Interview with Luke Alexander, President & CEO of Newcore Gold Ltd.

Our previous interview: https://www.cruxinvestor.com/posts/newcore-gold-ncau-clear-strategy-to-revenue-scaling-project-2944

Recording date: 12th December 2023

Newcore Gold represents an intriguing investment opportunity in the gold mining space. This relatively under-the-radar junior explorer and developer offers exposure to an advanced staged asset boasting robust economics, with a clear path towards production in the coming years.

The company’s flagship asset is the 100% owned Enchi gold project located in southwest Ghana, a premier mining jurisdiction in Africa. Enchi currently hosts an indicated gold resource of 743,500 ounces of gold grading 0.55 g/t, plus an additional 972,000 ounces at 0.65 g/t in the inferred category. The multi-million ounce gold system features strong expansion potential across the massive 216 square kilometer land package.

Importantly, Newcore has already demonstrated Enchi’s economic potential through a 2021 Preliminary Economic Assessment (PEA) outlining a starter open pit heap leach operation with average annual production in years two through to five of 104,171 ounces of gold, with 983,296 ounces of gold recovered over an 11-year mine life. At a gold price of $1,650/oz, the PEA generates an after-tax NPV (5% discount rate) of $333 million and an after-tax internal rate of return of 54% with a 2.3-year payback period on initial capex of $97 million. These robust numbers provide a glimpse of the value proposition Enchi can offer once in production.

Over the past year, Newcore has focused on derisking and advancing the gold project through additional metallurgical test work and completion of an updated NI 43-101 mineral resource estimate in March 2023. The new resource model resulted in a significant conversion from the inferred category into the higher confidence indicated category through infill drilling. The company is now targeting completion of an updated PEA study in 1H 2024 encompassing the larger measured and indicated resource base, as well as updated design parameters from the latest ongoing metallurgy and baseline environmental work.

Funded with approximately $5 million cash, Newcore has a 12 to 18-month runway to continue advancing Enchi without facing near-term financing risks. The intention is to systematically de-risk the gold project, completing key studies and economic analysis, to reach a construction decision in the coming 2-3 years.

Upside optionality also exists in Enchi’s considerable exploration potential, as the currently defined resource covers only a very small portion of the expansive concession package. Once the initial open pit heap leach operation is online churning out cash flow, the company can self-fund more aggressive exploration programs to target resource expansion and new discoveries across the wider district.

With gold exposure via an advanced staged project in a tier-one mining destination like Ghana, existing economic studies demonstrating potential for near-term low-cost production, and upcoming catalysts from de-risking activities, Newcore Gold offers investors speculative leverage to a rising gold market in the years ahead. The current sub-$20 million market capitalization leaves substantial upside as Enchi progresses to production. 

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View Newcore Gold's company profile: https://www.cruxinvestor.com/companies/newcore-gold

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