Worth the reminder of what we have here....

The full Journal review may be found at http://miningmarketwatch.net/MTO.htm online.

 

Metanor Resources Inc. (TSX-V: MTO) (US Listing: MEAOF) is expected to prepare a bulk sample in Q4 2011, leading to a ramp-up in production that will see a run rate of 5,000 ounces gold per month (60,000 oz per annum) by Q3 2012 at an estimated cash cost of US$464/oz (pre-feasibility by Stantec) gold using 2/3 capacity at their newly refurbished 1200TPD Bachelor Lake Mine & Mill, in Quebec. MTO is leveraged to the price of gold, able to sell 80% of its Bachelor Lake Mine sourced gold at spot prices with the balance sold to Sandstorm as per gold participation agreement. On schedule, fully capitalized and debt free, MTO.V presents investors with an exceptional opportunity as it enters gold production.

 

A recent analysis by National Bank Financial of Sandstorm's 20% interest in the Bachelor Lake sourced ore for the initial years of production values Sandstorm's 1/5 interest at over $50M using $1760/oz gold. Hence, extrapolating the remainder 4/5 that belong to Metanor would place Metanor's portion of the initial years production at over at $200,000,000 (before factoring the reality MTO.V will cost out portions of these proceeds for expansion of resources and mine life, further adding shareholder value). This money is only from the first few years of production and validates our theory the share price (market cap) of MTO.V is destined substantially higher. Metanor has ~$15M in the bank (as of September 2011) and has no need for further dilution.

 

Metanor's infrastructure is valued (estimated replacement value) between CDN$150M - $200M, is fully paid, fully permitted, fully functional with proven production capabilities (having poured >40K oz gold from interim sourced ore with ~95% recovery). The intrinsic value of Metanor’s known resources (~1.6M oz gold in all categories on all its properties) and infrastructure are several times the company’s current market capitalization. As MTO.V enters gold production the reality of the infrastructure and resource value, cash flow growth, and clear ability to add ounces should lead to share price appreciation. 

 

Sprott Asset Management has taken an equity position in MTO.V and for good reason; with two projects of significance that together many believe will take Metanor Resources to mid-tier producer status (between 150,000 oz - 200,000 oz Gold per annum) within 2.5 years, the time to pay attention is now while MTO.V is trading at a fraction of its infrastructure value (close to book value) and entering gold production. With strong cash flow growth, strong organic resource growth, and sitting geographically as the only mill located within 200 km in a gold rich district, MTO.V with 201.7M shares outstanding (~257M fully diluted) the share price appears destined higher.

 

The full Journal review may be found at http://miningmarketwatch.net/MTO.htm online.


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