The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Thanks everyone.
ACP has had the existing prospecting licence areas outside the mine licence pre approved for renewal but they have also applied for prospecting on 3 additional large areas surrounding existing licences.
I believe MBs future plans may involve going downstream (needs to be more processing outside of China and for ESG purposes less moving material around the world to fulfill each process is beneficial... Also for EU/US supply they will want supply chains outsude if China, so look for finance and partnerships in future as they try to tie up non Chinese supply etc) , but you need to prove up some more resources to supply and make it worth it over many years.... If not they need to plan for 20years+ supply using high TGC feedstock to stay ahead of the pack in returns even during low prices.
Also why wait for new mines to come on line when it is way easier to expand and finance an existing high cash return mine using some of the best quality graphite in the world. Tanzania will become the next biggest producer in time, the material is just too good to be ignored and due to quality and grades the economics are great.
Yes but not for a while
Am I right in saying that they are testing the other existing area to see if there are good deposits there or am i wrong in that?
Must admit a newbie regarding stock investments, yep have made some initial mistakes, hence feedback most welcome.
1. Bwana - thanks for your detailed synopsis, most helpful. Sensible/logical analysis (much respect!).
2. Dee12... -I agree with your points wrt comparisons to HZM, different scenario. But must admit I'm a prudent half glass empty sort of person.
At end of day, suspect this project will get to production and deliver! And yep I will, as a LTH, be very sticky with these shares.
Virtually. He only has 5,555,554 warrants at 3p which expire on 30th September.
So was the recent deadline for Kabunga’s warrants the last of his warrants?
Been patient here a long time. Pleased to see the SP moving north again.
Time for reward for long termers...
1. I agree with you there
2. The last thing I'd expect is a HZM type dilution. I think ACP will be negotiating pre-payments for offtakes like their peers have done.
That being said, a dilution wouldn't be the end of the world, so long as they can get the market cap up.
It has been nearly 7 months since the ML was granted and we have had no real operational update since then.What we have had is:
1)The appointment of an apparently very experienced project director in December to get the mine built.
2)The appointment of a Blackrock proven consultant in February to agree/negotiate the Government free carry.
3)The conversion in March of 7.8m warrants into 2.2p shares by our CEO at a cost to him of £172k and a resulting enlarged shareholding for him of 9.74% of the total capital outstanding.
This all tells us the following:
1)The mine is going to get built by us.
2)The Government carry should be forthcoming in a decent timeframe and as AIM says below should come in at the standard 16%.I completely agree with JSD71 below that this carry is good news as it is in a way an insurance policy against further Government meddling, and against the backdrop of some African mining mishaps, is in fact a very reasonable price to pay for insurance.Anyone who remembers the Acacia Mining scandal in Tanzania in 2017 will get my drift here-fortunately that was in the Magafuli era, Samia Hassan and her team have taken a genuinely much more enlightened approach to foreign mining companies and it is only fair that Tanzania benefits from the success of these companies.
3)Matt Bull is very confidant of the future-why else commit £172k further to the project if it is not going to suceed.
I have been as frustrated as all of us by the lack of operational news, but I feel it has to be very close now and when it comes it will be very good.I also think the 7 months wait for operational news has been too much for many weak holders and they have exited with Kabunga leaving quite a few LTHs the opportunity to pick up more shares and a few new guys like Strummer (a known LTH) to build positions.My hope therefore is that when news does land the shares will move pretty sharply as LTHs hold tight.There will of course be some derisking,but hopefully the quality of news will offset this with new money arriving.Hopefully MB will assist this process with plenty of comms, interviews etc.Pointless him doing those now as he cannot tell us anything as he will be in a very rigid "quiet period" as he negotiates offtakes,finance etc.
GLA this will fly at some point and that point is edging closer-we know that and the market makers do too apparently.
Yep good SP rise today but as per title, constructive feedback/advice most welcome.
ATD has raised some very valid points today. Personal view;
1. Glad that the 16% Govt issue has been highlighted again - a personally have no issue with this (partner's working together for betterment of country + taxes etc), maybe bodes well for extended mine licence/further areas of exploration, but needs highlighting as suspect some PI's probably don't know.
2. Being prudent, I'm personally expecting a possible further dilution of say 20-25% on financing CAPEX (? - HZM example) - happy with and have funding ready.
BUT, the above two points are only relevant when this project get's to production phase (profitable) and that as a PI is the most important consideration. If this happens , suspect the financials' should be a win/win position for all.
Suspect MB has been a clever cookie wrt to handling a certain background seller and suspect news will come when appropriate? Maybe just have faith in this project, I'm LTH, hence happy to ignore future drops/ups etc which no doubt will happen and await potential dividend payments
I didn't mean they had to sign it off per say, but you'd need to present them the latest business case so they knew what they were getting into and what you were bringing to the country etc. I should imagine a very lucrative and safe economic project would get favourable backing. They want it to succeed too. I like that ACP are getting more prospecting areas, good sign that ACP is there for the long haul and considered a safe bet. Would a project with crap economics and low IRR be given expansion possibilities?
Warrants, yes that crossed my mind but wasn't that info out before all paperwork and payments for warrants might have been complete? It still does not explain the complete no brainer of converting using either existing shares or converting to sell, was enough in it to make a decent turn. I could understand strike price level or above SP causing forfeit.
Start of month block listing will tell all.
The gvment free carry isn't a bad thing as it will essentially make the tanz government a partner so that box will be ticked without having to worry about future retro taxes & disputes, also hugely beneficial to the Mahenge region creating jobs & infrastructure for years to come. Mahenge will become a hub for graphite production.
