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Spec - as I've said to Helpful, ALR/RRR now need to start putting news out to market (Zim elections are done) on exactly this sort of stuff what tonnage/grade they plan to export/what is comfortably achievable, they need to guide - ALR/RRR should do something together as Bell isn't the best presenter, maybe Dirk and others can assist him, also introduce the contract miner on ground when appointed - I agree with you this is the model most likely Chinese Offtake/Contract Miner/Partner. We have First Equities report to go on but the inputs for that were for a 5k tonne per month operation selling into local market so thats almost redundant since we are looking at a much bigger operation straight away. Bell alluded to the fact that the visiting partner geologist and ALR's geologist both felt that the deposit was materially bigger - so since they've decided to go for the bigger export market due to Zim law changes we could do with updated PR presentation coming from ALR/RRR and via RNS on whether this is a 5k tonne per month operation or even bigger now. We can then get updated broker target from FEQ on this.
PREM MARU are good at the PR/Newsflow side, ALR/RRR need to get on it and feed the market. If those samples are being bagged for Chinese buyers lets get some snaps with that detail. You should see the PREM MARU twitter feed. Brewer and Roach are non stop.
How big is "Tin Hil" represents the problem in both buying and selling. There has not been enough work on the property to really know. Consultants on the ground will have 'feel' but ultimately there is no geological model that say xxxx tonnes at y% grade.
For a variety of reasons, including the unknown, IMO the most likely approach is a Chinese offtake coupled with 3rd party mining. This deal (or really any type of deal) would be very significant for ALR/RRR
Maybe, maybe not. They are just as likely to get a bid from the parties they are talking to; look at Prem and Prospect. In effect Canmax farmed in using the offtake agreement and funding as leverage.
The question is, at what price is AB likely to sell?
I have been looking at earlier offtake agreements agreed since 2019; most were done at much lower lithium prices. When the Prospect deal was agreed the lithium price was much lower and they used a much lower price for the modelling the DCF.
My view is that he would want to sell if anything between $50m and $100mil was on the table. The reality is that any deal would be at a huge discount to the DCF: no idea where the line should be drawn for fair value.
If what ALR says about Tin Hill is true then there is possibly 12+ times lithium in place compared to the model prepared by First Equity. Marginality means that the extra volume is more profitable because the fixed costs of preparing the site already in for the first First Equity calculations. Possibly more CAPEX would be required whether we mine in-house or appoint a contract miner.
IMHO with hindsight both Prem and Prospect did their deals too cheaply. But......timing, we can't control timing.
Brian Gilbertson who AB lurves, used to say to him, "in mining, if you want to be become more profitable, you get bigger" what that is referring to is the marginality of production. The fixed costs and the capex is spread over more units of production and so the marginal profits are greater. Tin Hill is a lot bigger than AB and ALR/RRR thought a few weeks ago.
DYOR
All about how quickly they execute these binding terms now and get info and pr out. That'll be the measure for anyone getting in/averaging down now.
So keep it simple everyone knows Andrew Bell is marmite like George Roach/Jason Brewer/Bernard Aylward were but they are delivering so I never right anything off at the right price and this is sat at all time lows again (after a spectacular run in 2020 from this exact price 0.16 to 1.20) and Lithium is a rising tide thats lifting all boats - so the equation is a simple one - they get binding terms with 'chinese buyers' and the 'contract miner/partner' and it can't stay sub £4m mcap. Even now it's far too undervalued, I have feeling the market will catch on fast as there aren't any Lithium projects at this mkt cap this close to production and cash flows. We also have ex TR1 holders like poster 'Longterm' starting to position again and additionally William Black increasing to 3.30%. I'm seeing all the right players gathering again.
At ALR they previously modelled a 5k tonne per month operation at Tin Hill based on 2% grade selling at $250 a tonne supplying to local market and came out with a $10.7m per annum in pre tax net cash flows - but based on Friday 18th August RNS they will now export which they get much higher pricing, based on same tonnage at > 3% grading @ $1500 a tonne they can get $7.5m per month ($90m per annum, 50% of this to RRR) - theres 4 of these licences (if you extrapolate across all 4 then its $360m per annum), they have EIA clearance for Tin Hill and can proceed to export from there to begin - Exact pricing/offtake terms are to be agreed. There is stock pile present to.
