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VIDEO EXCLUSIVE: TSX-listed Transglobe Energy Corporation considers London listing Watch here

VIDEO EXCLUSIVE: TSX-listed Transglobe Energy Corporation considers London listing


Member Info for JDwag


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Member Since: Mon, 16th Jan 2012

Number of Share Chat Posts (all time): 6,180
Number of Share Chat Posts (last 30 days): 62

Last Posted: Mon 11:43


Post Distribution over the last 30 days




Mon 11:43

1000 tonnes per month that should of course read.

JD
Mon 11:42

Agree, they are also hedging on an upward curve, each hedge is getting a higher and higher price, that is one of the benefits on hedging out 6+ months, you can then take your time to hedge at a point within the next 6 / 7 months at an advantageous price, for example if the price hits $7k+ per tonne again in the next 6 / 7 months (good chance IMHO) should they then fix another 1000 tonnes per annum at 3 – 6 months out (beyond the current March 2018 hedge at that $7k+ per tonne? IMHO, absolutely they should.

JD
Sun 17:21

BTW I'm not expecting a real turnaround here in getting C1 Costs to a level considered acceptable until probably Q2/Q3 FY2018 (Jan or Apr 2018 quarterly updates).

JD
Sun 17:13

Orion have always shown that they will back WTI going forward on debt rescheduling, of course this has limits like anything, however if they can get back to the BFS numbers and get C1 Costs down to circa $4k (remembering that Cu is approximately $6.5k currently and so is the hedging Jan to Mar 2018) then you could easily conceive a scenario where at 20k tonnes per annum looking at this turning over $50m in revenue per year, that in itself is on 2.5x debt to revenue ratio, if they perform strong through 2018 then you are looking at a <2x debt to revenue ratio, that is perfectly acceptable in business terms, as the ratio declines the MCAP increases steadily.

You obviously have the prospect of their other assets being brought back on line with a 10-12k per annum asset with no debt, fixes or hedges to play with for a $10m outlay (given time to ramp up).

Look, there is a reason why this SP lays in tatters, the market doesn't have a great deal of faith that as things stand there will be anything left for shareholders past paying off the debt, I beg to differ, and if I am ultimately proved right in hanging on in here you'll be looking at multiples of this SP. But the risks speak for themselves.

JD
Sun 15:48

Of course, the extended USD$10m facility will add to these numbers.

JD
Sun 15:44

Disagree on the hedging, the USD$6,464 for example was perfectly sensible as was the currency fixing, in fact I take it as a positive that they decided they want their costs / sales fixed at those levels, hopefully bodes well for the next quarterly update. Besides, Orion would have demanded this and we are in no position to argue.

Debt stood at USD$115m (shown on the presentation on the website) its growing at approximately 10% per annum, so come June 2018, this will stand somewhere in the region of USD$126.5m or so.

If they can get Tschudi purring at 20k tonnes per annum at a delta of >USD$2,000 per tonne (means getting C1 Costs down to approx USD$4,000 or so) I don't see this as the biggest issue, actually.

All in the C1 Cost numbers IMHO, Cu prices later in the decade will take care of themselves.

JD
Sun 12:30

It's a very good question and as you say it will define ultimately where the SP goes!

It would appear to me that the amount of recoverable copper per tonne (stated in the BFS as approx 85%) doesn't seem to be the issue, it's the leaching rates that are and these do not appear to be leaching at the rates outlined in the BFS. If that is the case then it (hopefully) is just a question of getting sufficient ore stacked and allowing the leaching times to get the liquor up to full strength to allow for the copper cathode stripping rates to return to nameplate levels (and hopefully a good bit more). As for timeframes? Difficult question, with the mixed ore we could still be looking at another 6 months from now until these have leached sufficiently in order to get the liquor up to the required strength (don't know that's just a number).

Only at that point will we start to see C1 Costs level out and know if this is a profitable operation or not, it may also be the case that the current leach rates may be an easy fix by changing the site parameters, but that's just musing.

IMHO I think we will see a big jump in tonnage this quarterly update coming as the 6 months or so since the start of the phase 2 leach pads and the overstacking and sealing take effect, however, I still expect the costs to be high due to the factors above.

JD
Sun 10:35

Not convinced either by that argument, I remember the discussions at Rail Privatisation in the mid 90s saying rail use was to level off, decline even over time, 20 years later and rail passenger travel has doubled in this country.

JD
Fri 15:46

Always been very interested in ‘Futurism’. I was convinced when I was younger (less so now) that Thomas Robert Malthus was correct in theorising that overpopulation would eventually consume all earth’s resources and eventually lead to catastrophe (of course there is time yet). However, we always seem to adapt and re-invent ourselves and create the technology to manage (‘necessity is the mother of invention’ and all that I guess), we are going to have to do this again on a scale never conceived by the likes of Malthus 250 years ago for a world with a population of 9 billion come 2050 and the large scale mechanisation of production.

On a micro basis, that of course means humungous amounts of copper:

https://uk.reuters.com/article/uk-electricity-autos-charging/energy-firms-battle-startups-to-wire-europes-highways-for-electric-cars-idUKKCN1BQ0IZ

JD
Fri 14:16

http://gas2.org/2017/05/11/death-spiral-oil-auto-industry-will-complete-2030-says-futurist/

Interesting subject, if he's right, tectonic changes lay in wait for society.

JD


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