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I would be less worried about SA than the Beeb! They have an agenda, and since most gold miners are still controlled by the evil white man, they tend to over egg the situation. Yes, power supply has been an issue, but they are working on it. Also, bear in mind that there is tons and tons of solar power potential there too!! Its going to be a long time before we need to power a gold mining/processing facility, at least 5 years I would say, and I am sure that the short term prospect, the Harmony JV have already addressed this!! Also, proving up resources in SA because of the nature of the deposits, (large, flat, concentrated), you do not need to do anywhere as much drilling to prove up a resource compared to other jurisdictions. Take a look at civil law in SA too, it is still ranked as the 3rd best jurisdiction in Africa to do business. There are good reasons for that. If it were such a bad place to do business, why are all the major gold miners still doing biz over there? And it looks like our concessions are shallow!! In other words, very cheap to mine!!
Looks like today, finally, the market is sitting up and taking notice. Decent volume today and some sound looking buying in good chunks going on.
I appreciate your caution but I would rather rely on the experience and expertise of Mark Creasy, Bernard Oliver and Ed Nealon than a couple of two bob journo's trying to write a story for the BBC !!
The deal looks good on paper, with a massive increase in potential reserves - but these are not 'official' JORC; I wonder when/if this will happen.
My worries about working in RSA continue though. Have a look at this article from the Beeb https://www.bbc.co.uk/news/world-africa-65671718
It's a country rich in resources yet extensive power cuts now seem to be becoming the norm. This is basic infrastructure provision and things have got so bad that "Turkish company, Karpowership, has signed deals for its ship-mounted power plants to supply electricity to several West African countries, and last week South Africa. These are moored off the coast and directly plugged into the national grid, supply between 30 MW and 470 MW per vessel." This is another quote from the Beeb.
I am staying with Lex as it looks as if it could be a multi-bagger over a period of years but RSA will be a very difficult place to do business.
It's a gift! get more stock! Creasy gonna be leading this to 100-300m market cap. LEX move was a cleanup operation and now a vehicle to extract maximum value. Deals with actual mining operators in place. Proven gold reserves that can easily be mined but what's really over looked is the other plots. 8p was fair value for the US plots with cash in the bank for a year's operations. I'm shocked we not at 25p+ already but actually look at the deal with Creasy its best for LEX holders if SP holds here until deal is completed. Creasy becomes a major shareholder and his experience will be a massive asset. I can wait for this to unfold and will aquire more and more shares as and when I can!
I think it is quite staggering that a Junior miner can come up with 37mn Oz of Gold and the market shrugs it off as if nothing has happened. Mark Creasy is no fool and has a great track record of rewarding shareholders who back his judgement, I for one will stay fully invested here and look forward to the future... I have batted on a bit suggesting one of the bigger players close by to us may want to acquire us at these levels and recent announcements surely makes us more attractive
Methinks that the community is getting hung up on stuff which is not really relevant!! Lots of people here seem to focus on why Creasy is selling out. Well he is not. He is well known for investing in mining juniors in Australia in particular. Surely, the fact that he has got on board a group of managers who know and/or live in South Africa, should count for something? He retains between 30 an 40% of the business potentially. Loads of incentive to support existing management. And there is low hanging fruit there for us.... The Jelani Joint venture with Harmony. Technically, they will be waiting for AGM approval, but I think you can bet your bottom dollar, the phones will be ringing already to get this one back on track. Management would not risk approval of the deal by an AGM/EGM being rejected if they had not already had a quiet chat post deal announcement with the major shareholders and got their approval...
We need to relax, and look forward to the slow realisation that this is going to be a 37,000,000 ounce company, not a 200K ounce one, and let management get on with it!!! The potential is there...
Is it because he/WRE acquired the land/claims/licences proved them up to pre development, now selling them to LEX for a profit, retaining a 10% interest via LEX shares, so still benefits but does not have to spend anything on development/mining costs in future ?
A VERY in-depth interview with #LEX CEO Bernard Olivier.
“…This takes us from a junior explorer into a far, far larger company with potentially multi million ounces in the ground….”
https://total-market-solutions.com/2023/05/lexington-gold-ltd-may-2023/
Agreed, However, you can't ever keep everyone happy, but I thought the bit about the depths of the prospects at 2-400m is very telling. You don't even need to put shafts in at those depths, you can spiral down and put a basic rail transport system in as I understand it. MUCH cheaper........... I am sure that we will hear more about this as things develop. But really, it seems to me that it is the absolute massive size of what we seem to be getting into that is fascinating, not to mention game changing. Going from 0.22mn Oz to potentially 37mn, is pretty bloody amazing.
Not sure why my link below was removed but check out Vox markets interview with Bernard Oliver if one so inclined.
Most reservations I've heard put to bed by the man himself.
[LINK REMOVED]
I hear you SJH. If you look at the trades yesterday, most of them were what I would call "junk trades", there was really no evidence at all of concerted selling by major holders. Just 1 X 200k, 1 X 150k and 1X 100k, on a volume of 2.8mn which is less than 1% of the company. This share is still very tightly held.
