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@wasred, sorry, for my sins I spent too much time over there and it sneaks in occasionally.
Err 'licence' not 'license' unless you are from across the pond; when a noun. Not being pedantic merely a modest attempt to retain English as English not bow to any americanisation of our language. Stay Safe.
Er, "license" not "lease"
Hi, Bamps, you're right, I read it wrong. The lease is for Hav only.
Not sure why we had to play the legal game with Scal ownership, but it's pretty obvious it was for purposes of the mining lease application. Maybe because it's all in the same tenement? Don't know, probably doesn't matter much why, those in the know did what they needed to do.
Bear is a four leggeit thing!
I would love to see Newmont come back to look at Ernest Giles as well as Newcrest mining Hav.
GGP will never become a miner - the main directors GH and CB are too old for all that sh@te ...this is their pension pot and a very nice one at that...IMO I think they will stick to their current strategy of making loads of money - minimum risk and maximum return for themselves and therefore their shareholders. ALB
Hi SB
I'm not so sure that Ggp will ever get to be a producer.
My Gran used to say tosucceed in life stick to what you know.
Ggp are excelling in exploration I would imagine the Majors know that.
Ggp are not miners and the costs are huge. The waste management is huge.
I for one would be quite happy with another jv with NCM and the sp rising another 300%
Bramps21
You have some very good points about London, Blackbeard, Blackhill South, Barbossa and Kraken.
It would take years and cost a fortune to prove them up to their full value, if that is even possible.
For that reason, I would favor either one of the 2 following routes.
1. Greatland Gold get revenue from from our 25% stake in Havieron and uses that to transform from a pure explorer to become a miner our self.
With the assets we got, we will not have to fear running dry of prospects for the next 100 years if they prove to be as good as Havieron.
This way the true value of our asset would remain in the company. For decades to come.
2. Follow in the footsteps of PUR (Pure Gold) to some degree. Prove beyond doubt that there is an enormous amount of gold present on the tenements.
If we can come up with a conservative guesstimate, that prove we are sitting on more resources then NCM, then we should try and go for a MERGER.
This way would be much faster and we would all get a good price here and now. And still retain a part of the asset.
BTW, another important factor that makes GGP an intelligent investment:
:The Australian Gold Ore Mining industry produced 335 tonnes of gold in 2019-20, and is anticipated to become the largest global producer of gold in 2021." DYOR
Agreed....ffs they built their one airport and town lol
I was told 2billion for Telfer, but I suspect that was Aussie. It’s pretty big!
Dave, that read just so sweet and succinct. I might even print it off and stick it on the fridge.
Earlier Tom E put this link up:
https://greatlandgold.com/paterson/
It is truly mind boggling.
If the initial drill at Scallywag is proven to contain valuable ore then that may indicate a higher degree of confidence in GGP's methodology in choosing drilling locations and that would really pique the interest of NCM and indeed others as it may suggest GGP's other Paterson prospects also may prove prospective. A hit at Scallywag I believe may trigger a bunfight for GGP
The shareholder investment decision in my opinion is quite simple......The current S/P is @ 13.80pence today to buy(2/8/20).....the current value of Havieron (un-risked and without further drilling results) is approx minimum 25-30p - so with approx 60,000m of further drilling still to be done by Newcrest (as per their farm in agreement commitments) and taking into account the current mineralisation diagrams available this is expected to grow possible to 60p-90p.
Then of course investors need to take into account what else will be found in the GGP other tenements (Scally etc) - these other tenements are amongst the most lucrative in the Patterson region and are expected to disclose other large deposits - without ramping the S/P could easily exceed £1 ......and IMO im being very conservative ...Time will tell but thats why I'm holding and willing to go to the end game ...I think the BoD's are in the same camp. ALB
Hi TmT
On your post about the Mining Lease, the lease is not for the whole of E45/4701 it's just for Havieron. As far as i'm aware they need to provide details of mining methods , environmental issues, waste management + other issues. I doubt whether any of these will apply to Scallywag.
