RANDGOLD IS LIVING PROOF OF THE OLD ADAGE “ALL THAT GLITTERS IS GOLD”. INVESTORS THAT BOUGHT THE STOCK BACK IN 2006 AT AROUND 1,200P WILL BE OVER-THE-MOON; YESTERDAY IT CLOSED AT 4,480P.
ITS FORTHCOMING PROJECTS WOULD SUGGEST THAT RANDGOLD CAN STILL CREATE SHAREHOLDER VALUE. ONE-TIME FLAGSHIP MINE MORILA MIGHT BE ON ITS LAST LEGS NOW THAT IT HAS MOVED TO A STOCKPILE TREATMENT STAGE, BUT THE LOULO MINE IN MALI LOOKS SET TO BE A BIG EARNER, WITH PRODUCTION EXPECTED TO RISE TO 410,000 OUNCES IN 2010 – A 17 PER CENT INCREASE.
THE ONE TO WATCH IS THE CONGOLESE KIBALI MINE, WHERE IT SHARES OWNERSHIP WITH ANGLOGOLD ASHANTI. DEVELOPING THIS MINE – WHICH CONTAINS UP TO 19.76M OUNCES ACCORDING TO EARLY ESTIMATES – WILL COST SOME $800M, DEPLETING RANDGOLD’S $530M CASH RESERVES. AND THE DEMOCRATIC REPUBLIC OF CONGO GOVERNMENT HOLDS A 10 PER CENT STAKE, MEANING PROGRESS COULD BE SLOW
STILL, WITH A RISING GOLD PRICE, A 10 CENTS-A-SHARE DIVIDEND, A PROVEN TRACK RECORD AND EXCITING UNTAPPED ASSETS, SHAREHOLDERS WOULD BE WELL-ADVISED TO STICK AROUND.
