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Excuse the spelling!
Good morning Tom the bomb,
Nice lost and I agree with almost all of it,the only part I think we need to revise upwards is the 33m capex cost by Hannam, this will increase but there is a very very good reason for this!
Block cave bulk mining! That 33m was based on the decline and Hugh grade stoking operation, a block cave will cost more,how much more I don’t know,could we get the finance? In a heart beat.
Block caving changes the game, whilst it will also increase the costs, those cost are gladly incurred for the rewards of a AISC 70% less than our peers!
What is clear is that capex will not be a problem given the economics of havarion and the proximity to telfer.
A very very good “problem” to HAV.
Ducks ducks ducks
‘ For GGP to mine ourselves where do get the money ? We don’t earn any money atm. Maybe raise equity and dilute shareholders? No thanks , a buy out would do just fine’
Firstly, Gervaise said he would look to debt finance if the 5% didn’t cover our costs, but that is now going to be extremely unlikely as 5% is expected to bring us in £350m+. The sale of 5% will also give us plenty to prove up
any other projects in the Paterson that come back with good drill test results. Secondly, Hannam & Partners have estimated capital costs of US$33.9m to be attributed to Greatland.
No one should worry about the ability of Greatland to mine Havieron. That’s what makes the investment case so strong. Havieron is the company maker and Scallywag is a key part of their growth strategy, according to Gervaise.
Sit back and let those gains come.
H&P said the following in May:
‘ Currently Greatland Gold are in a strong negotiating position, as they should be able to easily raise their share of funds required to pay for the capital costs to bring Havieron into production and therefore avoid further dilution of their holding. This makes the case for Newcrest to take its ownership to 100% even more compelling. Greatland’s current market cap is £319m or US$390m, which is more than 10 times our estimate of Greatland’s share of capital costs for Havieron of US$33.9m. We therefore expect in the future any acquisition of Greatland’s share in Havieron to be on attractive terms for Greatland shareholders.’
SVD also up 10%
Artemis Resources flying on Huge GGP purchase on Friday after hours, up 20%
How can you expect to be taken seriously if you don’t understand what gilts are? Only the government can issue gilts. A lack of understanding of one of the principle instruments of the financial system does not inspire much confidence.
Good evening Spev.
RNS Number : 6963X
Greatland Gold PLC
01 September 2020
“The Company's new issued share capital comprises 3,793,940,416 ordinary shares.”
“The Company has the ability to issue a further 84,356,755 shares under its block listing facility”
If a sum raised from those shares are not enough to get us started, I would be okay with adding another 100-200 million shares and bring us up on 4 – 4.1 Billion shares in circulation.
That would not be a huge dilution for me.
Alternatively, we can go to the banks or issue gilts.
But we have quite a few tenements.
Some have gold close to surface.
Let the BOD decide which asset would generate us cash the quickest and cheapest.
Firetower for instance:
Best initial results include:
• 54.5m at 1.36g/t Au from surface (0m) (2019FTD001)
This is on Tasmania, so away from the heat of the Paterson region.
Just for the fun of it and because it is late and I can’t be bothered to research for the right equipment, take look at Alibaba.
There are bigger, better and more professional equipment out there, so don’t despair.
But we do not have to go for the state of the art machinery to begin with.
Lets just start to generate cash.
Then we can always improve from there on.
But I think the more likely scenario is, we will be selling an additional 5% of Havieron to Newcrest at fair market price.
That will solve all our problems.
My problem with a buyout is that we can not achieve the full value of our assets.
Having found some fantastic assets, and start mining them will give us full value for decades to come.
And I, for one, am tired of chasing the next fantastic company and burn my fingers because I got it wrong.
With gold I feel secure, there will always be a demand, there will always be a use for it.
For me, it just cannot get any safer.
And I will most likely receive a yearly dividend till the day I die.
All that is gone in a buyout.
Oops should have said today
Big up to the Leicester posse, It’s good to have representation from the midlands as I’m also from Leicester/Leics. Was beginning to think it was all southerners and northerners In here. Lol
Amazing to see how far this share has come and potential still to go.
GLA for tomorrow, let’s get 30p ticked off and out the way.
For me the one that got away Ashtead bought .07p sold 20p approx 20 years ago now £28.00 my 3k investment would today be £420k so GGP just imagine holders
We have hugely de-risked GGP. Any attempt at becoming a miner would introduce huge multiple risks.
