Yes, if this chugs along for the next few months, I don't mind that, but beyond that will be stretching it a bit. The market wants to see what will happen now BMR has the ZEMA vote of confidence. Good point re the off-takers, they won't fall for any MA stalling tactics while he waits for prices to rise. Fair deals can be struck now.
Still thinking once we've proved a working model at Kabwe, we'll be sold though. Just my personal view. If nowt happens until the metals prices rise, this will add to my theory.
We'll have to wait and see. Value can be worked out, even if we aren't producing anything, MA will factor in the 'onny/offy' button, or production costs. Going back to the underground ore bodies, and whatever isn't JORCed. That doesn't matter to the Chinese, as they have their own equivalent method to JORC, so the value there won't be a miserable one, i.e. just because it isn't JORCed.
As for the new brokers, I think when they saw the asset sheet and no figures whatsoever, they collectively spontaneously combusted mid-read. Lol.
Thanks Eric. I also thought they may have a particular metals price in mind after which they'd start cranking things up, either that or a fixed date, whichever is sooner - say the start of next year. Just early enough so the offtakers are not tearing their hair out watching the prices rise.
Agreed, they can factor in discounts etc but why begin processing and selling our best grade (17%) asset the WPS while prices are low when we could be getting a much bigger margin if we waited till nearer 2016? A 50% rise in metals prices would probably translate into 3x - 4x rise in profit margins since the fixed costs will be the same.The WPS will only last 4 years so why risk selling a good chunk of it for much less than we could later on? The difference in revenue could be $many millions. OK it's concentrates rather than metal so margins will be proportionately less, but the same principle should apply.
Thats right ED rising prices positive for direct company sale or raising capital investment. At the moment what is it they actually have to sell though? Difficult to value and sp to low. What will be a game changer?
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.