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Further to the junior gold study we published on December 16th, here is one company from that list that stands out from the pack. That original table of gold stocks is available here if you have not seen it already.
http://www.stockhouse.com/Columnists/2011/Dec/16/Shockingly-Low
-Gold-Ounce-Valuations-on-48-TSX
I. Volta Resources (TSX: T.VTR, Stock Forum; 97 cents)
www.voltaresources.com
Shares outstanding: 155 million
Working capital Sept 30th: $55 million
Last financing: August 2011 - $40 million at $1.90
Strong resource base & exploration potential for 2012
Volta has a very strong balance sheet and undervalued gold assets. In this weaker economy and stock market, cash is king. When we combine this with three million ounces gold (measured & indicated) and another 1.3 million ounces inferred, the gold is being valued at less than $30 per ounce. This low gold valuation, the cash and the fact VTR trades near the 52-week low, makes the stock a very attractive speculation for 2012.
Volta has nine exploration projects in Burkina Faso, Ghana, and Mali. West Africa is well known for having multi-party democratic governments, host to many world-class gold deposits, industry-friendly mining codes and regulations, an experienced labour force, and very good infrastructure with nearby sea ports. It is also a very promising region for new gold discoveries, which is attracting attention from major mining companies around the world.
Volta’s core project is called Kiaka. This is the project that has a 43-101 compliant resource of 3,018,000 ounces gold (measured and indicated) and 1,260,000 inferred ounces. The resource is contained within one open pit to a depth of 425 metres. This “excludes” their Gaoua copper-gold project, which (at this stage) contains 1,072,000 ounces of gold and 725 million pounds of copper – a project with a 35 km strike length and significant exploration potential.
The company’s strong working capital not only ensures their drill programs will be well funded throughout 2012, but they will have the capital available to target acquisitions - if strong opportunities arise. This tight economy has made raising capital difficult for many small companies and those with the cash available are in an enviable position.
Outlook
Several weeks ago Volta released further strong drill results but the market just ignored them (a common theme in December). They will continue into 2012 with a very aggressive drill program and are working towards a pre-feasibility study for the Kiaka project. The drilling and exploration is designed to expand the known gold and copper resources on all their projects.
[Excerpt from Nov 29 news release]
"These outstanding results will be incorporated into our next resource estimate and should have a positive impact on the quality of resources and the total amount of resources. These results again display the characteristic exceptional consistency of the Kiaka deposit, with broad widths of notable mineralization. We are also pleased that these results will be incorporated into the parameters of our prefeasibility study, which will be concluded late in first-quarter 2012."
Disclosure: Danny Deadlock owns 15,000 shares of Volta Resources (TSX: T.VTR).
