A property stock finding lots of value in central Europe
Ian Watson, chairman of Galahad Gold, the mining finance concern backed by celebrated wheeler-dealer Jim Slater and his son Mark, argues Galahad is an excellent 'leveraged' way to back rising prices of gold, platinum group metals and molybdenum. Galahad, formed by the merger of Galahad Capital with gold prospector Shambalha, claims access to 46m oz of gold 'in the ground' through its ownership of the Skaergaard project in Greenland, with an estimated 10.9m oz of gold, 35m oz of palladium and 3m oz of platinum, and its 34.8% stake in Alaska's Pebble deposit, with a possible 26.5m oz of gold and a total potential gold, copper, molybdenum, silver and porphyry resource equivalent to 76m oz of gold. These deposits are low-grade and in tough terrain and analysts believe Pebble could cost £600m to take to production, but Watson says they are 'in the money' with gold at $402 an ounce, platinum at $885 and palladium at $214. He says Galahad is in no hurry to mine its properties but would like to see its minerals grow in value in the ground. Concern over eventual extraction costs, coupled with second-quarter metal price nerves, has helped knock the shares from a 12-month high of 26.7p to 11.25p. If you think US deficits and other factors will make for strong gold and platinum group metals, the shares are worth a strong-nerved punt.
Market cap: £65.5m
PE Forecast: n/a
Share price: 11.25p
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