Dacian: Emerging as a standout at a time of M&A

In an environment where corporate interest in quality gold assets is highly competitive, Dacian Gold's un-developed Mt Morgans gold project is emerging as a standout in the Australian gold space. The Westralia underground (9.2Mt at 5.1g/t for 1.5Moz) and Jupiter open pits (24Mt at 1.3g/t for 1Moz) comprise the bulk of the project's resource base and, in our view, are of adequate size and quality to support a development scenario. On the back of a diligent exploration program, project resources have increased to +3Moz, which provides the critical mass to support the development of a standalone gold operation. We have assumed development funding of $150m (+$30m for declines) which compares favourably to comparable ASX-listed pre-production peers. Australian dollar gold, which is now within 2.3% of a three-year high, and within 12.5% of an all-time high, provides a good tailwind. The investment proposition is further strengthened by a quality management team with a proven development, operational and corporate track record. We initiate with a Speculative Buy recommendation, $0.95/sh price target. Click here to see our initiation report: (VIEW LINK)


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