Liberia's Dugbe Gold Project: A Strategic Asset Driving Growth and Sustainability

1. Pasofino Gold Ltd. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Pasofino Gold Ltd. 
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* Disclosure for the quote from the Clive Maund article published on December 31, 2024

1. For the quoted article (published on December 31, 2024), the Company has paid Street Smart, an affiliate of Streetwise Reports,  US$3,000.
2. Author Certification and Compensation: [Clive Maund of clivemaund.com] is being compensated as an independent contractor by Street Smart, an affiliate of Streetwise Reports, for writing the article quoted. Maund received his UK Technical Analysts’ Diploma in 1989.  The recommendations and opinions expressed in the article accurately reflect the personal, independent, and objective views of the author regarding any and all of the designated securities discussed. No part of the compensation received by the author was, is, or will be directly or indirectly related to the specific recommendations or views expressed

Clivemaund.com Disclosures

The quoted article represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be  only be construed as a recommendation or solicitation to buy and sell securities.

Pasofino Gold Ltd. (VEIN:TSX.V) is a Canadian-based mineral exploration company listed on the TSX Venture Exchange and Frankfurt Stock Exchange. The company's primary focus is the Dugbe Gold Project, located in Liberia, West Africa. Through its wholly-owned subsidiary, ARX Resources Limited, Pasofino holds 100% ownership of the Dugbe Gold Project prior to the 10% carried interest held by the Government of Liberia.

The Dugbe Gold Project is situated within the Birimian gold belt, a highly productive geological region. The project contains a measured and indicated resource of 3.3 million ounces of gold, averaging 1.37 grams per tonne of gold (g/t Au), and additional inferred resources that offer potential for further expansion. The feasibility study, completed in June 2022 by DRA Projects and SRK UK Limited, demonstrated robust economic metrics, including a pre-tax NPV5% of US$690 million at a base gold price of US$1,700/oz, increasing to US$1.76 billion at US$2,400/oz.

Liberia's mining-friendly environment further supports the project's development. The Dugbe Gold Project benefits from proximity to Greenville Port, upgraded access infrastructure, and a Mineral Development Agreement that provides a 25-year mining right with favorable tax and duty terms. The feasibility study also outlined plans for a conventional gravity-CIL processing plant with a capacity of 5 million tonnes per annum, targeting gold recoveries of 80-85% over a 14-year mine life.

Pasofino emphasizes responsible mining practices, adhering to international standards such as the Responsible Gold Mining Principles and the IFC Performance Standards. Community engagement and environmental sustainability are central to its operations, including plans for biodiversity offsets and the installation of a 16 MWp solar power system to reduce emissions.

Catalysts for Pasofino's Growth and Value Creation

CEO Brett Richards has highlighted that the company's share price is undervalued relative to similar development-stage gold projects. While Pasofino's shares trade between US$0.57 and US$0.59, the company has received non-binding offers exceeding US$75 million, or approximately US$0.90 per share. According to the company, recent developments suggest strong interest from multiple counterparties conducting due diligence and site visits, positioning the Dugbe Gold Project as a highly attractive acquisition target.

According to Technical Analyst Clive Maund Pasofino's shares are "trading at approximately a 40% discount to what a transaction could deliver soon in terms of value to shareholders," with potential offers reaching CA$100 million (approximately US$75 million).

Also, West Africa's gold sector has experienced heightened M&A activity, particularly from Chinese entities that favor large-scale projects like Dugbe.

The company recently declined an exclusive offer to pursue a more competitive binding proposal, underscoring the high level of interest in the project.

Exploration potential remains a key growth driver for the company.

The Dugbe deposits are open for expansion, with promising drill targets identified at Bukon Jedeh, Tuzon-Sackor Trend, and Nemo Creek South. Pasofino aims to convert inferred resources into reserves and explore high-grade zones that could enhance the overall resource base.

Operational optimization also presents opportunities to increase project value. Ongoing efforts to improve metallurgical recovery, reduce costs, and explore alternative energy solutions such as hydropower could significantly enhance the feasibility study's economic metrics. These initiatives align with Pasofino's broader strategy to unlock the project's full potential while maintaining high ESG standards.

