June 29 (Reuters) - Shares of Alamos Gold Inc rose as much as 9.3 percent after the miner reported positive results from a pre-feasibility study conducted at its gold projects in Turkey.
The company said it expects average annual gold production of 166,000 ounces over the nine year combined life of the Agi Dagi and Kirazli gold mines located in northwestern Turkey.
The mines hold a total of 1.5 million ounces of gold and 4.9 million ounces of silver, Alamos said in a statement on Thursday.
Analysts were, however, cautious, flagging concerns over likely delays to start of production.
Macquarie analysts reduced their price target on Alamos’s stock to C$19 from C$20, citing concerns over environmental permits that may delay start of commercial production.
“Final environmental impact studies approval timelines for Kirazli and Agi Dagi have been pushed back six months to first and second quarter of 2013, respectively,” the brokerage said in a note to clients.
Macquarie said it expects commercial production to start in early 2015, “but see the potential for further delays to emerge,” and maintained its “outperform” rating on the stock.
Alamos sees first gold production from the Kirazli project in 2014 and from Agi Dagi in 2016.
Dundee Capital Markets and Desjardins also cut their price targets on likely delays due to revisions in the environmental impact assessment but maintained a “buy” rating.
Dundee cut its price target on the company’s stock to C$24 from C$25 and Desjardins lowered it to C$21.25 from C$24.50.
Frazer Mackenzie raised it price target on the stock to $25.00 from $24.75 as it expects higher gold production and maintained its “strong buy” rating.
Shares of Toronto, Ontario-based Alamos were up 8 percent at C$15.66 on Friday on the Toronto Stock Exchange. They touched a high of C$15.87 earlier. (Reporting by Maneesha Tiwari in Bangalore; Editing by Sriraj Kalluvila)