We chatted to IronRidge Resources' CEO Vincent Mascolo who explains why the company has become a lithium explorer. Watch the video here.
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Thanks Mr T. & whilst we await for the new contract wins be announced and tread water whilst the costs for the removal of waste are taken into account following the earth movement a few months ago, we can expect local costs to fall whilst the Egyptian govt takes up what is rumoured to be on Bloomberg an opportunity to take up 3Billion Dollars in Bonds! This would have the effect of usually lowering the local currency taking this out. Could be good news for Centamin as their costs will then reduce in real terms.
Would explain why the price hasnt risen when gold is up 45 dollars from the recent low
This share is absolutely woeful. Gold up and yet this is going down. Telsa have invested 1.5 billion dollars in Bitcoin. I'm so glad I have put money in Bitcoin to make up for this disappointing share.
What time was trade and presumably a single sell?
Reason Centamin did not purchase the Cat equipment, which is a fair point.
I am reliably informed that Centamin does have the option to buy some of this equipment once the Capital waste stripping contract is finished.
As yet I don't know precisely what equipment Centamin have purchase options on!
Centamin provided an update in their Interim Results saying the LHDR was up and running.
The underground delivered a total of 601kt of ore; 340kt from stope mining and 261kt from development. The ratio of stoping-to-development ore for the period was 55:45. Production equipment availability and utilisation issues experienced at the end of Q1, and early Q2, predominantly due to recurring damage to the long hole drill rig ("LHDR"), reducing stoping volumes and leading to an increased mix of lower grade ore-drive development tonnes. There have since been no further disruptions to the LHDR and stope tonnage improved in line with the revised mine plan. As a mitigating measure, an additional LHDR is due to arrive on site in the fourth quarter.
Also from media
Capital Drilling commissioned first remotely-operated blast hole rig at Centamin mine
Capital Drilling have commissioned their first remotely operated Blast Hole rig at Centamin’s Sukari mine. The operator is in a self-contained truck-mounted Drill Control module, a safe distance from the Remote Drill module, allowing safe and productive drilling in high risk work areas.
The 160km2 Sukari tenement area is located in the south-easterly region of the Eastern Desert of Egypt, approximately 700km from Cairo and 25km from the Red Sea. Sukari is the only operating gold mine in Egypt and Centamin believe the country has significant mining potential.
Capital Drilling Ltd (LON:CAPD) provide complete exploration and production drilling solutions to customers within the global minerals industry, with a focus on the African markets. Their services include: blast hole, directional, grade control, resource development and underground drilling services, together with geo-technical capabilities.
Hi Dasut & Ken, an official response-
Re The Times article
This is an article from the beginning of December 2019 and an opening shot from Endeavour, the long hole underground rig refers back to an incident in H2 2018.
As you may know Capital Drilling did not have anything to do with this as the underground operations (drill, blast and mining) are subcontracted to Barminco.
Centamin explained fully what happened re grade in the open pit at the time (in Q2 2019) when there was a transition period from mining oxide to sulphide ores – in a nutshell the transition zone took longer than expected for a variety of reasons
Correction : 15.3m and not 13.3m
Can we attach any significance to the large trade today of 13.3 million shares representing about 1.2% of the issued share capital ?
Yes I thought I had read it somewhere about the machine left in the blast zone well found.
I always say 2 heads are better than one, there’s a lot of info out there and sometimes you miss an article so I will always post it.
Tibbs from what I remember is that this information was way off beam as the blast was in the open pit and the rig is underground so fake news as some ex president would claim
As always Dasut for a really great explanation of things, thank you!
You are one of the old school of business specialist professionals who knows the job through experience as well as technical training and you have integrity, qualities that seem lacking in so many walks of life today!
Ken I thought I was up to speed with the fleet and can see that I am as far as Capital are concerned but missed the Centamin introduction of the 6040 shovel and now that is a big beast.
Hi Dasut & Ken,
There was a Times article that seems inaccurate to say the least in some of the detail?
"All gold miners enjoy a spot of pyrotechnics. Take Centamin. It had such an explosive day of it last year that it clean forgot to remove its own kit from the blasting zone. The upshot? A poleaxed “long hole drilling rig”.
Ken if Capital are up and running by the end of the month it will be limited to a few machines because it is a long job assembling this size of machine on site and if there are 20 plus machines and there will be a limited number of cranes etc. Unfortunately even though they are at the smaller end of mining machines they still need well trained engineers and mechanics and a lot of them to assemble the fleet. A very long job is welding truck bodies together let's hope Capital bit the bullet and paid the extra freight which is significant cost given added volume.
Not sure if the whole fleet arrived in one shipment which I suggest would be highly unlikely but if my old colleagues are involved then they have the experience, but must also bear in mind they are not just around the corner from the dealers premises or a production line.
Good news however is that the plant arrived from the US remarkably quickly, wouldn't surprise me if the dealer didn't have some machines already on order.
Ken interesting I wasn't aware that the LHDR was left in a blast zone and if so that is most unlike Barminco as they have an excellent reputation. As you will know it like all mechanical pieces of equipment they break and it can be the case that it is the most unlikely part that causes the issues. The issues being that the best engineers advise on what parts should be held on site and it is the one that wasn't thought necessary that screws you. Not only isn't on site but the manufacturers don't hold it as a stock item.
I have been involved in airfreighting a "component" for a machine larger than the 6020 to Ghana when there wasn't planes going to Ghana that were large enough to take the weight, you guessed it someone had to pick up the cost of a charter.
Also had people authorising taking components off the production line to satisfy a breakdown and that isn't a decision taken lightly.
