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Dundee maintains “buy” rating at B2Gold in wake of initial gold pour from Otjikoto

Last updated: 14:34 12 Dec 2014 EST, First published: 15:34 12 Dec 2014 EST

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B2Gold (TSE:BTO) had its “buy” rating and $3.00 price target reinforced at Dundee Capital Markets after the Vancouver-based miner reported the first gold pour from its 90-percent owned Otjikoto mine in Namibia.

Dundee said the pour comes two years after B2Gold received its mining license and demonstrates the Canadian company's ability to bring new mines into production on-time.

“While the timing of this news remains consistent with our previous expectations and management's guidance,” analyst Joseph Fazzini wrote in a research note today, “this puts to bed any outstanding concerns regarding B2Gold's ability to pour gold by year-end.”

Dundee said it believes the initial gold pour represents a “key step to de-risking” Otjikoto, though the ramp-up towards commercial production will be the next and “more important” hurdle to overcome.

While B2Gold forecasts Otjikoto to deliver 140,000 to 150,000 ounces in 2015 , Dundee said it estimates the operation will help B2Gold’s 2015 production surpass the 0.5 million ounce mark.

“This production growth should elevate B2Gold into the realm of intermediate producers and ultimately lead to a valuation re-rating,” Fazzini said.

B2Gold shares have lost 10 percent so far this year and were trading at C$1.97, down 1 percent, at 3:11 p.m. in Toronto.

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