Diamond drilling at NE Bankan continues to expand the high-grade core. We think PDI has added around 1Mozs to NE Bankan beneath the pit shell constrained 3.65Moz maiden Resource estimate. The grade and tenor of results would likely continue to pull down a pit-shell, but more efficient extraction through combined open-pit and underground mining is likely the play here. We now model a combined open-pit and underground mining scenario as a basis for valuation. Environmental studies have commenced in-country, and we have no further clarity on when the government will be returned to civilian rule. Keeping those risks at the front of our mind we still maintain that NE Bankan plus the regional exploration potential is a highly valuable project that will likely continue to grow. We maintain our Speculative Buy recommendation with an improved valuation of 36cps, prior 27cps.
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