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Greatland Gold Expands on Havieron Drilling – What Does This Mean?

Tim Worstall
Tim Worstall trader
Updated 10 Mar 2022

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Key points:

  • Greatland Gold has a significant prospect at Havieron
  • Greatland also has a small problem with Newcrest Mining
  • We’re thus being updated by Greatland on events at Havieron
  • Best Gold Stocks to Buy Right Now

Greatland Gold (LON: GGP) shares have a small problem. No, not to do with the company’s actual prospects, the quality of the deposit they’re exploring, nothing serious like that. Rather, there’s some confusion in the information flow and this is having an effect of the Greatland share price. So, we’re getting a series of announcements from Greatland to try to clear up this information confusion.

The latest from Greatland is about “drilling building momentum” at Havieron. Which doesn’t sound hugely exciting but then that’s not really the point of the exercise.

Think back to what a junior miner has to show. That it has the rights to explore and extract in an area – Greatland has those. Then it’s necessary to show that there’s something worth extracting in that area. That’s the work that Greatland Gold is currently undertaking at the Havieron site. OK, great, but why is there a problem here? Well, Newcrest is also working right beside at Havieron, which isn’t a problem in itself, it’s the information flow from there.


Also Read: Greatland Gold Stock Forecast

For Newcrest announced resource figures for the deposit. These clashed somewhat with Greatland Gold’s resource numbers. That’s not a happy thing, the two numbers should be the same. The explanation is simple enough as we’ve detailed before. Newcrest was using numbers from a year ago in its declaration to the Australian stock market about the resource. There was a specific cut-off date for that information and so that’s just what they did. Greatland, in contrast, has been announcing the results of the work that has been done since that year-old cut-off date. That explains the discrepancy between the two numbers.

This is important, of course it is, for at this stage of the mining exploration game the value of Greatland shares is determined by what we think we know about the resource they might be able to mine. The more gold there is the more Greatland is worth. The whole point of this current stage of exploration work is to check, prove, how much there is. So, to have an up to date valuation of Greatland we have to use the most recent announced numbers. Not whatever numbers Newcrest had to use in its release to the ASX.

Which does rather explain why we’re getting a series of releases from Greatland about what is going on at Havieron. Yes, the results are both good and interesting. They are finding good mineralisations in decent quantity. Far too early to be able to declare a firm valuation but indications are that there’s something useful there.

But the more we get releases on this point then the more we’re going to overcome those year-old numbers that were released by Newcrest. The value to Greatland of these releases isn’t, perhaps, in the precise details of them, but possibly in overlaying the incorrect ideas we might hold from those year old and now incorrect figures.

Tim Worstall
Tim Worstall is a freelance writer specialising in economics and the financial markets.