By Doc Holiday
Alecto Minerals are a gold exploration and development company with assets in south central & western regions of Africa, the company has hardly been a story of wealth health and prosperity however I now believe ALO has the ability to claw back losses and start a more upbeat run in the markets. Aletco Minerals has of late assigned a more material focus to business by acquiring a gold asset in Zambia which (from recent scoping studies) present economical mining at current gold prices $1100. The actual forecast of cash costs are approx. $695 with a suggested 760,000oz reported by Coffey Mining Pty Ltd.
We can identify a new theme from the company as recent announcements contain a more upbeat message, recently the company commented:
”we have developed a clear roadmap of how we can rapidly move the Matala Project into production. Utilizing the skills of our partners and leveraging the in-house experience of Alecto’s Board and personnel, we have a clear opportunity to deliver ahead of our initial expectations.”
Naturally showing caution in an incredibly tough market isn’t a bad thing, however the caveat to that is when there’s blood on the streets it presents a buying opportunity, Alecto looks to have seen the worse as the shares trade down at 0.06p after securing cash in a recent placing allowing the company to make its most recent acquisition. Gold has for many years acted as a hedge against a week currency environment, particularly the U.S Dollar. Over the recent year or two we have seen a distinct lack of correlation, however global uncertainty coupled to the circumspect manner of the market participants has led to an unfamiliar trading pattern. I expect as the stress test on commodities and global uncertainty are tested we are likely to see a return of USD/Gold pair movements etc.
Alecto has enough news flow to stimulate the market, yet the material nature of the company’s developments and its timing is key, if they progress and develop their assets in an efficient and timely manner you will see a significant turnaround from the mid-price of 0.0575p if not then expect a slow uncomfortable ride through 2016. I’d like to draw attention to the mining report, cash costs (Uplift costs) and general theme of wording.
The shares traded quiet comfortably between 0.09 – 0.14p for the best part of a year, this buckled after the most recent funding call however a break of 0.088p could be the catalyst to drive back towards 0.14p.
Keep your peckers up
Doc
