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Colonel, I disagree with you when you say that BHP/NCM would not be happy with a capital raise at a low price. In fact, I think this is their preferred way forward. It allows them to maintain or increase their ownership of SOLG (we have to offer them the chance to participate in any raise), and, in the event that he does not have funds to keep up, dilutes the % of the company controlled by Nick Mather through his various holdings.
Cuzzubbo is in a difficult position at the moment as he attempts to follow a strategy and raise funds that placate his biggest investors: BHP, NCM and Nick Mather, who by virtue of his combined various holdings is actually our biggest shareholder (DGR, Mather, Tenstar = 17.6%). The problem is they clearly don't agree.
Mather would much rather we did another Franco-type deal as he wants to bring in funds with minimal dilution, to progress the work at Cascabel and prove up the regional portfolio. This allows him to extract a higher offer from whoever ends up buying SOLG. He spelt it out quite clearly 2 weeks ago - he wants this sold. The issue Cuzzubbo has, as he half alluded to in the MiningNews piece, is that to do that type of deal, with Boliden or whoever, risks the ire of the two majors we have on board - BHP and NCM.
I don't think we as investors should underestimate the possibility of both of these players 'going nuclear' if they see the profitability of the mine be sold off bit by bit in royalty or streaming agreements. Ultimately they (or at least BHP) want to own the project and reap all of the rewards, if we continue to eat into the profitability of Cascabel, would they bother hanging around owning just 13% of it (less given it's 13% of 85%)? Cuzzubbo will be all too aware of what happened to the other Directors who fell foul of the majors - they lost their jobs.
I have no idea how Darryl plans to balance the interests of BHP, NCM and Mather over the mid-long term.
This year, unfortunately, I think we'll see a fundraise at 20p, followed by the delivery of the Porvenir PEA and Cascabel PFS addendum before the AGM. I also expect to see, as Ortherncopper mentioned on here the other day, Mather to make a play of sorts with his holdings.
I think the reason PIs have been in the dark about what SOLG's actual strategy is, pretty much ever since Nick stepped down, is because the two CEOs since have been somewhat hamstrung by their biggest shareholders.
I did say they would have to hand them back ,they need this management to get their act together imho or lose the lot
Redknight, are you sure the $430m is for ENSA alone? I thought it was a summary of the 60 concessions which required minimal $7.5m spend or they have to hand the blocks back.
I also understand that due to covid, commitment timelines have been extended.
Red.
My only point it's not all doom & gloom.
P.s. I am prone to the occasional drop of white Burgundy myself. Maybe a bottle of Meursault when the bid lands :-)
Come on Damers. I've simply stated that timelines have slipped again since his arrival.
Whatever the reason, whether it be PFS2 or whatever, that is a fact and is based on decisions he has made.
And the $155m quoted earlier has to be spent on "minerals exploration activities" (from the IPA)
Meanwhile, I've checked back the last MD&A which states that Total Capitalised expenditure on Cascabel to 31st March 2022 was $255.15m. This equates to 'minerals exploration activities'. Planned expenditure for the quarter to 30 June 2022 was $6.91m, so the Total to that date would be $262m.
But the commitment under the IPA was for $430m by end 2023. This means there is still $168 million not $155 million to be spent on Cascabel exploration alone.
Add to this the costs of the DFS (which has also slipped under Darryl to end Q4 2023); further permitting for the mine; the cost of fiscal negotiations; the cost of the Porvenir PEA; further drilling at Porvenir and Helipuerto and quarterly admin costs all lead me to revise my estimate of the total spending by end 2023 (even before negotiations for the Project funding) up to c$200m which means that to achieve a cash balance as low as $6m another $180 million would be needed.
Of course this is assuming Solgold is still independent at the end of 2023, so it comes down to how much is required to move Cascabel forward towards the $430m; the costs of the Porvenir PEA and any drilling costs for exploration other than Cascabel before the end of 2022.
