Tag: Novo Resources Corp.

Impact: Mildly Positive
Novo Resources announced coarse gold recovery results from a portion of the ongoing trenching and bulk sampling program at its Egina Gold Project in Western Australia (Figure 1). Work at Egina continues to deliver good grades (>1 g/m³) and further trenching demonstrating scale, could prove to be a significant alluvial gold deposit, considering the expansive area over which these gravels extend. While the market typically ascribes little value for this type of asset, we believe that as Novo continues to produce gold from its trenching work and subsequent larger scale sampling, we expect that to change.

Impact: Mildly Positive

Novo has announced results from four bulk samples on its Egina project with ore grade results from three of four samples. With a recently announced US$30M farm-in with Sumitomo Corp, Novo is well positioned with the technical knowledge and financial support to develop Egina. We expect the market could price in the potential at Egina with successful bulk sampling.

Impact: Mildly Positive

Novo has announced results from its first trench at the Egina project which turned out numerous large gold nuggets. With a recently announced US$30M farm-in with Sumitomo Corp, Novo is well positioned with the technical knowledge and financial support to develop Egina in to an economic deposit. We expect the market could price in the potential at Egina with successful bulk sampling.

Impact: Mildly Positive

Novo has announced the completion of a mineralization report which is a key catalyst to move the Karratha Gold project towards pseudo production through a large-scale (~100k tonne) bulk sample. In 2019 Novo is focused on advancing multiple projects, all of which we expect to provide positive catalysts for Novo and the other Pilbara players.

Impact: Mildly Positive

Novo has announced the receipt of mining leases and approvals for its Beatons Creek project which significantly de-risk the project. The Company is now evaluating development options. We continue to believe that as the company advances multiple projects in 2019, Beatons Creek, Karratha and Egina, it should re-rate towards our fair value range of C$2.70-5.10/sh.

Impact: Mildly Positive

Novo has announced an increased resource for its Beatons Creek project in Western Australia which we believe is of sufficient scale to stand alone. We now believe Beatons Creek is worth C$1.40-1.70/sh (was C$1.10-1.40/sh). With an increased resource at Beatons Creek, which underpins our current valuation, the market has yet to fully price in the upside of Karratha, Egina and wider Pilbara projects.