Dakota Gold Corp.'s (DC:NYSE American) Richmond Hill, as outlined in one of two newly prepared plans, is to yield a US$2.1 billion NPV5% and a 59% IRR, noted a Canaccord Genuity report.
Dakota Gold Corp. (DC:NYSE American) released the Initial Assessment with Cash Flow (IACF) of its Richmond Hill heap-leach oxide gold project in South Dakota, and it showed "strong headline numbers with room to grow," reported Canaccord Genuity Analyst Peter Bell in a July 8 research note.
"We believe there is opportunity for the feasibility study to grow the size of the resource, which could aid in further improving the overall economics of the project," Bell wrote.
Canaccord maintained its US$12 per share target price on the U.S.-based gold junior, trading at the time of Bell's report at US$4.04 per share, the analyst noted. From this price, the return to target is 197%.
Dakota Gold remains a Speculative Buy.
The company has 111.9 million shares outstanding. Its market cap is US$452 million (US$452M). Its 52-week range is US$1.84-4.11 per share.
The IACF outlined two production plans for Richmond Hill, one for its Measured and Indicated (M&I) resource, another for its Measured, Indicated and Inferred (MI&I) resources, reported Bell. For both, a US$2,350/oz gold price and a US$29/oz silver price were used.
The M&I plan outlines an operation processing 168,300,000 tons (168.3 Mt) at an all-in sustaining cost (AISC) of US$1,047 per ounce (US$1,047/oz) and cash costs of US$857/oz over a 17-year life of mine. Initial capex is estimated at US$384.1 million (US$384.1M) and sustaining capex, at US$604M.
With this plan, the economics are a US$1.6 billion (US$1.6B) after-tax net present value discounted at 5% (NPV5%) and a 55% internal rate of return (IRR).
Using a closer to spot gold price of US$3,350/oz boosts the NPV5% to US$2.9B.
Compared to this plan, the MI&I plan outlines an operation processing more tons at higher costs over a longer mine life, specifically 273.7 Mt at an AISC of US$1,050/oz and cash costs of US$912/oz over 28 years. Initial and sustaining capex are similar, at US$383.4M and US$616M, respectively.
The economics, a US$2.1B NPV5% and a 59% IRR, are better. With the higher gold price of US$3,350/oz, the NPV5% increases to US$3.7B.
Canaccord Genuity models a standalone, open-pit, heap-leach project based on MI&I resources totaling 382 Mt of 0.42 g/t for 5,100,000 ounces of gold (90% M&I and 70% Inferred), reported Bell. This would yield an NPV7% of US$2.53B.
If Canaccord uses a 5% discount rate versus 7% and a gold price of US$3,350/oz, the project NPV is US$3.39B, similar to the US$3.7B NPV in the IACF's MI&I plan.
Also, when Canaccord uses the same gold and silver prices and discount rate employed in the assessment, the adjusted NPV is US$1.93B, compared to the study's US$2.1B NPV.
"We found the IACF MI&I plan to be in line with our estimates, with key differences being a lower throughput, lower strip ratio, higher gold grades and recoveries, and slightly higher unit costs," Bell noted.
The analyst pointed out that with either plan, the project's economics likely could be improved by potentially expanding the resource with results of the current 24,384-meter drill program and incorporating the larger resource into the feasibility study.
Bell provided a timeline for major project milestone catalysts.
The feasibility study, already underway, is targeted for completion in early 2027. Construction then would start in 2028 with initial gold production following by 2029.
| Want to be the first to know about interestingSilver andGold investment ideas?Sign up to receive the FREE Streetwise Reports' newsletter. | Subscribe |
Important Disclosures:
Dakota Gold Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Dakota Gold Corp.Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.For additional disclosures, please click here.
