Timberline Resources (TLR) Aquisition of Staccato Gold (CAT.V) Presentation and Conference Call
Timberline Resources held a conference call this past week as a follow up to their announcement that they would be acquiring Staccato Gold. The acquisition brings in a second late stage project into Timberline. Timberline’s core asset, Butte Highlands Gold Project of 750,000 ounces of gold (expandable), will be in production Q1/Q2 2011 at a rate of 70,000 ounces per year, around a $450 cash cost. Staccator’s core asset, the Lookout Mountain Project of ~600,000 ounces of gold (expandable), is a project that needs a little more drilling to expand the resource but could realistically be in production in 2.5-3 years. The capex for the Lookout Mountain project would be similar to Butte Highlands (ie $15-20 million), would be a heap leach operation, probably be a 30,000-50,000 ounce/year production potential at $400 cash cost. The combination of the two projects has realistic potential to make timberline a 100,000+ ounce gold producer over the next 3 years.
Listen to the Conference Call Here
Disclosure: LONG TLR
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Ian, with the new acquisition, how does this change your overall view of the company and their 2-3 year share price assuming gold stays at least above 1000? thx.
Tyson:
I think the acquisition is a good one but it will effect the short term target price because of the dilution. Where in 12 months I was expecting $2.50-3.00 PPS, now I would expect $2.00. Long term ie 24 months, it really depends on their updating shareholders to the game plan to bring this new project into production.
IC