Just after the close yesterday, Newmont Mining (NYSE: NEM) guided up 2009 production and guided 2009 cash costs lower. NEM also announced that it would be purchasing the remaining interest in its majority owned Boddington Mine from Anglogold Ashanti (NYSE: AU) (which equates to 6.6 mln reserve ounces). That's an increase of 8 percent in NEM's Proven & Probable (P&P) reserves at a price tag of $1.2 bln, which will be raised via an equity offering of 19 mln shares.

Based on NEM's 441 mln shares outstanding, we're looking at dilution of just over 4 percent. Thus, in theory, the deal is not even dilutive, given the 8 percent increase in P&P reserves that the company is acquiring with only a 4 percent dilution in equity. Based on what I have seen so far, this looks like a spectacular deal for NEM.

Continue reading Newmont strikes a deal

Newmont strikes a deal originally appeared on BloggingStocks on Wed, 28 Jan 2009 12:19:00 EST. Please see our terms for use of feeds.

This post was written by Minyanville contributor Lance Lewis.

Banro (NYSE: BAA) jumped 13% yesterday after the company announced that it had finally completed its bankable feasibility study on its Twangiza project and proved up nearly 4 mln ounces of its 10 mln ounce resource. Thus, we can now calculate an NAV for BAA.

BAA has no debt. So, assuming $1,000 gold, 3.67 mln ounces of Proven & Probable reserves, an average cash cost of $429 per ounce over the life of the mine (which is based on the feasibility study), and the estimated $410 mln required for cap ex, we get an NAV of almost $15 a share (which gives zero value to the company's current cash balance of around $20 mln and its remaining 5.6 mln ounce resource at Twangiza, not to mention the resource estimates at its other properties).

Continue reading Banro (BAA): A golden stock

Banro (BAA): A golden stock originally appeared on BloggingStocks on Tue, 27 Jan 2009 13:15:00 EST. Please see our terms for use of feeds.