My initial comment about NCM owning the 40% and making an offer for it was only in the context of the heading "a bit of fun" but it turned into some sort of critical debate so on the more serious side of it here's my view.
Ggp as a small exploration company would have taken years and years and years to prove up the Havieron asset with huge amount of dilution and debt.
Ggp only drilled 6 holes from memory and NCM were hooked by the findings and are on course for spending $65m in less than 2 years making Ggp Market Cap multi millions in that time with no outlay apart from giving up 70% of Havieron.
Without NCM Ggp wouldn't have got very far to be honest in those 2 years.
Now look at Scallywag 5 big targets London, Blackbeard, Blackhill South, Barbossa and the best Kraken anyone of these could match Havieron or get near to it.
If Ggp have to get debt for mining operations there will not be the amount of cash available for all these targets + any other license work. 5 targets at Scallywag you could be looking $200-300m for drilling exploration.
My tongue in cheek remark about NCM making an offer for Scallywag before relinquishing them back to Ggp for me is a serious option.
NCM could offer to pay our mining costs plus the 9 rigs at Havieron could eventually move on to Scallywag with similar free ride to mining for Ggp.
Ggp would be on course for 25% of a vast mining area.
For those that don't see that just have a read of the surveys and sampling results which are similar to Havieron.
Scallywag is not the spratt to catch a mackerel a target on Blackhill North Saddlereef anamoly has been extended to 1400m.
There's a whale out there somewhere, Goliath maybe or the 200 sq kilometre of Cobalt on Panorama or maybe 2 whales :))
The current Havieron deal is a good deal because both parties were happy but as already said Newcrest didn't start getting really interested until over 8-10 holes had been drilled @ GGP's expense and when Had66 showed such high mineralisation Newcrest were all over it....a measured risk by Newcrest and as already said due to the location of Telfer a good deal for GGP (On yer bike Newmont)......I think with all the activity in WA especially the Patterson region - Newcrest will be happy to co-exist with GGP without any hostile or cheap takeover deals - this in my opinion is a perfect partnership - it's as simple as that! ALB
To construct a plant like Telfer is around 500million I read somewhere (unsure which currency but I’ll assume USD). GGP cannot afford that financially nor the time required to build. That is why SolGold is having issues, the CAPEX alone is immense for their project. SXX was mentioned here last week, I was not a shareholder but it couldn’t get the finance to build the plant apparently. Can you see a theme here yet!?! Be thankful NCM want to do deals with us on very reasonable terms. I’ll repeat that the share price would be under 2pence without NCM in the frame. 700% increase in 6 months yet people think if NCM ask for more than 50% that we are being hard done by. I’m glad you’re not in the boardroom negotiating on our behalf.
Bear in mind that Newcrest wasn't the only offer on the table for HAV. What swung it was, I believe, the existing infrastructure sitting next door. This is a massive advantage in terms of any future capital outlay. So yes, I think Newcrest got a good deal, but I also think we got a great deal as well.
As for Scally, I can't see us turning it into a swiss cheese before the next JV. Bearing in mind the consensus seems to be that its bigger than Hav, how long would that take? Three years plus? Without the resources of a major behind us?
For me its about drilling some holes, hopefully finding something that someone wants and straight to a JV before moving on to the next target. Repeat ad infinitum.
I would hate us to end up in a position like SOLG - plenty of juicy targets but it must be 3 years of drilling Cascabel so far and still not at BFS stage. Its done the share price no favours either.
Happy to stick with what we do best
At Hav, there was no proven asset. NCM was putting in 65 million for possibly nothing. It made sense that they would get a large percentage for that risk.
Also at Hav, we didn't even have the money to prove it up, let alone mine it. So we needed someone, and we paid for that.
At Scal, hopefully, it will be a proven resource. That takes the risk out of it for the other partner (NCM or someone else.) Also, in these scenarios, we'll have more resources and could potentially mine it or find another JV partner. We will not be in a position of weakness.