Thanks Mick88,
Pity we lost out in the end, but at the very least we managed to get The Mexican President speaking out specifically about Sonora!
I think some of the things we all overlooked with BCN was the lack of ownership The BoD held - We don't have that problem with Armadale. A good holding from the CEO, a willingness to bleed out negative influences, and only a £33,000 salary.
If it goes tits up, at least we know it won't happen due to boardroom greed or lack of shareholder alignment.
AIMtodeath,
You make some very, very valid points. I didn't realise The Tanzanian Govt would need to sign off the new DFS.
Railways often have capacity issues, but where available they tend to drop freight costs immensely.
I saw a lot of the buys being Friday afternoon which made me think some people wanted to be in for Monday morning.
Somebody mentioned warrants - When the Total Shares Outstanding were issued there were only a 2 million difference when adding the CEO's warrants to the new TSO. That would indicate that only 2 million warrants aside from The CEO's were converted.
16% seems to be the figure mentioned in laws etc and applied to the other 3 already gone. But they still need to give their intention to commit etc and to therefore finalise the DFS based on their commitment or not.
basket pricing was done during the pricing lows and sure that forecasts were equally conservative (though some pees have very high basket prices, to help their awful economics.... Watch out for 6% NPV tricks too!) when considering battery fines pricing ahead compared to the EV explosion and quickly rising prices. ACP has a very similar basket to BKT in every sense and they have continued with $1300 so that is worth 30% ounces to ACP NPV. That more than offsets the 16%....however the big unknown is mine life extensions and/or output increases in a 3rd expansion.... That would be nice to see, they certainly took plenty of time on DFS for only getting new costs and a basket price change!?? Must be more to it. Might see hydro power for stage 1 now and something on rail transport, which would have been agreed with BKT as they'd be sharing infrastructure.
The new prospective ground suggests mine life and output expansion in the future, but also Gov support giving ACP the rights to apply for the ground.
A lot in play, but even at the bare minimum I'm sure any basket case increase will absorb the Gov 16% so everything else is a bonus.
US and EU desperate to secure supply chains away from China but that might be likely with the large flakes, I suspect due to all processing in China the battery fines will go east.... Builders and finance could well be Asian too. 2 years ago id say it was all tied into China but must have western offtake /finance interested now too. I hate the delays but what a difference the market is now and ti what prices and deals for offtake and finance ACP would get now! Silver lining??
Nothing on offer and they bid up quickly to find sellers to get stock.... This is a good thing... Ha. Try buying volume now!
Unless K sells his dregs to fund his shut down mining operation in Ukraine... My heart bleeds. Must admit MB has bled him dry by not giving him any extra value before it can't be held back. Once the news flows I suspect MB will sing like a canary because you can't put the news back might as well ride the wave. Pumping the SP with no concrete news would just have given K more money albeit we have to undure low prices and new entrants like Strummer get to fill their pockets on Ks misfortune /investment decisions.
AIMtodeath, correct me if I'm wrong, thought the gvment free carry was fixed at 16 percent? Saying that expecting a bump up in npv when update dfs is out.. Graphite prices are trending upwards due to many factors & uncertainties only adds to securing reliable sources.
Acp are very well placed.
Isle,
The only person required to notify of warrant conversion is the director. Individuals will not notify or be broken down in the block listing. The block listing had been reported end of month several times and I don't see that changing necessarily. We will just get told total conversion and any forfeited. At 2.2p I'd be surprised anyone would forfeit them it was easy money if you wanted the quick sell... Or if you wanted a bigger position 2.2p was a gift.
K has a new Volt share offer coming up he probably cashed in, but block listing will not tell us who took what just the totals. However if he was short of cash, you would convert 1m warrants, sell them, buy 2m warrants, sell them, buy 3m warrants, sell them etc if you were desperate.
Dee, I wouldn't call that FOMO, just a lack of sellers to reverse what has been a steady share purchase going on since 2.2p warrants came to en end. I look forward to FOMO though! When the genie is finally released.
Gov now holding up DFS, as soon as they agree their cut DFS can be released I'd have thought, given ACP would have had to present to them the final economics. Now that the process has been done anyway by BKT and 2 others the process should be somewhat ironed out.
Then should follow deals as the economics get the go ahead and last obstacle to start mining is cleared.
Hi Dee (you led a wonderful effort at BCN)...hope you are just as much on the ball here. For me, the timing would be shear luck rather than expertise... :-)
I feel there's a huge opportunity to be had here over the long term - And either there's a leak, or people are FOMOing in on anticipation of a Monday RNS.
@ Strummer.
I'm still waiting for the notification that Kabunga has exercised his remaining warrants.
2 weeks after the expiry date and still nothing.
Does this mean that ACP have not received the cash? Or maybe Kabunga hasn't exercised his rights to buy because he has no cash?
Either way, we should hear in due course.
full as there.
Assume that with the expiration of those warrents recently, the big seller of the last month's seems to have halted for now at least?
The ability to load up under 4 has passed for now it seems. Now under 4.5 is a target if one thinks that news (at whatever point) on the project will energise it.
I am still gradually building a few more in here. Picking a few dips to AVG down from my first buys in the high 4s.
Took a few more earlier today to stand at Currently 3.5 Mill @4.21 AVG.
With new ISA year coming may add a few more then. But suspect if the buying here carries on for two more weeks I guess this may then be closer to 5 than 4 to add. That's a guarantee then of a sell off with that kind of prediction..
.. :-s
We shall see though.
Cheers.
with a speculative 112k. Hope I bring some luck on board.... GLA
Well said. I’m getting antsy now!
The time this is taking they'll invent lab grown graphite or some cheaper material. Battery storage is fast evolving.