January 17, 2011
Sandstorm Resources Acquires Gold Stream From Metanor Resources' Bachelor Lake Gold Project
•Sandstorm has entered into a gold purchase agreement with Metanor Resources on its Bachelor Lake Gold Project in Quebec, Canada
•Sandstorm to purchase 20% of the life of mine gold production
•Sandstorm will make staged upfront payments totaling US$20 million
•Sandstorm will pay US$500 per ounce as an ongoing payment
•Metanor recently released the results of a pre-feasibility study on the Bachelor Lake Gold Project which is expected to begin production in 2012
Is that all you've got, calling me dude to make your point. Simply answer a questions or show some facts will help you much better to get discussions started my friend. Of course the Metanor payment is in tranches, I can read too. Those tranches are planned in the next six months. Furthermore Sandstorm has to pay the last tranche of Rambler as well. You can also go to the website of Brigus and you will see that they need lots of money to further explore the Black Fox property. Money they simply can not use to pay back on Sandstorm. Besides that, the option is till January 2013, like I mentioned before.
We simply can not expect new good goldstream deals without having Sandstorm to issue new shares. We thus need something else to get the share price boosted.
Dude, the $20M payment to Metanor is in tranches. The last tranche doesn't get paid for a long time from now. Brigus is going to make a huge lump sum payment later this year to buy back 6% of the Black Fox LOM.
Sandstorm still has cash, and will be generating more shortly.
I do not know where you got your info from but here is a brief summary:
Cash per September 30, 2010 30 M
Public Offering + 57 M
Paid to Rambler -7 M
Pending to pay to Rambler -6 M
Paid to Brigus - 56 M
Paid/to be paid to Metanor -20 M
Totals - 2 M
Secondly the option with Brigus that you are referring to, expires in January 2013, not this year...
The ability to buy gold at $ 500 and sell for spot is great, but shouldn't you include the upfront payment of 20 Million ? The mine has reserves of 200 KOz. Expected production is 60 Koz a year, giving it a mine life of 3.5 years, which is confirmed on Sandstrom's site as well as on Metanor's site. With what intention do you consequently mis-inform other readers on this board.
Compare this deal to the one with Brigus and Luna, considering that the option is exercised:
Brigus 20 M (56 M -/- 36 M)
Luna 20 M
Metanor 20 M
Brigus 6% of 80 Koz = 5 Koz a year at $ 500
Luna 17% of 60 Koz = 10 Koz a year at $ 400
Metanor 20% of 60 Koz = 12 Koz a year at $ 500
Metanor 3.5 years
If you don't see the differences between the last deal and the others, I rest my case.
You are 100% right mentioning companies like SLW and RGLD have premiums, but please do not under estimate the huge number of shares Sandstorm has already outstanding. We are talking about 398 M shares and 120 M more when warrants are exercised. Within two, three years they expect 50 M cashflow from operations. That's less then a dime a share. Do you now understand why I am concerned that further growth can only be realized by more share issuance.
Like I mentioned, I own the shares because I like the Company, but it's not that great neither. Don't try to convince readers on this board otherwise. Of course everybody has to do their own research...
I think you are incorrect about them being out of cash. They still have some cash and cash flow is coming in and they will odds on be receiving almost $40M from brigus later this yr when they exercise the right to repurchase half of the gold stream from sandstorm. So they will have a large wad of cash again in 2011. Patience.
As for the Metanor deal not being "that good". Nonsense. Would you like the ability to buy gold for $500 oz and sell for spot?! I do.
We are talking over 10k ozs a yr for 5 years minimum. The other poster seems to rule out any possibility of Bachelor Lake finding any new ozs. I bet they do and they extend the mine life substantially in coming years and sandstorm gets to participate in 20% of that.
Well done sandstorm. They are really poised for growth into next year and 2013. Strong buy IMHO at any sub $1 price. 50-60 c would be a complete giveaway.
People need to understand that peers like SLW RGLD and Franco trade at premium multiples to other gold stocks and this will ALSO in time...
Too bad that you both have the impression that I dislike this stock. That is absolutely not the case. I only mentioned that I do not expect too much fireworks on short term due to the fact that there is no money for new deals unless they issue new shares. In fact I own Sandstorm as well as I have its warrants in possession. I am in for the long term though.
This deal is less interesting then the others agreed upon in 2010. Production is expected no sooner then 2012, while furthermore the mine life is 3.5 years only...thirdly is means that all funds are used now and future gold stream negociations depend on cash flows to be generated from current streaming deals and/or additional shares issuance.