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Stonegate Capital Partners Updates Coverage On Velocity Minerals Ltd. (TSXV:VLC)

·3 min read

DALLAS, TX / ACCESSWIRE / December 17, 2020 / Velocity Minerals Ltd. (TSXV:VLC): The full report can be accessed by clicking on the following link:http://stonegateinc.com/reports/VLC.V Q320.pdf.

Company Description
Velocity Minerals Ltd. (TSXV:VLC) is a precious metals exploration and development company with projects in Bulgaria. The Company is currently exploring multiple projects through its "Hub & Spoke" development strategy, which envision open pit mining of satellite deposits and processing through a central plant. The Company's most advanced project is the Rozino Gold Project located approximately 350KM Southeast of the Capital, Sofia. The Company's portfolio of projects also consists of options to earn interests in the Obichnik, Makedontsi, and Iglika Gold and Copper-Gold Projects. Velocity Minerals was incorporated in 2000 and is headquartered in Vancouver, Canada. The current management team took over the Company in a reverse takeover following the acquisition of the Rozino Project in July 2017.


  • Velocity Minerals is a gold exploration and developments company focused on its exploration assets in Bulgaria. The Company has multiple advanced gold projects with near surface deposits within a gold belt that has been under-explored.

  • The Company will be implementing its "Hub & Spoke" development strategy to increase all of its project's economic prospects. Its strategy consists of using open pit mining at each of its "satellite" locations, producing concentrate and trucking the concentrate to a central processing plant that is already in place. The "Hub & Spoke" model has been successfully implemented by St. Barbara in Canada.

  • The Rozino Gold Project is Velocity's flagship project where a Prefeasibility Study has shown an initial probable mineral reserve estimate of 465,000 oz of gold. The Prefeasibility Study also resulted in an after-tax NPV of US$123M and an IRR of 27.4%, which assumed US$1,500 gold prices.

  • The Central processing plant Velocity intends to use has been operating since 2011 and is certified under the International Cyanide Management Code (ICMI). The processing plant has been operated by its Bulgarian partner Gorubso-Kardzhali AD and is the only Company in Bulgaria to secure a CIL operating permit.

  • All of Velocity's projects have expected positive common features including low all-in-sustaining-costs, low initial capital expenditures, low strip to deposit ratio, and proven resource expansion at the existing deposits.

  • The Company raised approximately $8.9M in a strategic investment and private placement in November 2020. Importantly, $6.7M of capital was raised from a new corporate shareholder, Dundee Precious Metals (TSX: DPM). DPM's strategic investment gave it a 9.99% ownership position. Additionally, Artemis Gold (TSXV: ARTG) invested $2M and maintained its ownership position at 22%. Lastly, $0.3M was raised from its JV partner, Gorubus-Kardzhali. The Company is well capitalized to complete its exploration programs in the Rozino area and in other projects in Bulgaria during 2021.

  • The Company's management team and board include mining industry professionals with experience in Europe, Africa, Australia, and the Americas as employees of major mining companies as well as founders and senior executives of public companies.

  • The country of Bulgaria is politically stable and is served by modern European infrastructure of paved roads. Mining royalties are comparable to countries like Canada, Peru and Chile and the country also boasts a low corporate tax rate of 10%.

  • Based on our DCF of VLC, we arrive at a valuation range of CAD$0.41 - $0.69, with a midpoint of CAD$0.55; see page 7 for further details.

About Stonegate Capital Partners
Stonegate Capital Partners is a Dallas-based corporate advisory firm dedicated to serving the specialized needs of small-cap public companies. Since our inception, our mission has been to find innovative, undervalued public companies for our network of leading institutional investors who seek high-quality investment opportunities.

Stonegate Capital Partners
(214) 987-4121

SOURCE: Stonegate Capital Partners

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