"Cascabel project Definitive Feasibility Study (“DFS”) planned for completion in H2 CY23"
Ffs damers
Is hopping for a rabbit out of a hat an investment strategy or a way to run a a business?
Get back in your burrow
Red.
Cuzzubbo started in Dec '21 - going back to statements issued in Sept '21 and accounting them to his tenure is ridiculous.
None of us clowns have a clue what's happening in the background, so I think there should be a little more balance when debating where we are at.
Am I happy with the current situation & SP - not in the slightest. However, there is the skill set at Solgold to hopefully pull a rabbit out of a hat in the form of a Bid or JV in the near term.
Damers.
There goes red again.
What happened to the greatest hole in the universe?
Nothing more than a cheap window salesman trying to con decent folk out of their hard earned.
Scummy
Annual Report September 2021
"Access to open pit material will enable initial production to potentially start as early as 2026."
August Presentation:
"Production Start q3 2029"
Chin up Sean, it's always darkest before dawn.
Something will happen when we least expect.
Not if it’s sold
To repeat
They have to spend another $155m on Cascabel alone by end 2023.
redknight1, I'd have to check back but think the lowest the cash pile has been pre raise was $10m about 18months ago.
It's no revelation that SOLG need cash to deliver DFS but question is do they have enough to deliver PFS2 and Porvenir PEA? Probably not but it wouldn't take more than a smallish $25m raise to see them through to year end and you never know, if they do add in an extra $1bln to Alpala then perhaps do a larger DFS raise after that?? Would make sense as markets likely bouncing after Inflation hit peak levels in November and Fed et al start looking to cut rates into 2023 to starve off recession.
The key point that should be acknowledged is that ENSA funding is always ring fenced with a portion toward general Admin staff costs. Valuestone invested $5m into Porvenir (ring fenced) last time and I imagine if they were asked to do so again would be happy assuming it's sub 32p which is their last price level.
We don't know the facts around the rumours on a failed funding round but there are numerous ways to look at it. SOLG may have tried to do the lot in one go... through to DFS and suspect BHP and NCM not happy with something so it got shelved. They could try again with a smaller amount which would be hard to turn down and even at low 20's would be minimal on dilution which would please many but not BHP and NCM. I reckon they might go for small raise and see them through to PFS2 and then larger raise with share price into the mid 30's based on adding another $1bln to ENSA.
Red,
Construction / production has not been put back twice under Cuzzubbo's watch.
The presentations are just becoming more detailed as they go through the studies.
Junes presentation detailed just: Early works & Construction / August presentation has spilt it down to a further category: Early works / construction / production) - you will see on both that the intention is to start Production Q4 '29, with construction starting Q4 '24 - no change but just more detailed.
Please stick to the facts matey.
Yep was end of June - went through the RNS's
So end of March had 38m end of June 28m means at current run rate slightly over 8 months before out of cash.
The key word... Testing
Rk. Don't you mean vnow lookv
Listen...Darryl's been there five minutes. He's certainly stamping himself on the company strategy but what has he actually achieved in 8 months?
No cash raise and Construction/production already pushed back twice!
I don't care what he says.
The $26 million was at the end of June 5 weeks ago.
They tried a cash raise and failed miserably. That is why they had to issue two 'cleansing statements'.
In case you don't understand what those are, they are needed in order to release investors/potential investors to deal in the shares again after they were precluded by signing up for what turned out to be a failed equity raise.
And maybe Darryl's talking his book.
The strategy makes a lot of sense to focus on two major projects but especially if cash is being managed we no longer get the flow of sexy drilling results.
So with the copper price depressed, Cascabel pushed back to 2029, Rio a duster, no news for 18 months on small projects J/V's, what is there to go for except a passionate e belief that there will be a takeover battle no later than late December...?
In the mining news article the CEO says they have 26m in the bank. He also says the company tested the market.
Red.
Maybe the company knows more than you!.
And sure the feelers are out, testing the waters.
Always best to have a plan A,B,C....
BTW I'm prepared to be wrong but I don't remember the cash balance being lower than $26m before...
No he didn't.