Stonecap Securities increased its price target for Orvana Minerals (TSE:ORV) Monday after visiting the miner's flagship EVBC mine in Spain.
The capital markets firm said the gold miner is "positioned to grow",
with the company recently releasing June production results from EVBC.
June production at the Spanish mine was 4,976 ounces of gold, 549,000
pounds of copper and 14,000 ounces of silver, at an estimated cash cost
of $600 per ounce of gold, net of by-product credits.
Total fiscal third quarter production from the mine was 14,000 ounces
of gold, 1,468,000 pounds of copper, and 40,000 ouncse of silver, a
"significant improvement" over the second quarter's output of 11,000
ounces of gold, 956,000 pounds of copper and 33,000 ounces of silver,
On Stonecap's site visit, analyst Christos Doulis observed that the
shaft has been completely reamed and is in the final stages of
commissioning, as the electrical systems are installed.
The installation of an underground crusher is also expected to increase the throughput capacity of the mine.
grades have "consistently improved" at EVBC, the equities research firm
said, and, at 3.3 grams per tonne gold, are now in line with
"We believe that EVBC has not only turned the corner, but that with
the shaft running in early August we should see production improve by
~20% and costs decrease," Doulis wrote in his research note.
"Operations at Orvana’s flagship EVBC continue to improve ahead of
the shaft coming on-line and Orvana has had a second month with
production of ~5koz Au, at an impressive preliminary cash cost of
Stonecap maintained its "outperform" rating on Orvana, and increased
the price target to $2.10 from $2.00 previously, compared to its current
trading price of 85 cents.
Orvana also owns and runs the Don Mario mine in Bolivia and recently
completed a feasibility study and snagged a mine permit from the
Michigan Department of Environmental Quality for its Copperwood copper
project in Michigan, U.S.