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Greatland Gold Unmoved On Havieron Update – What Will Move Shares?

Tim Worstall
Tim Worstall trader
Updated 28 Apr 2022

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Key points:

  • Greatland Gold is largely unmoved, 0.75% change, on Havieron update
  • The news is better mineralisation is being found
  • So, what will actually move the Greatland share price?
  • Gold Trading: The Essential Guide

Greatland Gold (LON: GGP) shares are largely unmoved on an update to the Havieron project. Given the number of updates we do have from Greatland concerning that Havieron project, it’s worth asking, well, what will actually move the share price? The answer to that is that we need some substantial news instead of the continuing stream of changed details.

At this current stage for a junior miner – defined, recall, as someone not producing as yet – there’s a lot of work that needs to be done to prove – fully prove – the things that we think we already know. Every new small piece of information is another brick in that wall of proof. So, we might get an update on a further stage of the drilling programme. This shows that there’s an extension of the mineralisation. Or that the gold levels are a little better than thought – or possibly a little worse.

Simply because of the stage, we’re at, none of these make a great difference to the total project value. We already know there’s good mineralisation there, that it’s worth mining. Well, we know that from the Newcrest activities, we’re not wholly certain that this extends over to the Greatland Gold part of Havieron. But we’re still left with that point that each of these new details is just that, a detail adding another dot of paint to the total picture.

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This is why despite the constant flow of news, we’re not seeing breakouts in either direction in the Greatland Gold share price.

This specific announcement is as with one a couple of months back. Newcrest has announced to the Australian exchange, given the intertwined nature of the project then Greatland should – must – announce too. What’s different about this Greatland/Newcrest announcement is that they’re both saying the same thing. That earlier one differed because the two companies were using information from different time periods.

In this announcement, we do indeed gain more of those details on the drilling programme. There’s more material there than previously thought, better mineralisation as well. But again, that’s a detail to add, not a stepchange in what we previously knew. We also get told that Newcrest has had some problems in their closely related activities. Weather and geology making things a little harder but these being problems that will delay, not confute, activity. They still expect to come online with production in 2024.

The total effect of all of this is roughly neutral for Greatland. Yes, OK, slightly better mineralisation found which might lead to more reserves at some point in the future. Certain technical difficulties with Newcrest. All in all, just nothing of sufficient size to particularly change a valuation of the project as a whole. So, no significant price change in Greatland shares then.

It can be frustrating to get this series of news and see no price movements. But that’s just a function of the news itself – refinements of detail – and the project stage. The project stage being where details are refined.

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