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..........and the number of share options available to be exercised (which I don't know)........
I've looked back and at my notes and on 5 October Align Research stated that we had about an additional 68M shares (warrants / options) against fully diluted holding. I believe this has now increased by about 30M to £98M.
I therefore think its more realistic and accurate to use fully diluted 835M as shareholding rather than 735M in issue.
So that's a 12% reduction against previous valuations.
Trying to keep my feet on the ground I suppose the other thing to be considered is the cost to get to a point of sale (which i can't see being a significant portion of the value of a sale) and the number of share options available to be exercised (which I don't know).
Andrew, my only reservation is that you can drill into a deposit and not get a true impression of the width because of the angle of attack leading to exaggerated figures. I can't get my head around quite what this thing looks like or the angles of the drills relative to that deposit, but the numbers are big and the more data the more confidence we can have. Exciting times. Right - off to get my chips.....
I've started to come to the same conclusion of ' if it sounds too good to be true...etc' and that is why I asked for corrections.
The post was not intended as a 'look at me arnt I clever' or ' this is going to be great and we are all going to be rich'. It was more of a request for critical analysis and debate, in short..... 'what have a got wrong here' ?!
Maybe I'll realise what I've got wrong in 3 months time when we have more info and I'm looking very silly with these sp values.
But at this moment in time, with what I think I know, something has to go very wrong here for this not to go way above 30p
Andrew, I think your numbers are conservative so the value is starting to fall into the 'if it sounds too good to be true....' category. But I can't see anything wrong with the geology, drill depths, grades or numbers. And that's without Africa, or the potential for the other local deposits which, being so close are effectively parts of the same deposit and would in many ways be treated as such. I don't want to print the figures out as it starts to look like telephone numbers - and we wouldn't want to ramp.. would we!
Hi Ella Yes you may be right that the LxBXH to get volume may not be accurate as all the lengths stated may not be correct. We need more holes to br more certain. I deliberately was under on mineralisation lengths - to be on safe side.
But even if it 0.75B tonnes at 0.2%, that's 1.5mt.
We need more drilling to accurately determine volume, but we may find more drilling increased volume !
If I am over with the 1B tonnes estimate, I think I am under with the 0.2% cu eq.
We are going to be very unlucky not to get to 2mt imho.
Hi Andrew, I've posted this before. Although we have 3 dimensions are I'm not sure what we should use for an average width as it appears to be wider at the bottom than the top. My understanding is that the length of the ore body doesn't correlate directly with the mineralisation in any of the holes but I'm no longer confident where the 3rd drill was. On a positive note the strike length has been said to be 1000m and the depth you have used doesn't seem to account for the bit of mineralisation offset at the top of the ore body. The differences in my view of the dimensions and yours probably cancel each other out. I think we are definitely over 1 million tonnes and well on our way to 2 million tonnes of contained copper. I'm not sure how realistic $9000 POC is for a long term project. A really significant increase in SP does seem inevitable. :-)
2 million tonnes at $9000 at 3% plus the african assets and the 20% xtract will retain comes to 98p per share. Now wouldn't that be nice lol Keeping hold of my shares for a while yet. :) I'll be happy with 25p to be honest.
Although we don’t get know exactly what the grades will be until we get assays results, I’m sure the grades will be, at the very least, reasonable. In previous interviews, CB has said three things that have confirmed this:
1. Copper grades are very similar to other porphyry’s in the area. 2. Not worried about the grade, it’s all about the volume. 3. We know these systems are between 0.25% to 0.45% (the most recent and pointed comment in the share prof interview 23 Feb 3 min 10 secs )
So if grades are not within the range implied by CB or are very poor, then his credibility will be shot. Just like with his ‘No news is good news comment’ I’m sure he understands the negative impact of him making these major statements and then being shown to be wrong. So I’m sure the grades will be, at least reasonable and consistent with his comments.
Imho the lowest possible copper grade that could be classed as consistent with CB’s comments would be 0.2% Cu Eq. (average)
From the first three drill holes so far, I think we have about 1 billion cubic tonnes of mineralisation (hole 1 approx 940m x hole 2 approx 560m and x hole 3 approx 665m) x 3 tonnes cubic mtrs
Happy to be corrected if anyone thinks this is wrong.
So, If we assume the average Cu Eq is 0.2% (including any gold) then total mineralisation has to be 2Mt minimum (1billion x 0.2% Cu Eq)
I believe the 0.2% Cu Eq is the lowest it could possibly be to ensure any consistency with CB’s previous comments re grades. Imho it will probably be higher and in the range of 0.3% to 0.4% Cu Eq (average). This is more consistent with CB’s previous comments on grades.
2mt contained Cu eq. $9000 POG 3% Buy-out (Cornford in his article said that was conservative) 0.72% conversion USD to GBP 735M shares = 53p sp (ex Africa projects)
I can’t see how we are going to get lower than 2mt Cu Eq but even if it is, say, just 1mt and also assuming much worse figures of $8000 POG and 2.5% buy-out – that equals 20p sp
Of course if Cu Eq grades are a more probable 0.3% to 0.4% (average) and by using a more realistic POG of $9000 and less conservative 3.5% buy-out, you get a, hhmmm a slightly higher SP :)
I won’t work that out the SP using those more likely figures, otherwise I’ll be accused of ramping!
Of course AIMHO Happy to be corrected on assumptions or workings
Would guess that, even with the assays from hole 1 not arriving, possibly until the following week the drilling updates for hole 4 arriving by midweek will keep the price buoyant until then. Slow and steady rise please
Will be topping up Monday morning too. Would guess most people would have been paid yesterday so perfect opportunity to add shares. These prices will not be around for long with the assays due hopefully this week. For LTH’s quantity of shares is most important so keep adding as and when. Disclaimer...... Just be careful how much of your hard earned salary you invest as your home is at risk if you do not keep up mortgage repayments or on any other loans secured on it. If this goes to buyback numbers, you may not ever have to worry about paying the mortgage any more. Just my opinion