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Do we really think it’s possible to achieve price £2.75-£4
REALY ?? .. REALY !!
@justfencing Anglo had it valued on their books at $1.2bn/£860m unimpaired (£232m @ 27%) which is around £1.50 per share.
At 49% it's £421.4m (£2.75 a share).
The $80/t net profit figures assume a very strong iron ore price throughout, halving those values may be a better indication long term but in reality nobody knows the future ore price so it's just a guess in any case.
Inverting your question, can you state why it's not possible (assuming the 27% is accomplished)?
EV - thank you for your reply ( mike will thank you too probably ;@) at some point LOL.
I hope you are right -
The Agreement with Indo Sino is to invest in and acquire up to a 27% of a joint venture company Pedra Branca Alliance Pte. Ltd. (“JV Co”). On approval of the Judicial Review Process (“JRP”) and the transfer of equity of Amapá to the JV Co the JV Co will own 99.9% of the Amapá Project. Should Indo Sino seek further investors or an investment in the JV Co the agreement also provides Cadence with a first right of refusal to increase its stake to 49% in the JV Co.
do you think we will see the 49% - not sure how this would work - do we know when this may happen ???
and obviously this doesn't take into account our interest in the rest of the portfolio I presume - does anyone have any idea what this equates to??
or am I just getting way too far ahead of myself.
so yes this REALY REALY could happen and more??
Bacanora Minerals
Ownership (01/01/2021) : 30% Joint Venture
Macarthur Minerals Ltd
Ownership: Approx. – 1% interest (01/01/2021)
European Metals Holdings (EMH.L)
Ownership: Approx. – 9.9% interest (01/06/2021)
Hastings Technology Metals
Ownership: 30% interest
Lithium Technologies & Lithium Supplies
Ownership : Currently 24% earn-in upto 100%
Were Gonna Need a BIGGER BOAT GUYS !!!
Amapa 49% - Yes I personally see this as a strong possibility because Indo won't want to put a penny in to the project IMO so will sell their share down to raise capital to effectively give them a free carry.
Sonora - Our JV had an NPV of $30m based on 8% of mine plan - Ganfeng plan to increase production so this could be worth multiple of that $30m in time.
Macarthur - don't think this will be hugely significant for us at 1% maybe £2m-£5m in best case
EMH currently £15m but can easily double or more from where it is as they plan to double production (might be bought out by an Auto OEM like VW)
Hastings Technology Metals - Unknown but my guess is perhaps in the £5m-£15m range.
Lithium Technologies & Lithium Supplies again perhaps £2m-£5m could be a lot more in a future best case scenario
indo are putting their 1.71mt stockpiles into the project at dipb… at the present av net profit were shipping the stockpiles at… that’s…
$9,216,063 / 143,547t = $64.20/t net profit…
1.71mt x $64.20 = ~$110m…
Many thanks EV - so this could place the SP into many multiples of todays - any thoughts of what this could look like in a couple more years - seems mind boggling to me a least - any guesstimates ?
thanks in advance to anyone who would like a stab at it X
I don't think the thread title is too far off from being possible if we got to 49%.
Broadly £2+ is realistic within 2-3 years £5 is the top end if all things go to plan within 5 years. (Hastings, Sonora, EMH and Amapa in full production)
LoL @EV. There's a thread from earlier in the year titled £5-£10 which begs to differ ;-)
For me the 49% question is only relevant IF & only IF it is offered, there is no guarantee or requirement that it will be & it is entirely at Indo's discretion/need/desire......
So if it is offered & the rewards/indicators/PFS warrant further investment we should take it by whatever means necessary, whether by sale of assets, capital raise or both..... if it is offered & we didn't take it it would be a huge indicator in my opinion that the project has some significant questions to answer over its viability/potential to be addressed .... don't forget if it's offered & we don't take it up Indo have the option (but not a requirement) to repurchase our 27% for US$9M ... so there needs to be a good reason not to go to 49% IF we are provided with the opportunity.
Bannor - if it turns out to be successful why would they want to offer it to us and not just keep not for themselves?
"because Indo won't want to put a penny in to the project IMO so will sell their share down to raise capital to effectively give them a free carry."
@Bannor, as far as i'm concerned the project is already proven as viable by the fact it is a previously operating mine and looking at the Anglo American profits. The biggest unknown is future Iron ore and shipping costs.
Worth mentioning that the 65% ore resource we have attracts a good premium so can be expected to be in high demand.
