Argonaut Congratulates 88 Energy Limited on Successful Debt Refinancing

Argonaut advised 88 Energy Limited (ASX: 88E) (“88E”) on the refinancing of its outstanding loan of US$16.5 million with Bank of America.
Whilst the commercial terms of the agreement remain confidential, the transaction was completed on substantially similar terms to the original loan agreement.


Morning Notes

The Dow Jones Industrial Average fell more than 100 points intraday after President Donald Trump called off a summit with North Korea, hitting investors with a new wave of uncertainty. News of the cancelled summit came within 30 minutes of the stock market's open, pulling down major indexes that were already showing signs of weakness. Investors had hoped the summit, which was scheduled for June 12, would ease tensions between the two countries and bring some stability to the Korean Peninsula. Instead, talks ahead of the summit stumbled after Pyongyang refused demands to denuclearize. The Dow declined 75 points, or 0.3%, to 24812 in recent trading, paring its earlier decline of more than 200 points, while the S&P 500 fell 0.2%. The Nasdaq Composite slipped 0.2%. The US gold price gained 0.9% to 1,304.10 (US$/oz).

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Latest Research

Argonaut recently attended a site visit to Doray\'s (DRM) Deflector Mine. We noted a number of recent changes which potentially change project scope going forward. These zones are yet to be incorporated into reserves and the Deflector mine plan, but we see considerable potential for the new mineralisation to add to the mine life and production upside. On our new modelled forecasts DRM trades at an undemanding 4x EV/FCF for FY19, incorporating our forecasts for ~80kozpa Au production and 3.5Kt Cu at AISC of <$1,000oz. Key news flow will include resource upgrades and the potential for increased production via the development of the Link Splay and Da Vinci Lodes by mid-year. BUY (prior HOLD), TP $0.41ps.

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