Big River Gold Gets an 18% Share Price Boost (ASX:BRV)

Big River Gold Gets an 18% Share Price Boost (ASX:BRV)

Big River Gold Ltd [ASX:BRV] released an update today on their Borborema Gold Project, which is the ASX-listed explorer’s main focus.

The Borborema Gold Project is located in Seridó, within the State of Rio Grande do Norte in Brazil. Borborema holds three mine leases in a 29 square metre area and a freehold title to the property covering the main prospect in the area. In Stage 1, Big River Gold expects they’ll produce 729,400 ounces of gold over 10.2 years, which is a fraction of the 2.43 Moz mine resources and 1.61 Moz reserves.

Pandemic affecting Big River’s operations

With the pandemic still raging in Brazil, their onsite activities have taken a hit. They haven’t been able to get construction teams to the site and the soonest they expect they’ll be able to do this is early 2021, when they believe restrictions will relax.

In the meantime, though, they are looking for expressions of interest from construction teams and have sent out invitations to a select few with experience in developing and commissioning similar sized projects in Brazil.

ASX BRV Share Price - Big River Share Price

Source: Big River Gold

The company is still looking for funding for the project. So far, they haven’t had much luck in Brazil with all the volatility and travel restrictions.

Yet the company said they’ve appointed Auramet International LLC to help them with securing debt funding for the project.

Auramet is a precious metals trader based in the US, with presence in Latin America, South Africa, England, and Australia. According to Big River Gold, the company has extensive experience in the global junior mining market, mining finance, and in the Brazilian gold sector.

The company also took advantage to update on the test work to produce a saleable mica concentrate from the Borborema plant. According to the announcement, so far, it’s going well, and August results were ‘very encouraging’.

Finally, Big River Gold said they’ve received the final payment for the Posse iron ore sale in 2017. This amounted to 3.5 million reais or about AU$920,000.

Higher gold prices bring better prospects for Borborema Gold Project

At the time of writing, BRV share price are trading at 5.9 cents, an 18% increase from yesterday.

So far, the company has gained 51% since the end of July when they reviewed their Definite Feasibility Study (DFS) which they had made public in 2019.

The review reduced their start-up capital costs to US$90.7 million, which includes a contingency provision of US$11.3 million. They also reduced their average all in sustaining costs (AISC) to US$713 per ounce of gold over the 10.2 years scheduled for production.

The updated model increased the pre-tax net present value of the mine from $233 million to $342 million after updating the gold price to US$1,550 per ounce from the US$1,400 earlier.

Truth is that gold has been on a stellar run this year, with prices up by close to 28% in US dollars. On that note, if you are looking to buy physical gold, check out Shae Russell’s step-by-step guide on the ‘Best Way to Buy, Sell, and Store Gold’.

To read the report, click here.

Best,

Selva Freigedo,
For The Daily Reckoning Australia