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| | Corporate Profile: Aurizon Mines Ltd
Publisher: Kaiser Research Online
Author: Copyright 2013 John A Kaiser
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Aurizon Mines Ltd (ARZ-T)
| Aurizon Mines is a gold producer with a growth strategy focused on developing its existing projects in the Abitibi region of north-western Quebec. Aurizon has 11 properties in Quebec, including Casa Berardi, the company's flagship operating gold mine, the Joanna property, which is in the feasibility stage, and a significant project pipeline. Led by Chairman David Hall and President and CEO George Paspalas, the company expects production of approximately 165,000 ounces of gold during 2011 from Casa Berardi, where proven and probable reserves are 1.4 million gold ounces, with a further 1.4 million ounces in the measured, indicated, and inferred categories. At the 2.5 million gold ounce Joanna property, an updated feasibilty study is expected during Q2 of 2012. In January 2013 Alamos Gold announced a $780 million takeover offer at $4.65 per Aurizon share or 0.28 Alamos share per Aurizon share. In March 2013 Hecla announced an improved offer of $796 million in cash and shares, and Aurizon management agreed to the offer. |
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. |
| Heva and Hosco West |  | 100% WI | Canada | 7-Permitting & Feasibility |
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| Joanna-Hosco 43-101 Economic Study (USD except where noted otherwise) |
| BFS | Jun 5, 2012 |
| BBA Inc | Joanna-Hosco |
| Mining Scenario | TR | Mining Costs |
| Mining Type: | OP |
| Cost Currency: | USD |
| Processing Type: | CIP |
| Capital Cost: | $442,000,000 |
| Operating Rate: | 8,500 tpd |
| Sustaining Cost: | $97,000,000 |
| Operating Days: | 365 |
| Operating Cost: | $25.32/t |
| Strip Rate: | 4.5 |
| BC Cash Cost per Unit: USD | $757/oz Au |
| Mine Life: | 13 years |
| BC Cash Cost Net By-Products: USD | $757/oz Au |
| LOM Tonnage: | 41,100,000 t |
| BC All-In Cost Net By-Prod: USD | $1,129/oz Au |
| Est Startup: |
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| Spot All-In Cost Net By-Prod: USD | $1,129/oz Au |
| Production Potential |
| Metal 1 | Metal 2 | Metal 3 | Metal 4 |
| Metal: | Au |
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| Grade: | 1.26 g/t |
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| Recovery: | 87.5% |
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| Annual Output: | 103,785 oz |
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| LOM Output: | 1,450,000 oz |
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| Base Case Price: | $1,350/oz |
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| Spot Price: | $1,315/oz |
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| Base Case NSR: | $45.16/t |
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| Spot NSR: | $43.99/t |
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| Base Case Valuation |
| Reported Valuation Currency: | USD |
| Pre-Tax NPV: | $111,600,000 |
| Discount Rate: | 5% |
| After-Tax NPV: |
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| Total Base Case NSR USD: | $45.16/t |
| Pre-Tax IRR: | 9% |
| Total Spot NSR USD: | $43.99/t |
| After-Tax IRR: |
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| Annual Pre-Tax Cash Flow Base Case and Net CF/FDSH USD: | $61,554,450 | $0.32 | Pre-Tax Payback: | 10.3 y |
| Annual Pre-Tax Cash Flow Spot and Net CF/FDSH USD: | $57,927,164 | $0.30 | After-Tax Payback: |
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| Enterprise Value CAD : | $584,405,100 | $3.49/sh | Share Price: | $4.10 |
| Note: |
| Comparative Valuations using Life of Mine Averages |
| Discount Rate: | 0% | 5% | 10% | 15% |
| Base Case Pre-Tax NPV USD: | $261,207,850 | $62,976,869 | ($52,507,983) | ($121,731,588) |
| Base Case Pre-Tax Net NPV/Sh USD: | $1.56 | $0.38 | ($0.31) | ($0.73) |
| Premium BC PT NPV over EV: | ($1.15) | ($2.34) | ($3.03) | ($3.44) |
| Spot Pre-Tax NPV USD: | $214,053,135 | $30,526,228 | ($75,931,531) | ($139,341,735) |
| Spot Pre-Tax Net NPV/Sh: | $1.28 | $0.18 | ($0.45) | ($0.83) |
| Premium Spot PT NPV over EV USD: | ($1.43) | ($2.53) | ($3.17) | ($3.54) |
| 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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