Register
Login:
Share:
Email Facebook Twitter

Early Stage Investment Opportunities: SyndicateRoom, investing from idea to IPO. Watch here

Share Views Episode 9 - Early Stage Investment Opportunities


Member Info for JDwag


Send a private message to JDwag

Member Since: Mon, 16th Jan 2012

Number of Share Chat Posts (all time): 5,704
Number of Share Chat Posts (last 30 days): 16

Last Posted: Sat 17:08


Post Distribution over the last 30 days




Sat 17:08

Yes, all of the posts paint a picture I guess!

It's quite a large bridge that Orion would have to burn, pension funds, PIs, Investment Companies, the EPC Contractor who actually built it, also, the Namibian Government also own 27m+ shares here as per the 2014 Circular. You'd need to start to rub them up the wrong way also!!!

JD
Fri 21:46

Can it happen? Yes! Will it? I don't think so!

Orion have sunk the thick end of USD$100m into Tschudi via a mixture of multiple loans (Tranches A, B, C, D) and the share purchases in 2015 at (2p a share) and that's before we even get to the Capitalised Intrest accruing on all of this money (Libor (minimum of 2% per annum plus 7%) since 2013!! It's now way, way north of USD$100m.

Orion want that back, and for me, they have no need to take this to another company as operator, they (using the BoD) have quite rightly spent the last 18 months 'restructuring' WTI down to a minanilist shell of a company operating Tschudi (obviously as a cost of Orion keeping Tschudi at WTI) gone are the big salary directors, fancy London digs and the loss making operations (which Orion paid to be put under care and maintenance). I did a 'fag packet' calculation not long ago, based on the annual accounts if you add up the savings lately not included in the annual accounts such as cost savings on new offices and less staff (BoD registrations) this company is 'probably' (don't know for sure) has central operating costs of no more than about £1m or so a year, not bad for a company running a 17k per annum Cu Mine.

Basically, if Orion wanted Tschudi they would have triggered default a long, long time before now, they wouldn't have kept the lights on an continued to plié more money in, also, and no small matter is Orion's good reputation, they are not a two but operator, look in their website, they have USD$ Billions under investment, I don't think they are in the business of taking back mines unless they believe management isn't up to it, also, you get into the position of this ending up in litigation if default is triggered, for that, for me the easiest path of getting their cash back (and then some) for Orion is allowing this to play out.

Worth remembering, if WTI make a go and success of this, the 24% shareholding Orion have could well be worth tens of millions of dollars not to mention the dividends they will make once all debt is paid off and they take home 24% of all dividends.

The path to least resistance for me is to all this to play out and make a killing in the process. I may be wrong of course and come February they call in the loans? But if they wanted the asset back that much? Why give another 6 month extension with few strings attached?

I may be wrong of course, and default is triggered, after all the SP here is priced for default.

JD
Fri 12:02

Away from Weatherly’s obvious need to pull the finger out, there does seem to be increasing confidence in Cu going into 2017, of course because the Cu market has become so opaque it has become all but impossible to determine when any real shortages will show up, hence a bewildering spectrum of opinions on the Cu Market / Price over the next 12 months or so.

As for the USD / ZAR, considering we will have U.S. interest rates going up as some point in the near future (December probably), the probable arrest / charge of the SA Finance Minister (with a deteriorating SA political climate to boot) and with a possible downgrade to junk status in December this year for SA, I still fully expect the USD / ZAR to go to an all-time low of 1 / 17+ sometime in the next 6 months (as do a lot of analysts), calm before the storm on that one I think.

All of this will help, but, we do have a rough 6 months ahead of us here, all payments / interest related to Tranche’s B, C and D seem to have been ‘capitalised’ until end of Feb 2017, at this point (assuming nameplate production is back on track at the end of 2016, god let’s pray it is) I personally think it will all be re-forecast in to a repayment schedule which will probably take until the end of 2021 to repay (current repayment schedule says Feb 2020). This is just opinion of course!!

I did some sums the other day on ore depletion based on an average of 18.5K tonnes Cu mined per year at Tshudi, and if this was the case, then 2022 onwards (after repayments) we would have 5 / 6 years of free flowing cash going back to shareholders, of course, there is still the opportunity to prove up the rest of the asset to a reserve status so the LoM could easily be extended. Of course, it was only 5 years ago we had Cu at USD$10k+ per tonne, who is to say in another 5 years from now that it isn’t back there on chronic Cu supply shortages? We can hope!!

