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| | Corporate Profile: Ventana Gold Corp
Publisher: Kaiser Research Online
Author: Copyright 2009 John A Kaiser
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Ventana Gold Corp (VEN-T)
| Ventana is led by Chairman Richard Warke and President and CEO Stephen Orr. The company is exploring its La Bodega gold vein project in Colombia that is adjacent to Greystar's Angostura deposit. In November 2010 the company released an initial resource estimate of 27 million tonnes grading 3.9 grams per tonne gold (3.5 million ounces), 21.5 grams per tonne silver (19.2 million ounces), and 0.14% Cu (84 million pounds) along with a scoping study showing an initial 14 year mine life producing 220,000 gold ounces annually, with 301,000 gold ounces produced annually during the first six years, with operating costs of $43.72 per tonne and cash costs of $364 per gold ounce, net of byproduct credits. With initial capital expenses of $297 million and using a gold price of $1,000 per ounce the NPV (5%) is $807 million, rising to $1.2 billion at a gold price of $1,200 per ounce. On November 17, 2010 the company received an unsolicited takeover offer from EBX Capital, which already holds 20% of Ventana's stock, for $12.63 per share. In February 2011 the offer was raised to $13.63 and Ventana agreed to the transaction. |
Key to Understanding IPV Charts and Spec Value Hunter Tables
| An IPV Chart is a graphical presentation of a Spec Value Hunter table that has been constructed according to the Rational Speculation Model developed by John Kaiser. The IPV Chart allows speculators to identify which projects offer poor, fair or good speculative value in both absolute and relative terms. The speculative value depends on the project stage, the project's implied value as calculated by the company's fully diluted capitalization, stock price and net project interest, and the dream target deemed appropriate for the project. A dream target is what a project would be worth in discounted cash flow terms once in production. |
| Green background indicates the dream target judged appropriate for this play by John Kaiser - otherwise unranked. |
Poor Speculative Value -   |
Fair Speculative Value -  |
Good Speculative Value -   |
| Note: narrow arrows indicate IPV is outside the fair value channel but within 25% of the fair value limits |
| Click on the company name to view the company profile, the project name to view project details. |
| Click on the project icon if its background is shaded to get the IPV Chart for that company. |
| La Bodega |  | 100% WI | Colombia | 6-Prefeasibility |
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| La Bodega 43-101 Economic Study (USD except where noted otherwise) |
| PEA | Nov 8, 2010 |
| Samuel Engineering | La Bodega |
| Mining Scenario | TR | Mining Costs |
| Mining Type: | UG |
| Cost Currency: | USD |
| Processing Type: | FLOT/leach |
| Capital Cost: | $297,000,000 |
| Operating Rate: | 7,500 tpd |
| Sustaining Cost: | $173,700,000 |
| Operating Days: | 365 |
| Operating Cost: | $43.72/t |
| Strip Rate: |
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| BC Cash Cost per Unit: USD | $503/oz Au |
| Mine Life: | 14 years |
| BC Cash Cost Net By-Products: USD | $326/oz Au |
| LOM Tonnage: | 29,707,000 t |
| BC All-In Cost Net By-Prod: USD | $479/oz Au |
| Est Startup: |
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| Spot All-In Cost Net By-Prod: USD | $480/oz Au |
| Production Potential |
| Metal 1 | Metal 2 | Metal 3 | Metal 4 |
| Metal: | Au | Ag | Cu |
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| Grade: | 3.84 g/t | 22.15 g/t | 0.14% |
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| Recovery: | 86.0% | 89.0% | 88.0% |
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| Annual Output: | 238,000 oz | 1,423,000 oz | 5,954,000 lb |
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| LOM Output: | 3,077,314 oz | 17,306,944 oz | 76,216,182 lb |
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| Base Case Price: | $1,000/oz | $17.00/oz | $3.00/lb |
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| Spot Price: | $1,315/oz | $16.47/oz | $3.10/lb |
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| Base Case NSR: | $86.94/t | $8.84/t | $6.52/t |
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| Spot NSR: | $114.33/t | $8.56/t | $6.74/t |
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| Base Case Valuation |
| Reported Valuation Currency: | USD |
| Pre-Tax NPV: | $807,000,000 |
| Discount Rate: | 5% |
| After-Tax NPV: |
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| Total Base Case NSR USD: | $102.30/t |
| Pre-Tax IRR: | 34% |
| Total Spot NSR USD: | $129.64/t |
| After-Tax IRR: |
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| Annual Pre-Tax Cash Flow Base Case and Net CF/FDSH USD: | $160,369,500 | $1.33 | Pre-Tax Payback: | 2.8 y |
| Annual Pre-Tax Cash Flow Spot and Net CF/FDSH USD: | $235,192,610 | $2.01 | After-Tax Payback: |
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| Enterprise Value CAD : | $1,434,201,457 | $12.94/sh | Share Price: | $13.05 |
| Note: |
| Comparative Valuations using Life of Mine Averages |
| Discount Rate: | 0% | 5% | 10% | 15% |
| Base Case Pre-Tax NPV USD: | $1,774,473,000 | $1,112,024,996 | $720,902,219 | $478,266,874 |
| Base Case Pre-Tax Net NPV/Sh USD: | $16.00 | $10.03 | $6.50 | $4.31 |
| Premium BC PT NPV over EV: | $5.95 | ($0.03) | ($3.56) | ($5.74) |
| Spot Pre-Tax NPV USD: | $2,821,996,540 | $1,817,403,187 | $1,221,991,733 | $850,721,716 |
| Spot Pre-Tax Net NPV/Sh: | $25.45 | $16.39 | $11.02 | $7.67 |
| Premium Spot PT NPV over EV USD: | $15.40 | $6.33 | $0.96 | ($2.38) |
| The comparative NPV calculations assume constant annual cash flow based on the life of mine average annual payable production and CapEx spent in year one. The operating cost includes the LOM sustaining capital. Due to details such as ore scheduling these NPV figures may differ from those of the 43-101 economic study. |
| After-Tax Valuations using Spot By-Product Prices |
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