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Rcgl why would bhp team up with cgp. Let's face it they will become a headache later for which they receive nothing from that relationship. As for solg we have brought the discoveries to where they are now with Bhp/Ncm and developed relationships in Ecuador all as we promised for the funding they provided. I don't buy Bhp wanting us out the way but time will tell. They have an opportunity to get rid of cgp now and then deal with solg direct thus keeping overall price down. Imo of course.
Thanks JungleJane, that is more in line what I was asking. Whilst understandably most people are obsessed with what price we may get, there are three aspects to this, (1) we want the highest price possible, (2) any major wants the lowest price possible, (3) Ecuador wants the best result possible for them to realise and unlock the resources they have whilst keeping the people happy and creating jobs.
BHP's anti dilution rights expire as of the 15th !!
Believe NCM has already lost theirs as they are over the 10% agreement, if it dilutes below the 10% holding then they will be allowed to take it to the 10% again. If NCM were to drop below 5% then the anti dilution rights are null and void
''what extent the government may sway how this ends up''...nail on head with that statement...the politics will have a significant influence on events. Ecuador wants to see an influx of international companies into Ecuador as this endorses Ecuador as a place for secure private investment.
Hi addicknt, I always believed this was a good offer and CGP should take it. Agreed we didn't have the evidence at the time, as we have only just started drilling recently. But to me, this has always been about the future. It I had been a CGP shareholder, there was a time during the offer, that I could have sold my CGP shares, and brought Solgold shares, as CGP were rising in price, and we were stagnant. And they would have got more than 11 shares a share. I believe they have missed this window of opportunity, but we will soon see what happens.
swsquires, I started my career in Ecuador and I have worked there thirteen years in total including being a director of the chamber of mines (a long time ago). I watched the government destroy the nascent exploration industry three times due to it's inability to understand the timescales and risk involved. I used to say that if the golden goose arrived in Ecuador they would kill it in the airport. NM and his team have taken the correct approach from the beginning. Stakeholder involvement is not for lip service, especially in Ecuador where they deposed 8 presidents in 13 years for not listening to them. I would say that the decline of the petroleum industry is responsible for the change of heart we have seen. In theory the government would prefer Solgold to do the project themselves, but in practice, the government is up to its neck in debt and they need large companies and massive production to escape. My view is that as long as Solgold don't scare the horses, the government will continue to support them whatever the decision. It's not like they have any choice. I would caution that the Ecuador government is prone to shooting itself in the foot near to elections so nothing is ever written in stone in this vibrant, infuriating place. DYOR and GLA
Quady, this was not a question about Apala as I fully understand the timescales involved. This is about the entire portfolio owned by Solgold and to what extent the government may sway how this ends up. As we know, Alpala is just the first one.
Good morning swsquires, this point has been brought up many times. The time scales for Alpala are in ENSA. NM and JW and the Ecuadorian mining minister, have all said, that no one can execute this faster than Solgold, to get it to production. My understanding is thus. Again two Scenario's .
First scenario: Alpala is sold, this is a right mess. You get a 10% tax immediately and the environmental licenses, have to be applied for again, including the water permit. This is a long process, as you have to prove what you say, and you need to change your Governance within the company. Maybe up to a years delay.
Second scenario: I got this wrong, but this is what makes this chatroom so good, as I was corrected, I checked the facts, and said sorry. Solgold is sold as a whole. The licences transfer, but, again this takes time, and the bidding and selling process takes the time. Especially if Solgold defend the bid.
So no one can build Alpala faster than Solgold. Hope this helps.
Thanks, Quady. So if we take Sav's point, it's likely to be circa 13.5/14%. Which brings me to my point. Given what's been going on with our other concessions and how amazingly exciting they look, why would we want to be diluted? Sure, Alpala is very important, but if we follow you rout to production and end up mining three/four or even more Tier 1 mines, it will begin to look a bit daft to have handed CGP this number of shares.
Good morning Savshare, the Solgold shares that CGP own are in the calculation, I didn't make it clear. Because the Solgold shares that CGP own are less than 10%. 7.6 % I believe, we absorb them into treasury. This makes a bid harder still, and we can sell these on the open market if needs be later on, to continue funding exploration on other targets. ( with no further dilution ) But well spotted. Thank you.
Solgold seem to have focused a huge part of their effort in getting the government and the people of Ecuador onside. They are hiring and training locally, investing in the environment and re-emphasize that this is for the Ecuadorian nation. The more I have read on this, the more impressed I am at how Solgold have really tried to be a partner in this venture.
That brings me to my question. From the perspective of the government, they want mining up and running and sending money to the treasury. This means that it is in many ways in their interests for majors to get involved as it accelerates production and thus revenues flowing through. But, in Solgold they have a partner who has made great efforts to work with them and the people. Taking the example of BHP destroying aboriginal sites recently, how much do we think Ecuador would trust the big boys? In my mind I think they have trust in Solgold and how they operate, but would like things moving faster. To what extent do we think the Ecuadorian government could play in how this ends up?
Biswas (CEO of Newcrest) did state that he sees 'long term value' with SOLG so they're here for the long haul though in what capacity I have no idea. I doubt they'll be happy with remaining a shareholder of SOLG
I'm not surprised by the strength of the share price. I think based on Porvenir, PFS and now Blanca and Rio drilling, the share price would be doing just fine with BHP locked in till 2021. The fact BHP is free to pitch a bid come October 15th/16th just magnifies the intensity of the upcoming period. It's insane. So many catalysts and each one with the ability to double the share price and some and that's from 45p levels upwards.
I've been in these markets for many years and have never seen a tier 1 project or several tier one projects take to development by the minnow that discovered them. It's very very rare but not impossible as proven already by NM and Franco deal.
I tend to rely on a fair amount of common sense as it's often what the markets lack most. And common sense tells me that if I were BHP or Barrick and I saw the data on Alpala and now Porvenir along with the rest of the 13 x Alpala style opportunities... I really wouldn't blink at the thought of laying down $3bln or $4bln to gain the lot. Super majors are making huge cash with PM's at present but reserves are not being replaced that quickly. Some countries or regions have become more unstable over last few years and more so down to covid stresses. If I were BHP or Barrick, I would not allow SOLG more time than I need to. I think i've seen enough to know the opportunities that lay ahead. Question I would be asking around the M&A table is... what can we do to get this without triggering a bid war or auction? Is there a way we can secure a solid footing and defense but still give SOLG shareholders a chance of some upside ahead via folio exploration?? BHP and Barrick are not friends and imho, they both want SOLG but BHP has a clear advantage.
I want SOLG to be 'bid' free for at least another 6 months, but my common sense tells me that the super majors are not going to hang about and all are waiting for the starter gun to go post October 15th.