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Shanta Gold on a roll, suggests Liberum

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Shanta Gold (LON:SHG) is on a roll, reckons house broker Liberum, which sees catalysts coming thick and fast for the Tanzania–based miner.

Already this year, Shanta has announced a reserve/resource upgrade at its flagship New Luika mine and a maiden reserve at Singida, also in Tanzania.

But over the remainder of the year production form New Luika should rise to 80,000 oz while there is the potential for the mine life to double.

Shanta has also extensive exploration upside, with only 5% of the Lupa Goldfields explored so far, while Singida offers the potential for low cost, low execution risk production.

Liberum said: “Shanta is entering a year full of important catalysts which have the potential to re-rate the stock to peer valuations.

“With the New Luika gold mine operating consistently above design capacity, the next step is to expand the plant and extend the mine life.

“Beyond New Luika, and the huge exploration upside in the Lupa Goldfields, production growth will come from the company’s next mine Singida, where a feasibility study update is due for completion end Q2’14.”

The broker’s price target is 23p and it has a ‘buy’ rating.

Shares today were 13.1p.


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