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Cora Gold* (CORA LN) 9.8p, Mkt Cap £5.4m – Prospective ground, Proven team
- Cora Gold is an AIM listed gold exploration company holding a suite of early stage exploration licenses in Southern/Western Mali and Eastern Senegal.
- The portfolio covers nearly 1,500km2 of prospective ground across two most prolific gold belts in the region, Yanfolila Gold Belt and Kenieba Window, accounting for more than 65moz discovered over the last two decades.
- The 2018 field season focused on the flagship Sanankoro Project Area extending identified zones of gold mineralisation to 8km with the remainder of a 14km long structural corridor remaining untested.
- At Tekeledougou, a short reconnaissance drill programme in 2017/18 intersected close to surface mineralised quartz veins in the layer of weathered material, with the team planning to follow up on identified targets in 2018/19 evaluating potential for low cost selective open pit mining operation with the potential to supply the feed to the recently commissioned Yanfolila plant located only 8km away and operated by Cora’s major shareholder Hummingbird Resources.
- A limited amount of work has been completed over the remaining Group license areas including base level mapping, surface sampling and occasional reconnaissance drilling. Most of the area remains untested, although, extensive areas of present and historic artisanal mining works offer major opportunity for a potential discovery.
- The exploration programme is led by CEO Jon Forster, an exploration geologist with decades of experience in the junior gold exploration space in Africa having been involved in the discovery of major gold deposits in Tanzania, Central African Republic, Mali and Senegal.
- The Company is yet to deliver a maiden mineral resource with the team planning an ongoing drilling programme at the Sanankoro project area this coming 2018/19 field season, targeting higher grade zones within the extensive mineralised strike and collecting data for a potential MRE.
- Geological setting and the scale of anomalism suggest the potential for a reasonable greenfield gold discovery at Sanankoro with the management aiming for a +1moz deposit.
- Considering early- and late-stage exploration companies in the area, market valuation multiples range significantly from as low as $3-4/oz MII (Total Resource) for marginal projects to $43-60/oz for higher grade deposits with an average of $19/oz for our selected sample of names.
- Recognising strong competition for a robust project, we have looked at latest corporate transactions in the region with valuation multiples ranging between $20-55/oz MII for an advanced stage asset; strong balance sheets of major operators in the region and subdued gold prices weighing on valuations provides a consolidation opportunity in the area; although, we would expect Cora to complete more work on the portfolio before it attracts corporate interest.
Conclusion: Cora Gold offers exposure to a portfolio of early stage projects within which there is an extensive drill discovery with typical exploration investment risks minimised by the prospective location of Cora licenses where >1moz discoveries are not uncommon as well as a highly experienced team with a proven track record in West African gold exploration and in-depth knowledge of geology in the region.
*SP Angel act as Nomad and Broker to Cora Gold.
Analysts
John Meyer – 0203 470 0490
Simon Beardsmore – 0203 470 0484
James Mills – 0203 470 0486
Sergey Raevskiy – 0203 470 0474
Phil Smith (Technology) – 0203 470 0475
Zac Phillips (Oil & Gas) – 0203 470 0481
Sales
Richard Parlons – 0203 470 0472
Jonathan Williams – 0203 470 0471
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*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)
+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.
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