Shares Are at a 40% Discount

Positive third-party evaluations have highlighted Pasofino Gold Ltd. as a company poised for significant growth and value creation, particularly due to its strategic Dugbe Gold Project in Liberia. *According to Technical Analyst Clive Maund on December 31, Pasofino's shares are "trading at approximately a 40% discount to what a transaction could deliver soon in terms of value to shareholders," with potential offers reaching CA$100 million (approximately US$75 million). Maund emphasized that Pasofino represents an "Immediate Strong Buy," citing its undervaluation and robust development prospects.

Maund also elaborated on the Dugbe Gold Project's strategic importance, situated in the prolific Birimian Gold Belt, an area known for attracting significant international interest. He noted that the company has already received substantial interest from external parties conducting due diligence and site visits. This interest underscores the project's potential for further discoveries and expansion, with only five of the fifteen identified targets drilled to date.

The company's economics further bolster its appeal. Maund highlighted the Dugbe Project's feasibility study, which projected impressive returns even at gold prices of US$1,700 per ounce. With current gold prices exceeding US$2,600, the project's projected payback period could decrease from 3.3 years to as little as 1.7 years. Operating expenses of US$1,005 per ounce and substantial gross margins of up to US$1,600 per ounce make the project highly competitive within the sector.

Additionally, Maund pointed out that the project's permitting process is well advanced, with a 25-year mining right secured under the approved Mineral Development Agreement. Infrastructure advantages, including proximity to the Greenville Port and the use of LNG and solar power, further enhance the project's feasibility.

Year-End Sentiment Sets Stage for Gold's Next Rally

On December 5, Gary Wagner of Kitco reported that gold prices settled at US$2,653.90, reflecting a moderate decline of 0.76%. The losses were mitigated by a weakening U.S. dollar, which decreased by 0.58% on the index. Wagner highlighted the Federal Reserve's potential rate cut as a key factor influencing the gold market. This policy shift, anticipated at the upcoming Federal Open Market Committee (FOMC) meeting, was expected to further support gold prices as the central bank seeks to balance inflation control with economic growth.

The following day, December 6, 2024, Jordan Roy-Byrne in The Daily Gold emphasized gold's performance relative to traditional investment portfolios, such as the 60/40 stock-bond mix. Despite gold's breakout from a 13-year cup-and-handle pattern earlier in the year, Roy-Byrne noted that the metal had yet to outperform broader equity markets. He observed that significant inflows of capital into gold and silver could occur when gold decisively outpaces these conventional portfolios, potentially signaling the beginning of a secular bull market.

On the same day, Adam Hamilton of Ahead of the Herd described the recent correction in gold prices as part of a broader "monster upleg." Over the 12.9 months ending in October 2024, gold surged 53.1%, peaking at US$2,801.80. Hamilton characterized the subsequent 8.0% pullback as a healthy rebalancing within the context of a larger bull market. He attributed the rally's strength to robust global demand, particularly from Chinese and Indian consumers and central banks, rather than from U.S. investors. Hamilton highlighted that the reduced reliance on U.S. markets has made gold more resilient in the face of global economic shifts.

On December 7, Shad Marquitz of Excelsior Prosperity referred to the gold sector as being in "the eye of the storm." He described the recent consolidation following the surge to US$2,801.80 as a natural pause in an overall bullish trend. Marquitz noted that central bank purchases, safe-haven demand from Eastern markets, and increased investment momentum from the West contributed to gold's rally. He further pointed to technical indicators, such as support levels at the 50-day and 200-day exponential moving averages, as key metrics for maintaining the sector's bullish posture.

In a report dated December 13, Reuters reported that gold prices were on track for a weekly gain, despite some profit-taking after hitting a five-week high. Ole Hansen of Saxo Bank remarked that the market had entered a period of low conviction and cautious positioning ahead of the year-end. Hansen expected gold prices to consolidate in the short term before resuming an upward trajectory in 2025, potentially reaching $3,000 per ounce. He attributed this outlook to anticipated Federal Reserve rate cuts and the continued weakening of the U.S. dollar.

Ownership and Share Structure

According to Refinitiv, eight insiders together own about 60% of Pasofino. The largest shareholder is Hummingbird with 50.78%, followed by ESAN with 9.6%.

The other three investors of the Top 5 are Pasofino Deputy Chairman Stephen Dattels with 3.97%, Pasofino Chairman Daniel Betts with 1.28%, and Pasofino Director Robert Metcalfe with 0.66%. Richards owns 0.59%.

The company has 117.03 million outstanding shares and 38.36 million free-float traded shares.

Its market cap is CA$70.32 million. Its 52-week high and low are CA$0.80 and CA$0.30 per share, respectively.