10.26
consensus had set a mark of 500,000 gold ounces being added to the portfolio by the end of 2010. The company has exceeded this figure by 200,000 ounces in less than 7 months.
On an integrated basis the Bajo Negro currently has almost the same NPV as Eureka, assuming the latter carries most of the burden of construction capital. We think that the limits to mineralization have not been defined at either spot and other targets are likely to be fruitful.
An extra ounce found at the Eureka Zone is worth more than other
development projects due to its near-term production and low cost. Gold needs to be found 10x faster at Pascua in order to generate the same 10% NPV effect at current gold prices of $1,050/oz.
Valuations for quality assets are always higher than other deposits on the market. We find that Andean is trading at levels below those in production but is trading at a premium to undeveloped projects as expected. The deposit continues to be first-in-class for new-found ounces.
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