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Apologies, i got the wrong end of the stick. That's what comes from skim reading.
Sorry, people, please completely ignore the last two posts. I was typing out views on political risk for two different boards at the same time, Botswana for KAV, Tanzania for HE1. I completely c@cked up by cutting & pasting onto the wrong board. I'll go and lie down for a bit.
should have read "create much needed JOBS"
Hi Layla - It was Acacia Mining, not Nornickel. The late President John Magufuli demanded $190 Bn (!!!) in taxes from them, it was finally settled my major shareholder Barrick Gold for $300 M. This, and threatened changes to the mining code, put a lot of investors off, and pulled the rug from several mining companies. Magufuli (a Covid denier and all round eccentric megalomaniac) died earlier this year, and has been replaced by a very nice lady, US-educated Samia Suluhu Hassan.
She has made it very clear that there is a profound change of management in the country, and has repeatedly supported commodities investment. I am sure that she is the only president of any country to specifically mention helium in her inaugural address!
Tanzania is still viewed with deep suspicion by many investors, and I am sure this is, and will continue to be, a factor depressing our share price. I consider it a risk that the government may get greedy and grab the company and its assets, but a low risk. Quite simply, Tanzania has had a disastrous 5 years under Magufuli, and badly needs overseas investment to turn the economy round and create much-needed investment. Nationalising Helium-1 would immediately shut down any investment in the country - the president is well aware of the consequences, hence her efforts to encourage investment from outside.
Hi Layla,
Not sure what you mean. Norilsk Nickel does not operate in Botswana. They do have a mine in South Africa though.
They have had issues back home in Russia recently. A large diesel spill, and being forced by the government to stop putting sulphur dioxide in to the atmosphere. Perhaps that is what you were thinking of?
Interesting reading Keith. My one concern here is the dispute that arose between Nornickel and the government. Maybe this is why the s.p is where it is? The gov appear to have a history of pulling the sheet out from under investors.
I've put a nice lump in here, but I'm wary about going in too deep.
It's quite surprising that the world's largest Ni deposit is contained within such a small geographic area - 20 x 30 km. Below is the latest reliable detailed resource that I can find, obviously we don't yet know 1. if we have any economic deposits or 2. what their composition will be, but this might inspire some flights of fancy...
Combined Talnakh and Noril'sk ores
Proved + probable reserves - 338.986 Mt @ 1.33% Ni, 2.26% Cu, 5.38 g/t Pd, 1.42 g/t Pt, 0.28 g/t Au, 7.12 g/t 6PGM
Probable reserves - 22.306 Mt @ 0.28% Ni, 0.36% Cu, 4.28 g/t Pd, 1.75 g/t Pt, 0.20 g/t Au, 6.37 g/t 6PGM
Measured + indicated resources - 1380.499 Mt @ 0.57% Ni, 1.11% Cu, 3.07 g/t Pd, 0.87 g/t Pt, 0.19 g/t Au, 4.12 g/t 6PGM
Inferred resources - 462.709 Mt @ 0.89% Ni, 1.85% Cu, 4.40 g/t Pd, 1.12 g/t Pt, 0.26 g/t Au, 5.75 g/t 6PGM.
Reserves are what they are sure they have - the mine plan will be based on this. Resources are less exact - perhaps we could define measured resource as "we're pretty sure", indicated as "quite likely" and inferred as "we hope so". From what I can deduce (these clever Russians keep their cards pretty tight to their chests), the high NI & Cu content Proved Reserves are the discrete massive sulphide orebodies which are currently being mined by block caving at deep levels, 500 - 1500m. These orebodies have surprisingly high levels of PGMs, which contribute about half the value - have you looked at the Pd price lately? The less certain resources are largely disseminated sulphides which would be a lot more expensive to mine.
Judging by the high rates of accidents & injuries, and appalling pollution output, Noril'sk is being run on the cheap. But not as cheap as when they started out, using gulag labour - it's estimated that around 20,000 prisoners died in the mines. It is my ardent hope that should operations start after any discovery we might make, Botswana and its people share in the benefits, rather than it all going to a couple of couldn't-care-less oligarchs. Here endeth today's Lesson, taken from the Book of NorNickel :-)