EnviroGold Limited (EVG:ASX) - Penny Stock Gold Play With Big Upside
Although the Dominican Republic may not seem to be one of the world’s most prolific gold regions, Barrick Gold and Vancouver-based Goldcorp plan to invest over $3 billion USD in their Pueblo Viejo mining project in the region. In fact, Barrick Gold announced earlier this year that their investment in the project which now has over 400 employees was made easier because of the confidence the company has in the stability of the Dominican Republic.
Unbeknownst to many mining industry investors, gold has been produced in the Dominican Republic for almost 500 years. Based in Australia, EnviroGold (EVG:ASX) has invested over US$22.5 million in its Las Lagunas Project in the Dominican Republic which has included acquisition costs, resource definition, metallurgical testwork, pilot plant studies, feasibility studies, engineering, sitework, procurement of major equipment, project management and holding costs.
EnviroGold has been listed on the Australian Exchange since 2006. The company is focused on Latin American properties with residual deposits of polymetallic and refractory ore In addition, the company is pursuing high grade gold and silver tailings that were not developed to full potential because of inefficient previous operations. In order to work these properties , EnviroGold uses Xstrata Technology’s ALBION PROCESS which offers a simple, robust and more cost effective solution for many refractory ores than alternative technologies such as roasting, pressure or bacterial oxidation. The key to the Albion Process is the Isamill ultra-fine grinding stage.
Based in the Dominican Republic, the Las Lagunas Gold Tailings Project is expected to produce 434,000 oz Au and 3,966,000 oz Ag over the 6.5 year projected life. To date, EnviroGold has spent $22.5 million on the project. EnviroGold will invest a total of $25 million. As a result, EnviroGold will achieve a 73% economic interest in the property and will also act as Manager. The total project cost will be $72.5 million. With an assumed gold price of USD$900/oz and an assumed silver price of $11.75/oz, the project is projected to post a total operating profit of $252 million over the project life. The Las Lagunas Project is situated in very close proximity to Barrick Gold’s Pueblo Viejo property. EnviroGold believes that the existence of the Albion plant will create the opportunity for numerous joint ventures within a 50km radius. Las Lagunas construction is expected to begin in October of this year.
EnviroGold has identified a number of projects in Peru(Trujillo Gold Mining Project) that could collectively produce around 75,000 oz Au per year for 10 years. EnviroGold is working on the acquisition of a number of dormant mines which could potentially support a central Albion Plant which would service all the company’s concessions in Northern Peru. The construction is expected to begin in 2012.
On July 22, 2009, the Company announced that it completed a placement of 40,000,000 shares at $0.05 for a total capital raise of $2,000,000. The Company announced that its financial obligation to the Las Lagunas Project is fully funded. As previously announced, the project is also being funded by Macquarie Bank, a Dominican Bank and a joint venture partner.
With a current public market value of $15,000,000 and a potential $79 million in after tax profit from the Las Lagunas project, EnviroGold may just be one of the most undervalued resource companies on the Australian Stock Exchange.
More information can be found on EnviroGold Limited at the Australian Stock Exchange website
Notice:
1800blogger.com, Inc. has been compensated $6,o00 by EnviroGold Limited to publicize the EnviroGold (EVG:ASX) story to investors. Please read the rest of our disclaimer which could be found by clicking on the link (disclaimer) at the top of any page on this blog. EnviroGold Limited common stock and the company are not currently registered with the United States Securities and Exchange Commission.