In RA's scenario, I would expect the % to be closer to 50/50, with the partner doing the mining and bearing the costs. We aren't just going to hand someone 50% of the asset just because they know more about mining. We can hire knowledgeable people if we need to, we'd have the resources. I'd be surprised if we could get to SocialistB's 70/30 breakdown but it certainly won't be the same as Hav. A proved up asset is worth a lot more than a speculative one, and we'd be providing a proved up one.
The BOD of GGP have without a doubt made a good deal with NCM when you compare our situation to the likes of Antipa, Solgold and Artemis for that matter.
But that does not mean that we can not get a better deal next time around.
If it's true that all negotiations starts from a position of strength, then we are in a much better place with Scallywag then we were in with Havieron.
If NCM bases their business decisions on vanity, then I am sure they might not get out of bed for a "paltry" 30%.
But if they base their decisions on fundamentals, then they will, as long as the asset is big enough.
30% of multi many BILLIONS is most indeed worth getting out of bed for.
There is absolutely no reason for our BOD to aim for a deal based on the same terms for Scallywag as they had to accept for Havieron, and I doubt that they will.
Nice as NCM may be, they do through their weight around when negotiating, look at the deal Antipa got, far less favorable then what GGP got.
But I am sure our BOD also felt NCM's might during the negotiations about Havieron, otherwise they would not have handed over that huge percentage.
Regarding Scallywag, we will be in much stronger financial position, we will be able to prove up more of that resource with our own money and that places the shoe on the other foot.
And we should take advantage of that, and retain a much higher percentage this time around.
And for me, there is poetry to a reversed 70/30 split.
However I doubt it all matters.
All we have to do is prove up our assets, that they are highly likely to be worth multi many many Billions.
The day we can claim and prove without the shadow of doubt, that our assets are worth more then what Newcrest already owns, we can go for a merger.
At the AGM in 2019, Gervaise said that he doubted GGP would be a stand alone company in just a few years time.
So prove up our assets and aim for a merger with NCM, that's how I would like it to unfold long term.
RA, I'm going to take your assumptions and add another one -- that by the time your scenario plays out, we've had sufficient drilling results at Scallywag to assure us we have an economically viable Au-Cu or Cu resource.
Under that scenario, my preference would be to negotiate a deal with NCM where they take on the full costs of mining Hav, and we retain a large royalty percentage. They are in control, they mine it, they just send us loads of lovely money every year. We don't become miners, but we retain a royalty in Hav. This should give us more than enough to run a major drilling campaign, and also start to generate some dividends (maybe 1-2p / year).
We turn Scal into a pin-cushion and fully prove up the resource, and do a deal with NCM, Rio, or some other major. They come in and mine it (that's what they do, not what we do). But because it's already proved up, the royalty percentage on this one should be much, much bigger. Loads of money to go drill the next target -- and, to pay bigger dividends.
This won't be the buyout scenario that some shareholders want, but it certainly would push the SP very, very high, and those who want to cash in could.
Tons of possible permutations, but that seems to me the best plan for long term value -- retain a share of the things we find but let the mining companies do the actual mining. This is, however, a relatively uninformed opinion, I am no expert on mining.
Regardless of the specifics an annual income stream is great business sense... no debt needed and no capital raisings.
@MH01, the JV is unlikely to leave all the CAPEX and Opex to the senior partner. It will leave 25% of it to the junior partner unless we sell an additional percentage to NCM.
We can pay 25% of such costs and receive 25% of proceeds. Or, perhaps we could agree that NCM bears all such costs and we only receive X% (15? 20?) of proceeds. But we certainly won't receive 25% without bearing our share of costs.
TmT - Good point and well made. All relies on the original assumption of £2Bn and that NCM decide to take the 5% option. Even if not, I suspect that you're second point applies, ie we should be in a much better position to secure debt financing.
ATB
RA