In any event, I do not believe it will happen. Newcrest will either buy out Havieron, or GGP in its entirety. The big boys will not want an infant running around in their playground, and they certainly will not want to share their sweets with us.
Next.! Could have been worse! My first share ( encouraged by my father was P.E.X .) Hard lessons are learnt well!
Leicestershire , not Leicester for me ! Most definitely a country mouse !
Let’s become a mining company but we would have to do a deal with a mining contractor, let’s say 55/45, 55% for GGP. We could use the toll processing plant at Telpher.
SocialistB- nice article but I fear it’s just wishful thinking . For GGP to mine ourselves where do get the money ? We don’t earn any money atm. Maybe raise equity and dilute shareholders? No thanks , a buy out would do just fine
I’m also from Leicester & remember telling my dad & uncle to look at next it was about 1986 & I was only 16, so what would I know ...... I’m in here and PUR now
Great post @SocialistB
A good example of legacy is Next Retail. I live in Leics and they are one of the counties biggest employers and have lots of local PI's who invested in the 80's when George Davies bought Grattans and formed Next Directory. When he was sacked the share price was 7p, some 27 years later it peaked at the princely sum of £80.00 per share, paying quarterly dividends.
Next are credited with creating around 900 local millionaires, but most investors cashed out well before that stage, only to regret it later. It's the topic of many a local pub how, if they'd stayed the course, "we'd be multi-millionaire's".
I get the feeling that many people in the future might well be having similar conversations about GGP.
Stay long and strong peeps, and good luck tomorrow (not that we need it)...
Interesting read SocialistB. This is what I would favour (dreaming of) obviously a long way off currently and reliant on a lot of positive results... Here's to hoping
Missing part from part 1
So if we have assets that can be mined for 30 years, and maybe even 100, if we take a slow approach, then you reach an astronomical sum.
Problem is neither Newcrest nor any of the other big miners can afford to pay such a sum and nor should they, there has to be a healthy profit in it, for their business as well.
Which is why, I always land back at the same conclusion.
We have to become miners ourself, to truly realise the value of what Greatland Gold has discovered in the Paterson region.
And is it, that impossible, to become miners ourself?
No, others have done it before.
Do you need to have hundreds of millions to buy equipment for, before you get started?
Newcrest has subcontractors to undertake a lot of the work at Telfer. These subcontractors provide all the trucks, diggers and so forth.
By the sound of it, Newcrest did not even have an in house engineer to develop Havieron, some members on this board pointed to an advertisement from Newcrest a few month’s ago.
So if Newcrest can hire an engineer to develop Havieron and subcontractors to do the manual work, then so can Greatland Gold.
But yes, we will have to hire significantly more people.
There really is no upside to being an explorer only.
Greatland Gold was founded in 2005 and listed on AIM in 2006.
Callum Baxter was one of the founding fathers.
August 14th 2006 Greatland Gold announces it has commenced exploration activities at the Firetower and Warrentinna projects.
This includes diamond drilling at Firetower.
They were still doing Diamond drilling in 2019 at Firetower.
So 14 years on, the prospect has not been turned into a mine, nor has it been sold.
Exploring is not so fun, nor is it easy. And it only cost money and is not generating any.
No, we are much better of becoming a miner and keep on exploring. No more JV’s then absolutely necessary.
BHP has been around since August 1885. That's 135 years.
We have all the assets to mirror that time line.
I would love, for my great great something in 2140 to still benefit from a wise investment decision I made some 122 years earlier.
In the end, we can only be taken over by a major, if we the shareholders decide to sell.
In the past, others on this board have said they would sell at 50p, 80p etc.
As it stands, I am hopeful that some of our other assets have the potential to mirror Havieron and we own them 100%
Until they have been drilled and proven to be dusters, I remain hopeful.
And that means, I would consider selling shares for less then £3 as selling them way to cheap.
And when our assets have been proven up, ie nor are they dusters or only 20.000 ounces per year mines, then the sky truly is the limit, and Greatland Gold will still be in existence 135 years from it’s inception.
And we have a change to be part of it, not from day one, but from the time it kicked off.
Nothing as beautiful as timing.
Bellers and Lenz, thanks for your reply.
And here follows the 2 part novel.
What would Newcrest think, with a competitor right next door?
Well not the usual line of fear and unrest.
A shop on the main street, that relays on footfall, will fear when a competitor opens up next door.
