that he likes. It won’t work at $1250 gold.