April 06, 2021 :
https://www.metalbulletin.com/Article/3982714/FOCUS-5-reasons-behind-historic-62-65-Fe-iron-ore-price-spread.html
FOCUS: 5 reasons behind historic 62-65% Fe iron ore price spread
"The price spread between 62% Fe and 65% Fe iron ore fines reached a historical high in March as a result of various factors, according to market sources.
Fastmarkets’ index for iron ore 62% Fe fines, cfr Qingdao was at $159.85 per tonne on Thursday March 25 while that for iron ore 65% Fe Brazil-origin fines, cfr Qingdao was at $190.40 per tonne.
The spread between the two indices rose to a historical high of $30.55 per tonne that day.
Here are five factors that market sources cited for this development.
1. China’s steel production curbs
China’s Ministry of Industry & Information Technology (MIIT) announced its draft masterplan of policies for the ferrous sector in its 14th Five-Year Plan on December 31 last year, which placed emphasis on keeping emission levels low.
Part of the strategy for reducing emissions involve crude steel production cuts in 2021, which prompted a bearish outlook for iron ore.
Prices for the mid- and low-grade iron ore were directly affected because of sintering restrictions"
I was hoping subsequent the issue of their 29p options the BoD would reveal more details about various aspects of the contract with Indo, specifically the details around the 49%. Perhaps they are waiting until we have taken 20%?
EV & JF ... exactly that to both comments .... why would Indo offer it if they don't have to & why would we not take it if they do.
don’t forget the default clauses that allow us to receive cash and / or shares up to 49.9% in pba… should indo default on their investment… i.e. their 1.71mt stockpiles… more likely to happen at the recent high ore prices…
So .. hopefully we will get over this 30 pence ceiling very soon .. I’d have thought we would be drifting up as news is imminent- but we appear to be in a state of limbo do we not.
@tomcat, you seem of the opinion that there is 1.71Mt of additional ore sat around somewhere. I'm tending towards the view that this is a virtual claim they have, which they will waive as part of the DIP financing, assigning their $49m associated with this to the JV - as we have previously discussed: no new money, just a transfer of debt. Got evidence that there is an additional 1.71Mt? And if so, where is it? And why haven't the BoD told us...? Sigh. LoL. ;-)
jrp 1.1.30… and the 3mt stockpiles anglo pacific reported…
"1.1.30. "Indo Sino Credit": is the credit held by Indo Sino against the Debtor, in the amount of USD 49,140,000.00, currently indicated in the List of Creditors in the Class of Unsecured Creditors, but subject to an appeal to consider the pledge guarantee of 1,718,338 tons of iron ore.".
I'm interested in how others read that, but to my eyes it says that Indo have previously paid DEV $49m so this is how much DEV owe Indo. However, Indo would rather have the $49m denoted as 1.72Mt of ore owed instead, and of course they would as that is much more valuable now given the shift in exchange rates and iron ore prices. This doesn't mean there is 1.72Mt of ore mined and ready to rail/ship though. But it may do.
This is Indo's appeal:
https://www.jusbrasil.com.br/processos/108114731/processo-n-0015967-2320168260100-do-tjsp
Might get more information by viewing it here:
https://esaj.tjsp.jus.br/cpopg/open.do
Looks like the JRP may have a typo and it's actually $49,940,000.00
This one's interesting too: 0015950-84.2016.8.26.0100
@tomcat: "It turns out that the iron ore in question could not even have been given as a guarantee, by reason of pledge and fiduciary sale in guarantee previously constituted on the same assets, for the benefit of third parties. "
Bottom of page 13 of the JRP:
https://administracaojudicial.kpmg.com.br/downloads/planos_de_recuperacao/PRJ%20Homologado%20em%2029.08.2019-1587574667016.pdf
===[
As a result, the iron ore storage areas at the mine, the rail yard and the port terminal reached their maximum load and, consequently, it was not possible to continue producing iron ore after April 2014
]===
I think it's high time we were told these maximum loads and who has claim over them.
Bottom of page 15:
https://administracaojudicial.kpmg.com.br/downloads/planos_de_recuperacao/PRJ%20Homologado%20em%2029.08.2019-1587574667016.pdf
===[
To discuss and introduce possibilities with strategic partners to invest in value addition, such as pig iron, pellets or steel in the state of Amapa.
]===
:-)))
@observer I think I found it before that the max capacity was around 5mt at the private port, then they continued stockpiling at the mine.