It could very well have a negative impact on their turnover. (except for those cases where it turns out to have the opposite effect)
Whether Greatland Gold, mines gold next door or a thousand miles away, it will not have a negative effect on Newcrest’s turnover. (unless we produce so much gold, it will effect the world price)
But they must be kicking themselves, they owned some of these assets in the past, even drilled them and found gold.
But gave them up.
I know, how I would be feeling. The same way, as I do, when I have sold a share too early and it takes off a few month’s later.
Kicking myself. Green, yellow and blue.
Luckily for Newcrest, they got 70% of Havieron for free.
The $65 million is money they would have had to spend on proving up the asset anyway, had they kept the tenement all these years.
They cannot defend going through 400 meters of cover, unless it is a viable business.
But it have been worth it, for Greatland Gold, to give away that huge percentage, look at where our share price is now.
I accept, it would not have happened, had we not got a major involved.
But I am truly sad, it ended up costing us such a huge percentage.
However, I hope it is very much, a one off. I would not like to see us, be taken advantage of, once again.
Our BOD has been very smart, the anomaly at Scallywag is much bigger then at Havieron and is only under 50-100 meters or so of cover.
If, we are so lucky that Scallywag are bigger MRE wise, then Havieron, then they gave 70% away of the right asset to propel us to stardom.
If we do not dare to dream big and grasp the possibilities that lies right in front of us, then we are doomed to fail.
And there would be nothing more pathetic then to fail from where we are right now.
We got all the right cards on our hands.
Gold in the ground. (and possible in the ****loads of ounces)
And not just one place, neither nor two, no we have it, in many many places.
Would Newcrest be smart to buy us out?
YES so absolutely.
Should we, the shareholders just hand over Greatland Gold for 1/100 of what we are worth?
NO, absolutely not.
What are we worth?
That is impossible to say, IT REALLY IS, IMPOSSIBLE TO SAY.
Even if we spent $400 million on proving up the other assets, we could not get an accurate picture.
I don’t think anyone expected Telfer to be operational for as long as it has been, back in the day when they decided to build the mine.
So if we have assets that can be mined for 30 years, and maybe even 100, if we take a slow approach, then you rea
Honestly no idea but if I was to hazard a guess I'd say based on the way the mining industry historically works it's likely Greatland would be taken over. Usually the big majors hoover up junior companies and maintain their monopoly. The successful junior's seem to end up that way, the unsuccessful ones change name a bunch of times or liquidate
Exciting times, it's going to be interesting to see how it all develops. JV seems the sensible way to go... Not sure about giving away such hefty splits on other areas if they come through.
SocialistB ..can’t see GGP becoming a miner, but I can’t see NCM buying out GGP in total either, the ideal I think for both companies is that GGP becomes an unofficial exploration arm of NCM, where more JV’s like Haverion could be formed, even if GGP continued to keep 25% of any mines .. that would turn GGP into a multi billion company, that guarantees a yearly income in the hundreds of millions! the bonus for NCM is they have experienced explorers finding the gold and it doesn’t cost them a fortune for. 75% share of any finds. For GGP they get to do what they are good at with a 25% share of any mines that are developed. That to me is a win win for both companies !
SocialistB, I ‘m not sure what NEwcrest would think about that. Probably ok having GGP explore and take what they find, but having competition in really close proximity possibly holding more underground than they have may not be what they want. If it was me I would snatch them now and remove the possible competition before it starts. Obviously take what they have first and then snuff them out.:-). Bit tongue in cheek but billion pound businesses didn’t get to be that by being “nice”.
Thanks for starting a meaningful discussion.
Taking a very conservative stance and assuming that all the other assets, that we own in the Paterson region, only will yield a quarter of Havieron each and one of them.
I would like to see us as a fully fledged miner, as that, is were the true value lies.
I could also settle for a merger with Newcrest, if our assets proves to match up with what Newcrest already own.
What I so absolutely do not want to see, is Greatland Gold selling all the assets and continue as an explorer alone.
Greatland Gold started out in 2005 and for the next 15 years, it had a very boring existence, at least share price wise.
It had assets, pretty much from the get go, but managed to do nothing or at least very little with them.
With the funds we now have access to, we can truly evolve. A thing most exploration companies can only dream off.
This article gives food for thought, I cannot see that rise from our current share price, but there is still plenty of leg room ahead.
5 years from now, if we are still a single standing company, have proved up some of our other assets, and the gold price has not collapsed, we will deal our shares in pounds and not pennies.
And we will have enough resources in the ground to keep us going for 100 years, enough to take even the youngest of us through retirement and leave something behind for relatives.