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SV Rating: Good Spec Value - Favorite - as of April 13, 2023: West Vault Mining Inc is a 2023 KRO Favorite effective April 13, 2023 at $1.02 with a Good Speculative Value rating based on it positioning itself as a buyout target for a mid tier gold producer interested in developing the Hasbrouck project located just outside Tonopah in Nevada's Walker Lane. The target is a rapid repricing into the $1.50-$2.00 range to reflect fair speculative value, followed by leveraged tracking of higher real price gains (ie a 25% move by gold to $2,500 translates into a 600%-800% move to $7-$9 ahead of a buyout offer involving inflated but liquid paper from a mid tier producer). West Vault is headed by CEO Sandy McVey and Chairman Peter Palmedo whose Sun Valley Gold LLC owns 46% of the stock. Ruffer LLP and Eric Sprott own another 22%. The junior has about $4 million working capital which at the current overhead burn rate and no plans to do additional work at Hasbrouck would allow the company to operate for 4-5 years without any further equity dilution. The board includes highly experienced people like Stephen Quin and Pierre Lebel. The stated goal is to minimize dilution by spending only necessary overhead and foregoing additional feasibility related work or exploring those parts of the property with untested potential. This "gold vault strategy" is designed to maximize the upside when a major gold bull market based on a rising and sticky real gold price emerges and unleashes a scramble among mid-tier producers to expand their mining portfolio. Hasbrouck consists of three low sulphidation epithermal gold systems: Hasbrouck with a proven and probable reserve of 34,370,000 tons of 0.017 opt gold and 0.306 opt silver, Three Hills with a probable reserve of 9,653,000 tons of 0.018 opt gold, and Hill of Gold which has no resource. The reserves are based on oxidized mineralization. Hasbrouck was discovered in 1902 and underwent small scale mining until 1924. Hasbrouck and Three Hills underwent modern exploration from 1974 onward by various groups until 2002 when Newmont merged with Euro-Nevada. Newmont sold the project to Vista Gold in May 2003 which did no work and spun it out to Allied Nevada Gold Corp in 2007. Allied did some work in 2010-2012 and sold Hasbrouck to West Kirkland Mining in April 2014 which advanced the project through to a PFS in 2016 that included securing key permits from the BLM. The enduring bear market in gold took its toll and West Kirkland rolled back 10:1 on July 2, 2020, renaming itself West Vault Mining Inc to reflect a strategy of holding the project as a long term leveraged proxy for gold whose exit would be the acquisition by a producer. West Vault updated the PFS in January 2023 to adjust for recent cost inflation. Since 2014 West Vault has invested about CAD $48 million in Hasbrouck. The recent PFS outlines a two stage development plan, investing USD $66.2 million to mine Three Hills at 15,000 tpd over 2 years, and investing another $117 million in the second year to develop Hasbrouck for 17,500 tpd mining over the subsequent 6 years for an 8 year mine life. Initial, growth and sustaining CapEx total $222 million. OpEx would be USD $10.36 per ton including $4.02 mining per ton ore and $4.67 processing per ton. The operation would involve open pit mining with a 1.1:1 strip rate and cyanide heap leaching with life of mine recoveries of 74.6% for gold and 18.3% for silver. The combined reserve of 44,023,000 tons at 0.017 opt gold (0.58 g per tonne) and 0.239 opt silver would yield 561,000 oz gold and 1,918,000 oz silver. At the base case prices of $1,790/oz gold and $22.50/oz silver the PFS yields an after tax IRR of 51% and NPV of USD $206.2 million at 5% and $149 million at 10% discount rates. At 60.2 million shares fully diluted and a USD:CAD exchange rate of 0.74 this translates into CAD $4.63 per share and $3.34 per share. Under the rational speculation model which assigns a 50% to 75% certainty for the projected outcome the fair speculative value range is $1.67-$2.51 using a 10% discount rate and $2.32-$3.47 using a 5% discount rate. In other words, the stock should be trading in a range of $1.67-$3.47 depending on the market bias from conservative pessimism to aggressive optimism. The stock price at $1.02 thus represents Good Speculative Value offering price appreciation potential of 66% to 242% to position it within the Fair Speculative Value range.
Corporate Change History
#Old for New
Last Price
Prior Name
Subsequent Name
Details
Jun 8, 2010
Name Change
1:1
$0.90
Anthem Ventures Capital Corp (WKM-V)
West Kirkland Mining Inc (WKM-V)
Jul 2, 2020
Name Change
10:1
$0.13
West Kirkland Mining Inc (WKM-V)
West Vault Mining Inc (WVM-V)
Recommendation History
Edition
Date
Price
Recommendation
Gain
SVF2023
4/13/2023
$1.02
Good Spec Value Favorite
0%
Ranking within Company's Price Range based Group
All TSX-TSXV KRO as of Sep 21, 2023
Group Median
Company
Percentile
Score
Price Range:
$0.76-$1.00
Issued:
78,970,433
58,138,670
59.0%
56.4%
Price Group Total:
39
Working Cap:
$4,858,793
$5,599,073
53.8%
TSXV KRO as of Sep 21, 2023
Group Median
Company
Percentile
Score
Price Range:
$0.76-$1.00
Issued:
77,761,025
58,138,670
55.2%
56.9%
Price Group Total:
29
Working Cap:
$4,562,385
$5,599,073
58.6%
Group figures exclude delisted and suspended companies. The higher the company percentile the better, based on the assumptions that the lowest issued shares and highest working capital are best. The score is the average of the percentiles. A percentile is that percentage of a group that a member ranks higher than. Note that issued and WC reflect latest financials.