Short of having a standby machine for every piece of equipment which isn't cost effective and can you imagine production walking past a machine standing idle because it is supposed to be only a standby, these are risks of the business.
If every mining contract indeed supply contract had a penalty clause paying compensation for lost production there wouldn't be any business done.
Morning Mr T,
Yes if I remember rightly they left the LHDR within the blast area which damaged the rig, consequently they didn’t have a replacement on site so had to wait for the parts to repair it.
In my opinion that was a very elementary mistake that cost a bloody fortune in lost production, so I hope they’ve learnt by that mistake and never let it happen again.
I agree with you in the hs2 that money could have been put to much better use, I think the cost has at least doubled from the initial bids which is crazy
I am familiar with penalty clauses and contingency allowances on civil engineering contracts ,unfortunately virtually every time the big plc's bid for central government contracts (HS2, Highways, NHS hospitals, schools they bid low with the intention of using the contingency sum and then when this is exhausted and the client tries to invoke the penalty clauses the plc claims this would drive them into into bankruptcy or force them to pull out, knowing full well the politicians are desperate to get the job done before the next election, so the project goes into overspend and taxpayer picks up the bill, HS2 is a prime example of public money being chucked at an unneeded and wasteful project just so the present government doesn't have to admit a mistake!
Back to Centamin though, you may be aware that in 2018 there was a severe guidance downgrade due it was was claimed by Andrew Pardey to hitting unexpected transitional grade problems in the open pit ( there is some doubt as to just how unexpected these low grades were, but that is another story as LT holders are aware)
Other reasons for the 2018 guidance cut mentioned briefly problems with spare part availability for plant , in fact the plant was the sole underground LHDR which was operated and the responsibility of Barminco, but as the LHDR was awaiting critical parts it was impossible to make up for some of the lost open pit production and instead amplified the overall problem.
It seems though despite the failure of Barminco's deliver the services they were contacted to they weren't required to compensate Centamin for lost production.
I understand this is common practice amongst many mining specialist service contractors in order to reduce the overall contracts charges to the client.
So I wonder would Capital be subject to penalty clauses on this contract and if so how much protection would it offer the client?
Yes I fully agree with your analysis, the mine has to keep producing, therefore subcontracting the work out is a very wise decision in order to put their expertise into extraction rather than just loading trucks with waste which is non productive.
I’ve actually done this myself when the labour force I have on board is not enough to get the job done in time, as you will be well aware a lot of construction work has penalty clauses if your part of the work isn’t completed on time and this can be very costly.
I believe capital should be up and running by end of this month
Thank you Viable,
From what others that have experience of the Sukari mine have stated in the past the area is honeycombed with old workings, it will be interesting hear their opinions on this.
Equities in Europe traded higher in the premarket on Monday ahead of the release of the latest reports on Germany's industrial production and the Eurozone's investor confidence. Meanwhile, European Central Bank President Christine Lagarde commented 2021 would be the year of recovering from the crisis caused by the COVID-19 pandemic. In the meantime, the United Kingdom and France saw the lowest number of coronavirus-related deaths in several months.
The DAX traded 0.66% higher at 8:01 am CET. At the same time, the FTSE 100 rose by 0.67%, and the CAC 40 went up by 0.57%.
The euro lost 0.10% to the dollar to change hands for $1.20374 at 8:01 am CET. A minute later, the pound sterling stood flat against the greenback to sell for $1.37321.
Breaking the News / JR
To Superior Intellect
I have again been pondering west wall considerations having yesterday reviewed block-caving procedures. The key word is "subsidence" and first-hand knowledge of it around Carletonville. See -
The tunnelling procedure(s) at Sukari is unknown. Sinkholes, etc at underground mine sites are widespread. In a nutshell I remain uncertain if ground movement at our mine can ever be overcome. West wall ops suspension could be a permanent feature.
Ken the only problem is that the waste removal isn't producing any ounces. OK it is a necessary evil got to be moved otherwise not exposing the ore body but Cey are spending a whole lot of money on Capital moving the waste. Far better than Cey moving the waste and having to use equipment that would otherwise be mining the ore.
I honestly like the idea of introducing a mining contractor my only reservation is that Capital's expertise is in drilling, however as I have previously mentioned this is actually more like a construction bulk earthmoving job than mining.
Tibbs, Ken first of all the 785 size truck is Cat's smallest mining truck at 150 short tons (US tons) or 136 metric tonnes and the 6020 shovel in Backhoe configuration if it has a bucket payload of say 22 metric tonnes then in very rough terms and not going into swell factors, bank and loose cubic metres, weight of material etc we are looking at 6 passes to load a truck (but swell factors etc might dictate less passes because truck is full based on volume rather than weight) and I would like to see a 5 pass load especially in waste where there is no need for selective mining, so more along the lines of the 6030 if based on weight, also not sure if this is available in a backhoe configuration however front shovel arrangement might also be better for waste movement.
As to why Cey didn't buy the fleet unfortunately I have no idea maybe management looking to concentrate on mining and can't justify the capital outlay for a fleet of equipment for a 4 year muck shift project? Maybe this is the way to introduce a contract miner in the longer term? Bear in mind I doubt it will only be the 17 trucks and 6020's they will also need Dozers to clean up around the shovels and spread the waste at the dump area and graders to maintain the haul roads and water tankers to keep the dust down , operators mechanics plus the supervisors, project team etc (considerable unbudgeted expense). Cey will now I would suggest be paying for tonnes moved so Capital incentivised to move as much waste as possible to generate the income so all good as the sooner the waste is gone the sooner Cey will be into the ore body.