Integra Gold's Lamaque looking better than ever after updated PEA announcement

March 10, 2017 02:01 PM


In a Feb. 27 press release, Integra Gold Corp.'s (ICG:TSX.V; ICGQF:OTCQX) announced an updated PEA for its 100% owned Lamaque South Gold Project located in Quebec. A few positives from the PEA included an increase in mine life from 4.5 years to 10.5 years, average gold production projected at 123,000 ounces annually and a reduction in total mining costs to C$86/tonne.

Integra President and CEO Stephen de Jong added that "this study further demonstrates Lamaque's extremely rare positioning as a project in a safe jurisdiction with high grades and high margins, with the potential to be up and running in less than two years."

Supporting de Jong's optimistic statements was Tara Hassan, an analyst for Raymond James. In the Raymond James Mar. 2 report, Hassan stated that "the most significant positive changes over the previous study were increases to throughput, annual production, and mineable resources." Hassan highlighted that "Lamaque ranks well against Canadian producers... .and now, with the updated PEA, this is even truer. Comparing producing projects with an average resource grade of greater than 2 g/t Au, Lamaque's new production profile moves it up one

spot to rank 9th, and its top rank on costs is maintained. Integra's current valuation (0.66x NAV and US$55/oz) also ranks it favorably against a group of developer peers (0.68x NAV and US$61/oz)."

George Topping, an analyst with iA Securities, pointed out in a Mar. 2 report that "this PEA is a good step on the way to a full Feasibility Study. We expect the total mineable resource to reach 3 Moz in 2018. We have made adjustments to our model and maintain our Buy Rating."

Macquarie Research Analyst Michael Gray wrote in a Feb. 28 report that "ICG is one of the most active junior exploration companies globally and also in the developer stage with a robust +10yr mine life, Feb/17 UPEA, and [an] underground bulk sample program underway in 3Q17 at its flagship Lamaque."

Gray also pointed out that "in September 2014, ICG acquired the permitted Sigma-Lamaque milling facility, which we think was a 'game-changing' transaction, reducing initial capital costs, and potentially shortening the timeline to production . . .in the same transaction ICG also acquired the historic Sigma and Lamaque mines." The Sigma and Lamaque mines were later used for the Gold Rush Challenge event at the 2016 annual Prospectors and Developers Association of Canada (PDAC) convention. This year at PDAC Integra Gold teamed up with Goldcorp Inc. (G:TSX; GG:NYSE) and four top technology companies—Microsoft, IBM, Accenture and Cisco—on a mining innovations event called #DisruptMining. Michael Gray believes these two events "reflects management's bold and innovative approach to the discovery & development process and also marketing."

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