Broker and Nomad to Medusa Mining, Fairfax, initiated coverage of its client with a 'buy' stance today.
In the research note titled " A Golden Opportunity", Fairfax said that it had calculated a net present valuation on Medusa of 106 pence per share based on cash costs of US$245-220/ounce over a 15 year mine life with a gold price of US$830/ounce in 2008, rising to US$900/ounce in 2009 and then gradually falling to US$700/ounce by 2013. Fairfax also pencilled in production building from 20,000 ounces this year to 150,000 ounces by 2012.