DGRS - Gold Resource: Back Forty Looks Good On Paper But I Have Funding Concerns

• The Don David gold mine is expected to produce 24,000-26,000 ounces of gold and 900,000-1,000,000 ounces of silver in 2022.
• However, the focus of the company is shifting to the Back Forty project in Michigan, which has an NPV of $259 million at $1,300 per ounce of gold.
• My main concern is that the peak funding requirement is $296 million, which needs to be secured before construction starts in early 2024.
• In addition, Back Forty is burdened with gold and silver streams, and cash flows will be limited in the first two years of production.
• I think that investors should avoid the Gold Resource’s stock until the funding package takes shape.

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