Nova Minerals Ltd (ASX:NVA, OTCQB:NVAAF) has the Estelle Gold Project in Alaska’s prolific Tintina Gold Belt that hosts >220 million ounces in mostly bulk tonnage but high-margin deposits.
According to Sydney-based securities advisor Martin Place Securities, NVA’s current market valuation of Nova’s recent phase 2 scoping study defined a very profitable US$654 million (m) pretax NPV5 project with low capital cost (US$385m) and intensity and a very attractive 53% IRR. Read: Nova Minerals delivers robust economic metrics with promising upside in Estelle Gold Project scoping study Martin Place notes that there is considerable value at NVA’s 9.9moz (million ounces) Estelle Gold Project which has already completed a phase two scoping study and is well advanced with its pre-feasibility study. However, NVA’s trade value is at a substantial discount to the US$654m NPV described in the scoping study and also against Tintina Gold Belt gold project developer peers with a discount that seems far too great. Stocks such as newly listed US GoldMining Inc with 9.4moz in similar rocks and adjacent to Estelle is priced at US$185m and with an enterprise value ~10x higher. Snowline Gold is also in the Tintina Belt in the Yukon with some very attractive gold drill results to date but yet to define a resource and has a market value of C$473m (US$350m) and an enterprise value 17x higher than NVA. Investment review - Martin Place Securities The Estelle Gold Project is one of the world's important undeveloped gold deposits. Its location in the Tintina Gold Belt is a very good gold endowment region and the Estelle Batholith has provided many prospects for gold mineralisation that may become economic. Exploration to date has already seen 10moz resources achieved in just over four years. The entire 35km of tenement length is prospective for IRGS deposits and other types. NVA has been very active in Alaska since 2019 and has drilled over 90,000 metres in mostly diamond drilling in around 250 holes with its maiden resource in that first year. Through this drilling, surface traverses, some IP surveys and rock chip sampling resources have been rapidly delineated at Korbel Main, RPM North and RPM South and Cathedral. The success in resource delineation and growth has allowed NVA to move quickly to consider the commencement of mining operations. The company is moving towards a full PFS due by the end of 2024. Alaska produces ~25 tonnes of gold pa with Fort Knox and Pogo providing around 9 tonnes each but Estelle’s year one could deliver 11.5 tonnes and make it Alaska's largest mine for the year. The economic and technical aspects of the Estelle gold project would make it a full member of the Tintina Gold Belt. The overall conclusion is that NVA is trading at a massive discount to most peer assets. NVA directors have made significant investments in the company and have participated in all capital raisings and have been buying on market in this weak price period as reported.