Summary
- B2Gold produced 245,140 Au oz in the fourth quarter of 2019 and sold 218,437 Au oz. 2019 production was above guidance.
- Total revenues for the fourth quarter of 2019 came in at $324 million or 19.4% above the same quarter a year ago.
- B2Gold presents an attractive profile for long-term investment, and I qualify the company as a long-term "keeper." But it is crucial to trade short term as well.
Source: Mining Review Africa - Fekola Mine
Investment Thesis
Vancouver-based gold miner B2Gold Corp. (BTG) is quite an attractive gold miner that I am regularly following on Seeking Alpha. The long-term potential is evident when we look at the mining assets and their location in the chart below.
I started to cover this miner at the right time, and I believe a few followers have been lucky to discover this company through my articles a few months back. What characterizes B2Gold is that the mining model is simple and powerful.
The investment thesis has not changed, and this gold miner presents an attractive profile for long-term investment, and I qualify the company as a long-term "keeper." However, while B2Gold can be considered as a long-term investment, it is crucial to trade continuously about 30+% of your position short term to profit plainly from the volatility inherent to the gold industry and the risk of an operational hiccup.
The mining model is centered around the company's flagship mine called Fekola in Mali (80% owned by BTG and 20% owned by the Government of Mali).
The mine is an invaluable mine with steady gold production proceeding with an expansion project that will be completed around the Q3'20 with a forecasted gold production between 590K Oz and 620K Oz this year.
More good news coming from Fekola Mine is the recently updated mineral resources and the new Mali's mining code that adds more stability.
Under a new mining code, companies operating in Mali will be protected from fiscal changes for 20 years, down from the previous "stability period" of 30 years, the mines minister said late on Thursday.
Furthermore, the cost of extraction will be going down by 7% after the achievement of a new large-scale off-grid solar plant projected operational in August this year.
However, the Fekola Mine is not without problems due to extremists' activity, Government corruption, and inefficiency, that seems the general practice in Africa.
The company is producing gold from five different mines spread around the world. It is involved with one development and one exploration project as well (a joint venture in Colombia with AngloGold Ashanti (NYSE: AU) called Gramalote and Kiaka/Toega in Burkina Faso).
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