-- adds broker comment, share price --
Condor Gold (LON:CNR) has ended its formal strategic review and immediate plans to sell the business.
The review started in September, but Condor’s share price has dropped sharply with the junior gold sector since then and the board does not see that any offer now would reflect the company’s underlying value.
Condor's current market capitalisation is equivalent to around US$5 per resource oz gold in the ground compared to an average sale price over the past 18 months of US$56 per resource oz for similar gold mineral resources.
Its main La India project in Nicaragua hosts a resource of 18.1M tonnes at 4.0g/t containing 2.32M oz gold, which includes an open pit mineral reserve of 6.9M tonnes at 3.0g/t gold containing 675,000 oz gold.
All-in-sustaining-cash costs were forecast to under US$700 per oz gold in a pre-feasibility study.
Condor said it will continue with the development of La India and has applied for a permit to produce 100,000oz gold per annum from a single pit.
Cash holdings at end December were £1.1mln.
Broker Numis added Condor has made significant process with the optimisation study, the submission of the environmental impact assessment and identification of 30 targets for further exploration.
SP Angel added that La India is a sound project with a substantial resource at relatively high grades of 4g/t and competitive operating costs, but the dilemma is how to proceed with the limited funds available.
Shares eased 1.5p to 17.5p.