Savannah Resources Share Chat (SAV)

As far as when, not sure if it's very relevant as they would have been paid once the Ministry had confirmed that things had been provisionally awarded subject to payment of the fees, no doubt with effectively an invoice. Presumably SAV will have checked through the T&C, and the level of the fees and then paid them. So it's taken a few weeks....in the scale of things, not a problem.

I seem to remember DA saying that the fees were relatively minimal and covered (USD 50k rings bells).
Concession with a capital C refers to the boundaries of each of the tenements rather than additional concessions or agreeing to terms by ceding any special t&c's.

Reference to the report in this news article dated 18th. November:
https://clubofmozambique.com/news/savannah-wins-third-mutamba-mining-concession-in-mozambique-147247/

Savannah CEO David Archer said: “The conditional award of the third Mining Concession to Mutamba Minerals Sands SA completes the tenement set of the Mutamba Project in Jangamo/Inharrime and represents a significant achievement for Savannah in its joint venture with Rio Tinto.
“To finalise the process, the normal administrative payments and processes need to be completed; these are currently underway for all three licences.
“We are completing the administrative conditions in a chronological manner following which all three licences will be fully formalised in due course, which, when completed, will continue to consolidate our position in the Mozambican mining industry.
“Once these three Concessions are formalised, they will enable the joint venture with Rio Tinto to progress the Pre-feasibility study (PFS) towards completion.”
The company’s interest in the heavy mineral sands project will rise from 20% to 35%, upon completion of the PFS.

So Punj is right to ask what the payments are and when were they completed (if they have).
What concessions and terms of agreement were negotiated to complete the issue of licences 1 & 2?
Is the news of this to be drip-fed, as it seems is happening, with a prospective cash call on the horizon to pay for the PFS and all of the licences?

Can is the correct wording because SAV can choose whether or not to deliver the PFS. As for using the word 'does' just have a look at the grammar lol

In my opinion you're a troll with zero interest in the company. You have been told several times to ask the company directly for clarification over your numerous gripes. Any normal person who was genuinely invested wouldn't keep whining like a kid that can't get their own way.

I have always assumed the ownership % is automatic on completion of the PFS? If Rio wants to fast-track development of Mutamba and exercise its option of buying out SAV beforehand then “can” no longer applies?

A rerating of SAV must surely take place soon on the back of an up-to-date market appraisal of Mutumba now the permitting process is virtually complete. Indeed, one might well conclude that the rerating process is overdue.

“Savannah currently holds a 20% interest in the Project but can increase this to 35% upon delivery of the PFS...” Back to the language of ‘can’ increase rather than ‘does’ increase....

Hi CM, as you say the market rolls on and so decisions will no doubt need to be made and implemented. I would expect them to have worked out possible scenarios previously for contingency planning as long term supply gaps are a mixed blessing.

Should it change from a supply agreement for RB effectively into a production facility then as you say, it's a quantum leap and with mcap currently around the mid 30m, including the Lithium, it would be small biscuit money if they were minded to recapture the prospective value that was agreed away in previous times. Interesting times.

IB, the only problem with the $463m investment funds to develop Richards Bay is that they were meant to be generated solely from Richards Bay revenues, not some Rio “money tree”. See https://www.riotinto.com/media/media-releases-237_27331.aspx
Now that production has halted, the funds will not be created? That aside, I believe Rio has about 1/3 of the TiO2 pigment market, largely supplied by Richards Bay, so are unlikely to let that disappear? I would imagine they are doing some serious Plan B work at the moment and the door to production opening in Mutamba must be a timely gift? All considered, my money would be on a Rio fast-track to production in Moz, with or without their 20% Project partner. Either way this should be good for SAV and our current almost unbelievable undervaluation.

BigSoc, SAV don't do timescales these days though now they have a firm foundation with MLs in place, they are back in control of events to some extent and would be able to work to targets.

I remain interested in understanding whether the 100% offtake agreement could actually be a drag on any decisions or future ramp up if RB remains in limbo or whether RT might re-direct the proposed 400m+ to develop processing plant on site in Moz. RTs history in Moz may make this difficult but the prospect of a 49% holding now that it's resourced up and licenced or dare I say it, oven ready, might be generating some number crunching and thoughts.

I believe production will commence in the coming months.

Now the concession has been awarded I think SAV needs to give a new estimate of when production will begin.

That comment re production in 2020 was taken from the scoping study published on 30 May 2017. Looking at the history of SAV and deadlines achieved over recent years forgive me if I don't get excited about something that was published two and a half years ago.

A mining license granted to block 9735c provides direct access to the pilot plant near Inhambane via a main road running through the block.
https://www.vivifucecchio.it/Sat/09_8306/mutamba-ilmenite-mozambique/
Targeting first production in 2020 with average annual production of 456,000t of ilmenite and 118,000t of non-magnetic concentrate
https://www.savannahresources.com/assets/mutamba-jangamo-project/

Punj, I think you are confusing the Moz licences with the Oman licence fees issue? I don’t know what we paid Mozgov for the licence but it will have been worth it.

Any idea of what the fee we had to pay for the licence was?
I thought it was still to be agreed and announced.
If so, will it be the same for all the other 3 licences?

Regarding funding, Rio own 80% of the project and are facing a huge problem with their Richards Bay project where a $460 million expansion has been put on hold following lethal violence in the local communities. Could see this being redeployed to Moz to fast-track the Mutamba project. Would be the wrong time for Rio to face supply problems with the price of mineral sands products up 20% since the summer already. Could actually see them buying us out in a flash at the agreed many multiples of our costs before we complete the PFS.

Hopefully this is the beginning of pieces beginning to fall into place, despite somewhat belated, just hope we have sufficient funds to either get to the position of some production or an agreement of development funds to avoid any further dilution. It has been a fairly depressing period with regards to the sp.

Nice early Xmas present from MozGov! Let’s hear no more from the doubters now. There is plenty of value to be added for SAV via the PFS. Longer term could Rio consider relocating processing from Richards Bay to Moz? Has to be an option?

Now lets see if it relates to an increase in SP?? Fingers Crossed.....

The best news we have heard for a long time!

This happened a couple of years ago and then they recently confirmed further investment into RB which was positive. When we get confirmation of mining licences there may be a 100% offtake but where will RT ship it to? Currently they may want to keep production to a minimum and delay longer term ramp up of production. Maybe RT would be prepared to set up an RB operation in Moz though with coal baggage, probably unlikely. Another thought for the day.

In SAV’s case, the Rio Richards Bay plant is the customer not a competitor as Rio will take 100% of Moz production when it starts to produce. Can’t see how closure of the plant will help us?

Ofcourse you have to be aware of the volatility in parts of the world such as this, but there is a potential upside to capitalise on if cards a played right.

https://www.proactiveinvestors.co.uk/companies/news/908455/base-bluejay-and-savannah-all-set-to-benefit-from-increased-mineral-sands-prices-following-rios-suspension-of-operations-at-richards-bay-908455.html

In the news due to escalating violence. A reminder how volatile things are in this part of the world. And still we wait in Moz.