Loncor Gold
Primary ticker: TSX:LN, OTCQX:LONCF, FSE:LO51
Stage of development: Exploration, Development
Primary minerals: Gold
Project to promote: ADUMBI
Project location: DRC
Website: www.loncor.com
Corporate presentation: Click here
Loncor has quietly grown into one of the major new gold discoveries in Africa, 220kms from Africa’s largest gold mine. Loncor controls 4m ozs of resources at over 2.2g/t, with further potential below and along a 16km structure. It already has a mining permit and detailed PEA with an estimated US$2BN NPV@5% after tax (using US$2650/oz gold). Through ongoing deeper drilling, Loncor aims for 5M oz of resources in 2025. The DRC, on numerous measures, is showing positive signs of development versus many comparable African mining jurisdictions. With a market cap of around US$50M, Loncor’s quality, future potential and proximity to Africa’s largest gold mine have yet to be recognized as it severely lags its peers’ valuation – the Enterprise value per ounce resource is many multiples lower than comparable companies with lower grade projects.
Major shareholders:
Arnold Kondrat – 20%
Resolute Mining Ltd – 20%
Newmont Mining Limited 5%
Management Ownership – 22%
Financials
Management Profile
John Barker – CEO
Mr Barker joined Loncor in March 2020. He started out working on the RSA gold mines, followed by 15 years’ experience as a leading mining analyst, including with RBC DS heading up their Global Gold Mining initiative – mainly focussing on African mining equities. Subsequently, he was Vice President Corporate Development for TSX-listed SouthernEra Resources, which was taken over by Lonmin, and in a similar role at Guinor he was a key player in the Guinor Gold sale to Crew Gold. He also worked for Robert Friedland looking to rationalize his African assets. More recently he has been involved in various copper, diamond and platinum initiatives in Southern Africa. During his career he has been involved in numerous asset sales, and equity issues of over US$600m covering Canada, Australia, Europe and RSA.
What is your rationale for taking part in 121 Mining Investment?
Tell our story to potential investors in our equity.
What recent news would you like to highlight to investors attending?
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What are your key goals for the next 3, 6 and 12 months?
3 Months:
Ongoing drilling program below the 3.66M oz resource at Adumbi plus marketing of the Loncor story
6 Months:
Drilling and beginning of resource reassessment at Adumbi, coupled to ongoing marketing
12 Months:
Targeting 5M ozs of gold resources at Adumbi, an improved awareness of our story and a reduced discount to our peers.
What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?
Our biggest issue is to get investors to see the opportunity Loncor offers in the DRC, given our nearest mine/neighbour is the highly successful and low cost Barrick managed Kibali mine – Africa’s largest gold producer. The Loncor team has had experience operating in the DRC for at least, if not longer, than the successful Kibali team.
What do you think makes your company such a compelling investment?
The story is relatively unknown. In a short time, the Adumbi deposit has exhibited a rapid rise in resources at high grades. Peer group and PEA valuations show significant value discrepancies given the size and grade on show.
What are the top 3 key investor takeaways?
Drilling ongoing below Adumbi; Aim to push 5M oz resource in 2025t valuation versus peer group; Our share price vs the NPV (in our PEA) and Enterprise valuation is significantly lagging.