Luckily for us, our largest Shareholder / Loan Note Holder is in this ride to the bitter end, when you add up loans (and capitalised interest to date) and shareholdings, it’s an eye watering sum, the only way they will ever get their cash back is to allow this project to play out under the streamlined shell that is now Weatherly PLC.

JD
Fri 11:09

As for MCPP, delays happen, I don’t mind an extra three weeks for them to count up all them zeros (what’s three weeks in 3+ years).

As for Imweru, it looks like they merely took the path of least resistance to commercialisation, and with no dilution to existing shareholders at Kibo PLC. Can’t blame them really, it will give us a standalone main listed company where we can actually count how valuable Imweru, etc is to us on a daily basis, and will give some real actual NAV via our OPRA shareholding to add to Kibo’s balance sheet. So, basically, we will have two full listed PLCs set up to house our assets (even if one is no longer 100% owned by us), I guess just another one for Haneti to be listed under and we will have those three separate companies that Wimbles / Sonic spoke of way back!!

Of course, while Imweru will grow in value over time (they obviously have a bit of painful fundraising to go first at OPRA) the main event is and always has been MCPP, roll on the next few weeks.

JD
Thu 09:01

Indeed, but I'm trying to save my despair for the Q3 Update out in a few weeks, considering what the initial CAPEX costs of the water management programme could do to our C1 Costs for the quarter it could be a right kick to the face this one.

JD
Tue 16:56

Just out, looking good (if the ICSG data is to be believed), shows an apparent deficit amplifying over the last few months, and the trend is certainly encouraging, key bits:

June’s ICSG Data:

‘According to preliminary ICSG data, the refined copper market for June 2016 (excluding the adjustment for changes in China’s bonded stocks) showed an apparent production deficit of around 83,000 metric tonnes (t) mainly due to strong Chinese apparent refined copper demand. When making seasonal adjustments for world refined production and usage, June showed a production deficit of about 47,000 t. The refined copper balance for the first half of 2016, including revisions to data previously presented, indicates a production deficit of around 306,000 t (and a seasonally adjusted deficit of about 227,000 t). This compares with a production deficit of around 54,000 t (a seasonally adjusted surplus of about 27,000 t) for the same period of 2015.’

In the first half of 2016, world apparent refined usage is estimated to have increased by around 5% (570,000 t) compared with that in the same period of 2015 mainly due to strong Chinese apparent demand. Chinese apparent demand increased by around 11% based on a 20% increase in net imports of refined copper from the lower net import level in early 2015 and consequently lower apparent demand. Excluding China, world usage remained essentially unchanged. On a regional basis, usage is estimated to have increased by 5% in Europe and 7% in Asia (when excluding China, Asia usage declined by 2%), while declining by 17% and 4% in Africa and in the Americas respectively and remaining essentially unchanged in Oceania.’

Compared to May’s ICSG Data:

'According to preliminary ICSG data, the refined copper market for May 2016 (excluding the adjustment for changes in China’s bonded stocks) showed an apparent production deficit of around 65,000 metric tonnes (t) mainly due to strong Chinese apparent refined copper demand. When making seasonal adjustments for world refined production and usage, May showed a production deficit of about 24,000 t. The refined copper balance for the first five months of 2016, including revisions to data previously presented, indicates a production deficit of around 222,000 t (and a seasonally adjusted deficit of about 181,000 t). This compares with a production deficit of around 39,000 t (a seasonally adjusted surplus of about 10,000 t) for the same period of 2015.'

JD
Tue 11:28

Can't beat a Police Academy joke!!!

JD
16 Sep '16

Like Helium (88% the lifting power of Hydrogen you know)))))

JD
14 Sep '16

Lol, thanks mate, I'll be back as someone once said.

JD


Sign up for Live Prices
Top Recommended
Hot Chat Topics
Top recommended posters in the last 30 days
bonker995,955
Wassatt4,745
Aberdeenman1,928
Troajan1,762
liamnicholas1,339
freeasabird1,187
kenny1001,137
DavidGreece1,133





Member Login

Forgotten your password?
Email:

Password:


Don't have an account? Click here to Register Free!




Datafeed and UK data supplied by NBTrader and Digital Look. While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.