Aurizon Mines Ltd. (AZK), which is re-developing the Case Berardi mine in northwestern Quebec, has seen its shares rise roughly C$1.50 in the past twelve months.
The company successfully fended off a takeover attempt from Northgate Minerals Corp. (NXG) last year, but continued merger and acquisition activity in the mining sector has reduced the number of Aurizon’s peers.
With the mine scheduled to begin commercial production in the second quarter of 2007 and company forecasts of 200,000 ounces of annualized gold production expected by the middle of the year at a cost of US$250 per ounce, Wellington West analyst Catherine Gignac likes the company’s prospects.
She has a “buy” recommendation and C$5.25 price target on Aurizon shares, which represents upside of more than 30%.
The company will focus on exploration once commercial production is achieved, Mr. Gignac said in a note to clients, adding that its resource could be expanded significantly if encouraging drilling results from new zones from within the mining area pan out.
“Aurizon is a straight-forward one-mine company, with a renewed focus on exploration and resource expansion, Ms. Gignac said, adding that the Quebec region is friendly to mining companies.
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