A review by GR Engineering has concluded that the Ravensthorpe Gold Project should be able to generate gold dore and gold-copper-silver concentrate using an industry standard gravity-float-CIL processing route. This has given us the comfort to develop a mining model as a basis for valuation. Using the existing 674koz Au Resource estimate and assumed increases to the Resource outlined in our recent note as a starting point, we model a nominal eight year mine-life producing an average of 50kozpa. We derive a project level NPV7 of $147M for the Ravensthorpe Gold Project, and a net-asset valuation of $76M. We see this valuation as a starting point for Medallion, with plenty of untapped exploration upside we expect the project to continue to grow. We maintain our Speculative Buy recommendation.
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