Ranking Color Code:
Lower than 25%
25% to 50%
50% to 75%
Higher than 75%
Charts & Financing Activity
Most recent 43-101 resource estimate Prior resource estimate PEA PFS FS/BFS/DFS
Private Placement Key
less than $500,000
$1,000,000 - $2,000,000
$5,000,000 - $10,000,000
$20,000,000 - $50,000,000
$500,000 - $1,000,000
$2,000,000 - $5,000,000
$10,000,000 - $20,000,000
over $50,000,000
Private placement financing dates and value ranges are based on transactions reported by the TSXV Monthly Review.
Past Insiders and Reported Shareholders - Current Ownership Status unknown - positions may be pre-rollback
Related Party
Occupation
Related Since
Insider Ended
Director Ended
Capacity
Ownership
Baker Steel Capital Managers LLP
Institution
8/14/2014
6/25/2020
Insider
29,965,000
John S. Brock
Geologist
9/24/2010
6/22/2017
6/22/2017
Director
200,000
Eric H. Carlson
Accountant
4/3/2007
8/14/2014
8/14/2014
Director
1,848,000
Carol Ellis
Broker
11/16/2010
Placee
10,000
Gerald Fabbro
Broker
11/16/2010
Placee
20,150
Kevin Falcon
6/14/2013
6/23/2022
6/23/2022
Director
24,533
Fronteer Gold Inc
12/24/2010
Placee
800,000
Oliver Gilbert
Broker
11/16/2010
Placee
40,300
Karim Jandali
Broker
11/16/2010
Placee
20,200
R. Michael Jones
Engineer
5/28/2020
9/2/2021
9/2/2021
CEO & President
282,191
Benjamin Kendall
Broker
11/16/2010
Placee
20,150
Liberty Metals & Mining Holdings LLC
Institution
4/22/2014
6/25/2020
Placee
42,000,000
Eric Mennell
Broker
11/16/2010
Placee
20,150
Newmont Canada Ltd
Public Company
7/20/2012
Insider
5,244,731
Franco Papalia
Broker
11/16/2010
Placee
20,200
RBC Global Precious Metals Fund
5/28/2010
Placee
1,800,000
Sprott Asset Management Inc
Institution
8/14/2014
Insider
38,481,666
Share positions of current insiders based on last AGM circular, ownership % based on current Issued. Share positions of past insiders and shareholders have not been adjusted for rollbacks or splits.
Active Index Memberships
Membership Start Date:
April 13, 2023
Start Price:
$1.02
KRO Favorites 2023: Features companies designated 2023 KRO Favorites, based on closing price December 30, 2022.
A Spec Value Hunter table allows speculators to identify which projects offer poor, fair or good speculative value according to the rational speculation model. The speculative value depends on the project stage, the project's implied value as calculated by the company's fully diluted, 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.
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
Color Key for Target Outcome Achievability Ranges in millions ranked from most to least achievable
below $25
Should be Private: Artisanal, Placer, Mom & Pop Shop
$25-$50
Tiny Scale: underground mine or quarry - not worth the bother
$50-$100
Small Scale: junior needs to self-develop
$100-$250
Buyout Target: by Lower Tier Producers
$250-$500
Buyout Target: by Mid-Tier Producers
$500-$1,000
Ideal Target for Junior: Buckhorn, Sleeper
$1,000-$2,000
Almost World Class: Ekati, Red Chris, Brucejack, Juanicipio, Stibnite
$2,000-$5,000
World Class: Eskay Creek, Hemlo, Hermosa-Taylor, Oyu Tolgoi, LaRonde, McArthur
$5,000-$10,000
Giants: Escondida, Sullivan, Carlin Trend, Kidd Creek, Orapa, Kamoa-Kakula
above $10,000
Off the Scale District: Wits 1.0, Araxa, Sudbury Basin, Bayan Obo
The target outcome range required for the current implied project value to represent fair speculative value is based on the upper and lower certainty limits associated with the project stage. The color coding is based on the target outcome using the mid-point of the certainty range.
Net Interest: 100% WI Vested: Yes Uncapped NSR/GOR: 4.00%
Ownership Terms: January 2014 agreement for West Kirkland Mining to purchase up to 100% of the Hasbrouck and Three Hills properties, subject to Allied Nevada's option to decline the final payment and retain a 25% interest in the property, for a total purchase price of $30-million (U.S.). West Kirkland paid Allied Nevada a non-refundable $500,000 (U.S.) upon signing of the agreement and agreed to pay an additional $19.5-million (U.S.) upon closing, expected to be no later than April 24, 2014. The final $10-million (U.S.) is to be paid to Allied Nevada within 30 months after the closing date, subject to Allied Nevada's option to retain an interest in the property. In the event WKM does not meet its final $10-million (U.S.) commitment to Allied Nevada, or if Allied Nevada takes the option to decline the final payment and retain and interest in the property, the property will be placed into a joint venture with WKM holding a 75-per-cent interest and Allied Nevada retaining a 25-per-cent interest. On Aug 13, 2020 WVM acquired the remaining 25% for USD $10 million and 1,000,000 shares at CAD $1.30.