Someone was also questioning why WRE was put through business re-organisation. I have n idea about that as someone who has been through this process before,. If you are a sensible business person, its a very neat solution to quite a few things and cleans up very potentially messy situations. 1) Creasy, as the major creditor would always be in control of the process, but much more importantly re-organisation would achieve, 2) getting rid of all old debts to suppliers (if any) and 3) would ensure a sale of up to 100% of the company totally wiped clean of previous shareholders and potentially a useless Black Empowerment operator (and there are many of those in South Africa). This is great for Creasy, great for LEX. Clean clean clean!! The government sponsored process GUARANTEES a shiny new asset which has been totally laundered of any nasties. It will be interesting to know who LEX chose to become their BEE partner. There are actually some very good ones too.
Yup all those that needed to sell gone today, back to a shortage of available shares on the market now much the way its been for at least 9 months. We at 15m market cap with some of the most exciting gold prospects out there and Mark Creasy on board.. unbelievable really. I'd of thought this market cap was cheap for the US assets alone let alone WRE which has outstanding proven potential and holding exploration potential as well. With gold prices where they are and unlikely to see any major decline I'd be suprised if we didn't see a quick and substantial repricing to the upside.
Thought i would check all the trades today as I thought there were more buys than sells, yet we ended the day status quo against Friday. I backtracked all the delayed buys to the price at the time of the trade, and they were all fairly obvious if they were a buy or a sell. Results: Volume of 1,372,914 buys Versus 1,444,926 sells. A difference of 72,012 in favour of sells. So in other words, the MM's made a nice packet of dosh today trading 2.8m shares. lol
Hi there Panda, re your point about he Jelani JV with Harmony being too deep. That is not an issue, there is already a mine , 3 mineshafts in place with all the ventilation etc. Go to Harmony's annual report and look up the Target 1 mine I think it is. As to the others, the RNS states that the targets are between 300m and 1200m deep. Its the Jelani JV with Harmony that is deep, I am sure that the company will clarify the depth of the others sooner rather than later, but White Rivers was quite unabashed to say it was looking for shallow mines or mines with infrastructure already in place.
Someone else mentioned dilution, as I said earlier, if I am getting a 16,000 times potential uplift in reserves from what we have already, I don't really care if the dilution is 75%. I've still got more money in the bank. Worth also noting that there has been lots of drilling there already. If it can be proved that the old drilling is accurate by punching a few holes nearby that match the old results, you are allowed to use all the old results for JORC purposes. Therefore, it may be nowhere near as pricey as you think to get serious upside from here.
As to Creasey's motivation to sell, well I am not a mind reader, but he is getting on a bit, 78. and he still has a ton of stuff on his plate in Australia from what I can see. But really, perhaps we should be focusing on the fact that he still wants in, hence the option, which he is PAYING for.
Anyway, time will tell. It will all out in the end!! I am still massively excited by this and am looking forward to learning more.
What is the current cash position as the company will presumably need to spend a large amount on drilling and feasibility studies to prove up the licences?
Great to see the SP continuing upwards and this makes sense considering the potential increase in reserves.
However, I do have quite a few initial concerns...
Oh no, it's in Africa again - I remember all the troubles in Tanzania. I can't see RSA being much better. I have shares in Thungela and even for lowly valued coal in comparison with gold, they have infrastructure and crime problems aplenty.
The reserves are only independently verified, not JORC.
How aligned are the goals of WRE and BBBEE - is this likely to be the cause of future friction?
Looks as if no open-pit mining, so extraction costs will be higher.
Issuance of additional 110m shares, conditional admittedly, will dilute us nearly 40% - we need a high confidence level the reserves are as stated.
Do we really want to get into possibly mining?
WRE was in business rescue - why was this and why isn't the wealthy Creasy able to bail it out himself?
On the plus side, BoD members have experience in RSA and the tenements do seem rich.
What an outcome. I'm on a free ride now - big congrats to all those the held there nerve over the last 12-18months.
Sorry typo
“Couldnt finance this”
Panda1 good post how come super rich Mark Cresay couldn’t find this or anyone else I mean look at how much drilling has already been done is it the risks of local organised crime in mining or the political move towards BRICS and how much dilution coming to fund both projects.
The millions of gold oz could be there but it has to be proven and then extracted or sold on I would like management to fill in the gaps before I add.
Deep mining. very expensive. other SA mining listed in UK struggling on v cheap valuations.
I had a quick look at the lead prospect on the licences where there is a JV but the gold resource appears to be 1km to 2km below ground. A deep underground mine would be very expensive to develop, possibly in the $billions. Has anyone managed to find details of the scoping studies that are mentioned in the RNS as that would provide some interesting details? It's good to do a bit of research on the potential transaction before jumping in, especially when the share price has risen so much already. It would also be interesting to know why WRE has been in business rescue proceedings since January and wasn't able to secure finance.