African Gold Group Inc. (OTCMKTS:AGGFF) Stock Continues to Move Higher: More To Come?

African Gold Group Inc. (OTCMKTS:AGGFF) stock continued to move higher on Wednesday after the company announced the news. The stock has surged 20% over the past week.

Market Action

In the previous trading session, AGGFF stock moved up 7.50% to $0.1183. A total of 14k shares traded for the session hands, well below its average volume of 23K shares. The stock opened at $0.1091 and moved in a range of $0.1087 – 0.1183.

Key Trigger

African Gold Group Announces Updated DFS With 66% Reserve Increase and 100koz per Year for First 10 Years

African Gold Group announced the results of the Definitive Feasibility Study (the “2021 DFS” or the “Study”) for the Kobada Gold Project (the “Project” or “Kobada”) in Southern Mali. The DFS was prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) and will be filed by the Company during October.

With our updated 2021 DFS we have shown that Kobada has the potential to produce over 1.2 mln oz of gold over a 16 year mine life while delivering solid economics with post-tax NPV5% of US$355 million and an IRR of 38%.

Kobada is a predominantly free-dig operation, requires limited blasting, and processing of ore will be through a very simple and proven gravity plus CIL plant with recoveries over 95% in both oxides and sulphides. The inclusion of sulphides in this updated DFS, which are free milling and easy to process, opens significant future opportunities within the sulphide resource as well as continuing growth possibilities in the oxides. We are confident in the capital estimates as compared to recent similar completed projects in the region, and these costs remain very competitive for a project of this size. The potential to produce significant free cash flows after tax and low capital expenditure highlights very attractive economics of our Kobada project.

Trader Notes:

AGGFF stock has done exceptionally well with a jump of 27% over the past month, but down 21% so far this year. On the technical basis, the stock is trading above its 50-day and 20-Day SMA stand at $0.11 and $0.11 respectively. Moreover, RSI at 54 signals that the stock is trading near the neutral zone.