Disclosures for Canaccord Genuity Corp., Dakota Gold Corp., July 8, 2025
Analyst Certification Each authoring analyst of Canaccord Genuity whose name appears on the front page of this research hereby certifies that (i) the recommendations and opinions expressed in this research accurately reflect the authoring analyst's personal, independent and objective views about any and all of the designated investments or relevant issuers discussed herein that are within such authoring analyst's coverage universe and (ii) no part of the authoring analyst's compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by the authoring analyst in the research, and (iii) to the best of the authoring analyst's knowledge, she/he is not in receipt of material non-public information about the issuer. Analysts employed outside the US are not registered as research analysts with FINRA. These analysts may not be associated persons of Canaccord Genuity LLC and therefore may not be subject to the FINRA Rule 2241 and NYSE Rule 472 restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account. Sector Coverage Individuals identified as "Sector Coverage" cover a subject company's industry in the identified jurisdiction, but are not authoring analysts of the report. Investment Recommendation Date and time of first dissemination: July 08, 2025, 06:50 ET Date and time of production: July 08, 2025, 06:50 ET Target Price / Valuation Methodology: Dakota Gold Corp. - DC Our target price is based on a 0.9x multiple applied to our forward curve-derived operating NAV less net debt and other corporate adjustments. Risks to achieving Target Price / Valuation: Dakota Gold Corp. - DC Commodity price risk: As a precious metals exploration and development company, Dakota's future revenue is dependent on the price of gold. Mining risk: Dakota faces the typical risks inherent to mining companies relating to operating and capital costs, availability of capital, permitting requirements and timelines, technical and operating parameters, reserve and resource models, social license and community relations, taxation and royalty regimes, and regulatory and political risks. Development risk: Dakota Gold has various properties in South Dakota, USA, and is engaging in exploration activities to possibly advance them to a producing mine in the future. The company faces risks associated with developing the project, including capital and operating cost risk, financing, project permitting and timelines, and technical risks to achieve the planned operating rates. Exploration risk: Our model assumes continued exploration success in the Homestake District, as it assumes completed drill results will be brought into a NI 43-101 / S-K 1300 compliant mineral resource/reserve estimate and eventually converted into a producing mine. If the company does not find additional success with the drill bit, there is material downside to our base case valuation. Permitting risk: The properties in the Homestake District are in a very early stage, and, as such, has yet to engage in permitting outside of those required for exploration. As such, the company may not be able to proceed with the project as it is currently envisaged if the required permits to mine on the property are not received. Financing risk: As a pre-cash-flow development company, Dakota is reliant on the capital markets to remain a going concern. At present, the company has a cash position of US$35M (as of June 30, 2022), which positions it well in the near term to continue to advance its portfolio of exploration-stage projects. We note that there is no guarantee that Dakota will be able to access capital markets in the future, as the result of potential changes in market sentiment/pricing and/or concerns involving project feasibility. As such, there is no guarantee that the company will be able to secure the required funds to advance its projects in the Homestake District, including but not limited to debt/equity financing and/or a strategic investment. Delineation of gold resources: We currently model a conceptual resource, which is not considered economic as defined by 43-101 / S-K 1300. Conversion of drill hole intercepts into mineral resources and subsequently to reserves is largely a product of drill density as well as the applied economic parameters, which include commodity price and cut-off grades applied to the resource. Should the company not be able to find the conceptual resource we project, or not be able to convert the resources to reserves, this would decrease our life of mine and therefore economics for the project, all else equal. With such a preliminary conceptual mine plan, we caution investors that risk is high. Dakota has yet to achieve even a maiden resource for this project and has only performed a limited amount of drilling. Based on our industry experience coupled with historic drill results, and the drilling performed to date, we have utilized a volume-weighted average mass-based tabulation of available data (grade multiplied by width). This is a crude resource calculation method and presents considerable risk to our base case. We do not have access to all drill hole intercepts and do not employ 3D modelling software such as DataMine or LeapFrog.
Canaccord Genuity Ratings System
BUY: The stock is expected to generate returns greater than 10% during the next 12 months.
HOLD: The stock is expected to generate returns from -10% to 10% during the next 12 months.
SELL: The stock is expected to generate returns less than -10% during the next 12 months.
NOT RATED: Canaccord Genuity does not provide research coverage of the relevant issuer.
Given the inherent volatility of some stocks under coverage, price targets for some stocks may imply target returns that vary
temporarily from the ratings criteria above.
*As of January 1, 2024, the Ratings History Chart will reflect the new Canaccord Genuity Ratings System as defined above.
Risk Qualifier
SPECULATIVE: The stock bears significantly above-average risk and volatility. Investments in the stock may result in material loss.
12-Month Recommendation History (as of date same as the Global Stock Ratings table)
A list of all the recommendations on any issuer under coverage that was disseminated during the preceding 12-month period
may be obtained at the following website (provided as a hyperlink if this report is being read electronically) http://disclosuresmar.canaccordgenuity.com/EN/Pages/default.aspx
Required Company-Specific Disclosures (as of date of this publication)
Dakota Gold Corp. currently is, or in the past 12 months was, a client of Canaccord Genuity or its affiliated companies. During this
period, Canaccord Genuity or its affiliated companies provided investment banking services to Dakota Gold Corp..
In the past 12 months, Canaccord Genuity or its affiliated companies have received compensation for Investment Banking services
from Dakota Gold Corp. .
In the past 12 months, Canaccord Genuity or any of its affiliated companies have been lead manager, co-lead manager or comanager of a public offering of securities of Dakota Gold Corp. or any publicly disclosed offer of securities of Dakota Gold Corp. or in
any related derivatives.
Canaccord Genuity or one or more of its affiliated companies intend to seek or expect to receive compensation for Investment
Banking services from Dakota Gold Corp. in the next three months.