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So this is the change in a balance sheet value of USD 162,729,194 at 31 Dec 2022. The increase is $ 2,589,279 or about 1.6%.
The currency of Republic of Congo is the Central African Franc (which is the currency of 6 African States). Value in Dec 2022 about 611 to the dollar and June 2023 about 599 to the dollar (about a 2% appreciation).
‘expenditure increased by USD 2,589,279 as a result of the weakening of the USD against the currency of the RoC.’
I think there are some errors in that statement. USD doesn’t appear to have weakened against the Congolese Franc, and certainly not by USD 2.5M. Any accountants out there?
The rest of the update is vanilla.
Compared with previous years, at least now we have a clear timeline with SEPCO.
SEPCO has committed to a work schedule that provides for:
- Site visits during the months of August 2023 and September 2023. (WE ARE HERE)
- Completion of all of the engineering design works before end December 2023.
- EPC Contract offer to be made to the Company during January 2024.
what would you willing to pay once EPC offered? OR how much you think the share price will be then?
Check out number 4. on the Power China site:-
https://en.powerchina.cn/2022-10/10/c_818331.htm
Quite! At least we're all looking upwards!
WTFDHK !
2.5p is a lot less than I was hoping for but ALB1 may well be correct! I was hoping for 10p but WTFDIK?
Cash Investor - Kola Financing Process:
The Summit Consortium (SEPCO and Summit) will provide (debt and royalty) financing for the FULL CONSTRUCTION COST:
See RNS 31/3/23 :-
"On 6 April 2021 Kore announced the signing of a Memorandum of Understanding ("MoU") with the Summit consortium for the financing of Kola, which required completion of an optimisation study on Kola and agreement on terms for an EPC contract. Kore continues to work with the Summit consortium to provide financing for the full construction cost of Kola which is intended to be based on royalty and debt-finance."
Also as disclused on the website: The Company is subject to the rules of the UK City Code on Takeovers and Mergers
Cash Investor, my bet is either OIA and SQM or both will take all, however at a lower figure than most believe. IMO 2.5p max ps which in cash terms with their combined holdings =£50m. Any other interested parties (and in any event I don't believe there would be anyone else with $1.8b to throw at this) don't / wouldn't have a look in due to the share structure.
Ultimately it's what the BOD would accept if such a case arises, but they have no real bargaining power here.
Talking about the future, very soon OIA and SQM will confirm whether they inject new fund into KP2. the 21 days deadline coming up.
the only thing going for KP2 vs many other potash explorers is OIA and SQM, who both having deep pocket and can fund the 1.8B. and they have not sold any share yet. instead keeping injecting new fund year after year.
Both scenarios have to be approved by majority and at fair price. no one can say "I offer 0.6p for all KP2 shares" and it is over. cause another party (who may own no KP2 right now) can come in and offer a higher price.
Imo this mine will happen one day... However I don't see a future for a standalone kp2 listing. Once upon a time many years ago this SP would be sitting at a major valuation, probs x 5 current SP at minimum. Those days are well gone though, and the current MC put on this tells you this! . So what's the future hold here -
1. The main funders take over Kp2 ( very likely as they already own a big slice and why plough in $1.8b not to own outright)
2. Delist and go private sharing the spoils of any future profits (very possible as the listing currently provides no advantages)
One or the other for me.
I would suggest that both parties (Kore and SEPCO / Power China) are working on the assumption that the EPC signing will happen.
SEPCO / Power China have commited to spend $5 million, that will not be recovered unless the EPC is signed.
Kore were keen to raise and pay the $ 1 million promptly.
It is also worth noting that the Kola optimisation study (announced 6/4/2021) was estimated at $ 1.8 million. The new study will cost $10 million. Draw your own conclusions, but IMHO this as very positive and implies some further savings in construction time and costs may be achieved.
Thanks. So it looks likely, dispite everything, the EPC will be signed and at least give clarity on where were going.
Kanga are looking to launch their own project (e.g. float the company or enter a joint venture). I suspect that this maybe when the Kore EPC is signed and the Kanga project starts etc. etc.
What does that mean for Kore Potash (if anything)?.
News from the neighbours: Kanga Potash and Republic of Congo sign 25-yr mining convention.
https://www.globalminingreview.com/mining/31082023/kanga-potash-and-republic-of-congo-sign-25-yr-mining-convention/
We are in the realms of guess work regards the payment terms, but best to assume another raise of a similar quantum. Already, very generous with SEPCO / Power China paying for $5 million or more. Very easy terms for the balance with part due after the EPC. I'm assuming the second payment might be as much as $1.5 million ( as in $2.5 million before and $2.5 million after the EPC).
99 - agree with all your post except for one detail.
from "20230808 Revised Agreement with SEPCO 6A1162477_KP2", there is this part
"Any participation by OIA and SQM would be in addition to funds raised via the Fundraise and
announced here"
so the $1M USD already paid. and the $1.5M extra (about $1.9M USD) can be used to pay for the 25th Oct payment?
The EPC Contract offer is due in January 2024, with signing scheduled by the end of January 2024. So the 25 October payment will come before "the final plan and guarantee". On 21 September we have a general meeting to approve share issues to "connected persons".
Before 25 October there should be a second round of fund raising for the 25 October payment.
The value of Kore shares will depend on the new costings for construction and extraction that will come from the new design and engineering work currently being undertaken. After the EPC signing, Kore's brokers (SP Angel and Shore Capital) and others (e.g. Canaccord) will no doubt issue new "Research" on the company together with new valuations. The degree of cost saving achieved and the broker valuations should move the share price substantially (re-rate).
SQM and QIA new inject fund would reduce the amount to be raised. KP2 cash run out in Dec23 so 100% another raise required.
yet on 25 Oct when SEPCO provide the final plan + guarantee, the risk profile for KP2 will be different. people like ALB for example will join in the buy side.
so it would be interesting to see how both forces play out on the market.
Chinese President Xi pledges firm support to Republic of the Congo
https://african.business/2023/08/apo-newsfeed/chinese-president-xi-pledges-firm-support-to-republic-of-the-congo-for-national-independence
The "Revised Agreement with SEPCO - implies another fund raise before 25 October" of a similar size (i.e. the up th $5 million is paid in total of four payments).
"the remainder ......... is planned to be paid in three tranches between 25 October 2023 and 12 months from the date that the Company signs the EPC contract.
KP2 cash at Jun23 = 2.6M. each quarter spend 1.2M. so at end of Dec23 cash will run out.
This extra amount will cover the expense till end Mar24. right on time for the financial package.
Have found the General Meeting document that sets out how many shares have been offered to SQM and QIA. They have been offered sufficient shares to maintain their current per cent holdings (and no more) as follows:
...................Number............$ Approx..........%
ISSUE......155,480,000.......1,000,001.....64.9%
SQM..........37,662,890..........242,236.....15.7%
QIA .4..........6,317,394..........297,900.....19.3%
TOTAL.....239,460,284......1,540,137....100.0%