Jeb Handwerger, editor of GoldStockTrades.com, recommends International Tower Hill(THM_) in Alaska as a good way to play this take-out theme. International Tower Hill has what big miners want -- 100% ownership of the 20th-largest gold deposit in the world, Livengood. It ranks in the top 2% of gold discoveries over the past 20 years. The mine could produce an average of 562,000 ounces of gold over a 23 year life, delivering 664,000 ounces of gold during the first five years.
The company has 7 more years of feasibility, permitting and construction ahead of it before it will start producing gold. Although it has $116 million in cash and no debt, its capital costs will still reach $1.6 billion -- all preproduction cost. Costs might be helped, however, by a new development. Tower Hill recently bought the land rights to an area near Livengood originally used for placer gold mining -- gold that was originally at Livengood but has been moved over decades by rain and now lives in valleys at the base of the deposit. Tower Hill now owns that land.
Due to the concentration of gold, the grade is 3 to 4 times higher than the average grade at Livengood, according to the company. Tower Hill is working on a preliminary economic assessment which will provide cash costs and production capability, but the company now has the ability to become an overnight producer and use the cash to fund construction and production at Livengood. This might eliminate the need for Tower Hill to issue shares to raise cash and might make it even more appealing for a major searching for gold
http://www.thestreet.com/story/11351700/2/gold-prices-poised-for-11th-year-of-gains-in-2012.html
The company has 7 more years of feasibility, permitting and construction ahead of it before it will start producing gold. Although it has $116 million in cash and no debt, its capital costs will still reach $1.6 billion -- all preproduction cost. Costs might be helped, however, by a new development. Tower Hill recently bought the land rights to an area near Livengood originally used for placer gold mining -- gold that was originally at Livengood but has been moved over decades by rain and now lives in valleys at the base of the deposit. Tower Hill now owns that land.
Due to the concentration of gold, the grade is 3 to 4 times higher than the average grade at Livengood, according to the company. Tower Hill is working on a preliminary economic assessment which will provide cash costs and production capability, but the company now has the ability to become an overnight producer and use the cash to fund construction and production at Livengood. This might eliminate the need for Tower Hill to issue shares to raise cash and might make it even more appealing for a major searching for gold
http://www.thestreet.com/story/11351700/2/gold-prices-poised-for-11th-year-of-gains-in-2012.html
