On Thursday Edgewater Exploration Ltd. (CVE:EDW) (PINK:EDWZF) revealed results of the preliminary economic assessment on their gold project in Spain and made sure the announcement would reach as many investors as possible.
In result, Wallstreetgrand issued yet another e-mail prompting EDW as a potential buy. The promoter does this under an investors relations contract with Edgewater and was compensated with a total of $40 thousand for their services.
The newsletter was clearly sent out so that the latest news would reach a larger audience. The company issued a press release on November 17 stating they have received a preliminary economic assessment of the Corcoesto gold project.
Apparently, the project could be producing $60 million worth of gold per year with a net present value of the mine at $206 million at 5% discount rate. The mine has a 9.9 year life when open pit and underground operations are included in calculations. IRR for this project would be 24% with payback of capital in 3.4 years calculated at conservative gold price of $1,300 per ounce.
A definitive feasibility study is planned for 2012. Beforehand with that the company will be drilling 20 thousand meters to convert the inferred resources into measured and indicated. The project will also require initial capital expenditure of $135 million.
Edgewater’s current liquid capital position of $17.5 million will only be sufficient for the mentioned studies and it is very likely that the company will raise the remainder by issuing capital stock as it’s been a common practice to date.
