Laneway Resources’ Share Price Sparks Confidence on Gold Campaign

At time of writing, Laneway Resources Ltd [ASX:LNY]’s share price has stabilised and is currently valued at 14 cents a share, which is trading higher than yesterday’s share value.

Mining and demolition activities began this week at Agate Creek, the company’s premium gold mining project in North Queensland.

Related: Three reasons you should add Gold to your Portfolio in 2019. 

Laneway anticipating a ‘strong year

The company this morning announced that the first ore blast happened yesterday afternoon, with ore processing expected to begin shortly after. The high-grade ore will be processed at Maroon Gold Ltd’s own CIL processing plant, at Charters Towers, as part of an earlier deal.

The process will see 60% paid to Laneway and 40% to Maroon after gold production. Agate Creek has historically produced more than 3.7 million ounces of gold.

The latest drilling campaign in January showed high-grade gold intercepts, with many sections showing over 100 grams of gold per tonne.

What does the long-term financial strategy look like for Laneway?

Given the recent economic downturn and the inevitable rush towards gold stocks, Laneway say that they are confident in a ‘positive cash flow from the mining activities at the Agate Creek high grade project aided by recent high prices for AUD dominated gold.’

The company hopes that the expected cash flow will help with their progress towards a larger project portfolio, including its Ashford Coking Coal project and further exploration of its gold projects in New Zealand.

Shares for Laneway have increased in value by 180% in the last month, but this has been tempered by extreme volatility since the beginning of the year.

This is a chance for Laneway to improve upon its balance sheet and fundamentals — provided their initial results validate their long-term goals.


Ryan Clarkson-Ledward,
For Money Morning

PS: If the latest developments in gold have piqued your interest, then you should consider Greg Canavan’s new report: ‘Three Reasons to Add Gold to Your Portfolio Today’. Read the free report now.

Ryan Clarkson-Ledward is an Editor at Money Morning.

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