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.
SW'er--"Thats still a lot of money, its about 1/2 of their current market capital, its going to be tough to raise that all in equity even with the current momentum. "
It is true $25m is the equivalent of around half the market cap but I think the combination of up front funding from one or two off take agreements and perhaps a Government grant from the leveling up fund run by the recent SC visitor Lord Grimstone, will make an equity raise quite small, if needed at all. There appears to be large investor appetite for green revolution materials copper/tin/lithium as the recent oversubscribed Cornish Lithium equity raise demonstrated. If CL can raise £8m through crowdcube, I would think CUSN could well be oversubscribed too and have to scale down allocations, and that is if they have an equity raise at all. The management team have shown considerable negotiating skill recently - and given their CV's, are worth backing.
I think the timing is fortuitous for CUSN. There are undoubtedly current positive influences on the price of tin - covid- civil unrest, transport problems. But the long term backdrop of increasing demand and dwindling supply is also there, which will support the prices several years out when the (SC) mine comes into production. The amount of tin ore in SC is vast, ( RW estimated 20+m tonnes in the utube video) and with shafts and a decline already present, a lot of cost and time will be saved. Western Governments will also want this to succeed to increase resilience and reduce reliance on China.
Perhaps I should take a cold shower, but this looks extremely promising to me. Anyone know of a better investment amongst the small exploration shares?
I mean you have to bear in mind, last time tin prices were at this kind of price, the GBP:USD ratio was 15% less favourable. This matters cause of course the tin is priced in USD, but most operating costs and some capital costs will be in GBP. Of course there's been a bit of inflation since 2011, but overall, basically - its never been a better situation for the tin price, since the early 1980s.
Whatever your own views on the commodity market and metal pricing situation going forwards, and I imagine you have some, and I know there are some very bullish people on tin (and copper) out there - and they may well be right - but the reality is that the financiers are still not certain, and there is still this narrative that its a "covid supply side" induced shortage rather than a fundamental long term supply-demand shift that is driving these prices to spike. Whatever the truth, the reality is that (total) funding for a project with a fairly high price required to achieve suitable economic returns, with only a PEA level study - will not be forthcoming. That is basically an absolute certainty, before people get carried away.
However, right now, they dont need total funding. The next step is to start dewatering, and conduct further drilling of the inferred resources to bring them into the indicated category. For that, to run the dewatering and drilling operation over a two year period, they need to raise US$25m roughly (see the recommendations part of the new resource statement). Thats still a lot of money, its about 1/2 of their current market capital, its going to be tough to raise that all in equity even with the current momentum. So what they really need is for Osisko to stump up some serious cash, or for a new "cornerstone" partner to join them. Or some kind of miraculous government grant for the dewatering. But yeah, this next step is crucial. If they can take it, I think it adds value to the project, the dilution is significant in the short term, but the share price rises because the probability of production (and thus, value) being ultimately realised greatly increases. So they should take this next step, if they can, but thats a big if. Nonetheless, even if they can't take it, there is still the possibility of United Downs coming good, and using that as a stepping stone (starter mine) to lower Capex etc. So yeah the next few weeks/months are certainly crucial on both fronts.
I agree with everything you've said there Southwesterner. Personally I think we are going to hear some big news on crofty in the next few weeks, its nothing more than a gut feeling.
Behind the scenes they seem to have been lining things up with the resource update, securing Roskear shaft, working on Cooks (they're still working on it), sorting the waste sludge disposal, sorting the deferred payments, assuming shareholders agree to it on Friday (no doubt they will), I think its entirely possible tgat there will be an announcement shortly after.
Tin is at an all time high, yes crofty is technically challenging, but its literally shovel ready.
Appreciate your candour and honesty, and I certainly don't want to put you off posting. It's good to hear sentiment driven views, because there's no doubt on AIM sentiment is an important factor, certainly in the short term. But when you are just ramping based on misrepresenting an RNS that is about filing a technical report, as being "great news" on pumping and permitting - and about graphs of "rare minerals"... I'm not sure thats really adding much of value. Just confusing people.
Like, my view is that the lithium aspect is mainly hype, and the vast majority of long term value in this company likely lies predominantly in the copper/tin assets. But that is a legitimate point of discussion, and others are entitled to their views on lithium brine "DLE" projects. Obviously the immense valuation on Vulcan Energy Resources (ASX: VUL) now (A$1bn) would tend to suggest the market is more confident of this technology now, but I'd suggest its still hugely risky and unproven. Most other DLE projects appear to be in aquifers, whereas this is just direct into the granite and there is no evidence that I have seen so far of the ability to sustain lithium brine concentrations at production level flow rates, but I'm not saying that its not possible. Just that no evidence has been presented thus far, so those that ascribe value there are taking a leap of faith. It could be a huge commercial success, or maybe the accidental copper discovery at United Downs could turn out to be its main legacy. We will see.
So again, fairly speculatively, but starting to become more tangible, there are now 2 drillholes showing a high grade copper-tin lode to the north of the old United Mines. The evidence of lateral and depth continuity in the surrounding mines historically is significant and suggests there is a decent chance with this lode too. In the next 2 weeks with the next set of results, we should see more from the drilling assays. This could very easily shape out to be a great little starter mine. Equally it could peter out before it builds up critical mass. A small mine today, would be equivalent to a very very large mine in the 19th century.
And then we are left with South Crofty. Now there is really nothing intangible about this. This is one of the greatest tin mines in Cornwall's long mining history, and it clearly has plenty to give. But getting it up and running is a fairly long, capital intensive and technically complex process. There is no doubt that there is a substantial tin deposit down there, but getting to it is not the easiest task in the world. But at current tin prices, its certainly worth the risks and challenges, and the market will surely come around to that view in time if tin prices remain high, or rise further.
Perhaps a don't and am learning all the time ,so I take your comments on board with interest ,I know there's people who understand the fundamentals of mining and oil mining as well ,so I will watch and learn from others in future
Was tempted to just let this go... but I thought I'd bite...
Bubble; "RNS out great news permits secured and pumps getting ready"
What on earth has this RNS got to do with that? Its a statement saying the detailed NI43-101 report on the new mineral resource that was released to the market on the 9th June has been filed. It is not price sensitive, its of technical interest only really. The share price is on an upward trajectory due to positive tin and copper price movements, not due to this RNS.
Did you just read the last line below the template statement called "ABOUT CORNISH METALS". Which has been the same for every RNS in reference to South Crofty since the company IPOed?
Bubble; "Natnrg,those graphs tell you there's lots of rare minerals imho"
You've not seen any "graphs" telling you there are "lots of rare minerals."
This is a tin deposit, what "rare minerals" are there in the resource other than tin? You just seem to be talking a lot of rubbish really... and then posting "Strong Buy" next to it.
I'm not convinced you know what you are talking about at all, and I'd caution others to beware of meaningless ramping statements with no understanding or substance behind them.
LLInv: "Bubble, apologies for perhaps the silly question, but I had thought it was already known that the project was fully permitted? Or were those permits exclusive to United Downs?"
No don't worry LLInv, your understanding is correct. South Crofty has been fully permitted and the pumps delivered since well before it listed on AIM.
It is South Crofty which is fully permitted.
Bubble, apologies for perhaps the silly question, but I had thought it was already known that the project was fully permitted? Or were those permits exclusive to United Downs?
Market likes the news by looks of things this morning ,be interesting to see how they react on tsx
:D
You have read all that already? I’m only on the 20th page or something
RNS out great news permits secured and pumps getting ready