Marengo Mining is an Australian mineral exploration-development company developing a copper-gold project in PNG. This company has several advantages and disadvantages:
Advantages:
1. It is a very large project so it is an attractive leveraged investment into metal exposure.
2. This project is going to be a long life mine
3. The possibility of higher grade (gold?) zones which might allow higher earnings in the early years.
Disadvantages:
1. The project is a copper-molybdenum project. The gold content is nominal only unfortunately.
2. The project's commodity output will be hit by the rising interest rate environment in coming years - both in terms of its debt exposure and the impact on commodity prices. So its a pity there is little gold content.
3. The mine will not be producing until 2013, so looking at a long development lead time. This is what you expect from such a large project.
This stock will make good buying in 2012 I suggest, though of course one will need to look at the commodity prices at the time and interest rates to see if they are viable. In the long term it will be an attractive project. Certainly its a stock to watch, but I'd be looking for more gold, precious metal content. More info on this company at Marengo or see this presentation. Latest share price at Google Finance.
------------------------------------------
Andrew Sheldon www.sheldonthinks.com
Advantages:
1. It is a very large project so it is an attractive leveraged investment into metal exposure.
2. This project is going to be a long life mine
3. The possibility of higher grade (gold?) zones which might allow higher earnings in the early years.
Disadvantages:
1. The project is a copper-molybdenum project. The gold content is nominal only unfortunately.
2. The project's commodity output will be hit by the rising interest rate environment in coming years - both in terms of its debt exposure and the impact on commodity prices. So its a pity there is little gold content.
3. The mine will not be producing until 2013, so looking at a long development lead time. This is what you expect from such a large project.
This stock will make good buying in 2012 I suggest, though of course one will need to look at the commodity prices at the time and interest rates to see if they are viable. In the long term it will be an attractive project. Certainly its a stock to watch, but I'd be looking for more gold, precious metal content. More info on this company at Marengo or see this presentation. Latest share price at Google Finance.
------------------------------------------
Andrew Sheldon www.sheldonthinks.com