Atb
Sampling. Some people will say anything to make it look like RRR has a problem.
Three types of samping really, used for different purposes.
ALR has already sampled the outcrops in Peg 1, has sampled the stockpile at surface so why sample again? Well an off taker wants bulk samples taken at intervals and wants it done under supervision. Sending the samples to two labs ensures a degree of confirmation. What should happen is that both labs come back with broadly similar results.
Grade, we already know that at least some of the grades are in excess of 3% from previous sampling.
The new sampling will involve trenching at intervals. So it is a much bigger job with a greater volume of material sent for sampling.
I don't know this but the testing of the samples might be more detailed in that it wants to confirm metallurgy and contaminants.
But nonetheless, everyone should take our resident "experts" at face value.
DYOR
You don't talk to Chinese buyers or Contract Miners/Partners if you aren't suitably advanced, as per RNS:
"Discussion has begun with sales agents in China for sale of lithium ores, and a potential contract miner/partner has sent an experienced South African consultant geologist who from 10th to 14th August with ALR personnel conducted due diligence at ALR's locations in Zimbabwe."
Banbury - first of all Zimbabwe is one of the hottest lithium destinations on the planet at the moment - they're the top lithium producer in Africa - they've come a long way, it is literally the place to be and all are flocking there, AIM listed PREM is there and they tagged £200m+ at there peak, MARU, GLR, Prospect Resources (sold one of there lithium assets for +$400m) and many many others are there. China is locking in as much supply as it can get and already controls much of it whilst western governments do lecture tours lol. So we'll agree to disagree about Zimbabwe. The election is done and out of the way.
As I said, RRR's Lithium asset is my primary reason for being positioned it alone is a company maker without anything else. The key now is for ALR to keep the pressure on Bell to stay focused and see it over the line. We are now in discussions with chinese buyers and a potential contract miner/partner - these go binding and its game time as theres a real operation the market can behind. You have a confirmed buyer then with pricing terms and a mechanism by which to get your product to them and thats cash flows. £3.9m mcap looks ridiculous then it has to move beyond £20m easily.
Re DRC cash $7.5m - lets see, in his StockBox interview Monday/Tuesday he said he wanted to be in Zimbabwe but felt he could get a call any moment to fly to DRC to be in the bank - like to think he was basing that on something happening very imminently otherwise he'd just fly to Zimbabwe.
Re EO IPO i've never really mentioned it but it is currently due to list on 06th September and it is worth $1.5m - $2m to RRR. Lets see if it goes ahead. In the same way i've not mentioned the Kenyan Tailings & JV potential and the arrangment they have with POW on the Australian gold licences and all the other sum of parts - market won't value these until theres an inflection point.
Regards finances - I don't see anything 'dodgy' or 'mates rates' - I can see the CLN with Riverfort and Diversified metals was settled in June which is great - i can see the private funders of ALR had there loan notes repriced from 0.60 to 0.20 which is at a 30% premium to current price. They could have had them repriced at 0.10 and/or called them in completely but didn't. As for cash they raised +£800k about 2 to 3 months back after cleaning up Rivertfort and Diversified for working cap so should be ok.
I like the risk v reward from here and i'm aware of Bell. Lets see if he can pull of another 2020 home run.
When i look again at the stockbox interview, i concluded not a lot as been done. He said this at the end of the Zimbabwe part of the interview:
Interviewer: "And when would you hope to be able to make a more concrete announcement as to the next steps?"
Andrew Bell: "Um well we, I think what we do now is we get some representative samples from what we've established about the deposits. We'll get them probably sampled by a local lab and maybe we'll get one sent down as a check to SGS in South Africa; and this is what we'll show the Chinese; and off the back of that perhaps we can have a contract for a certain volume over a certain period"
Trade I think unlike Helpful you are genuinely balanced. I agree on too many plates and think Lithium has potential but recent election coverage on Zimbabwe shows its not the safest place to do business.
Where I think you are far too optimistic is DRC and EO. The former is unlikely to happen and Bell is just spinning the yarn to fund raise the later looks hugely over valued and the IPO has been pulled numerous times its a case of join the dots on that one.
On balance given the above and the Bell factor - mates rates / hidden loans / dodgy dealing you will be lucky to see 0.3p again.
I said that to Spec months ago when he averaged down. The drift in the SP is saying wake up and smell the coffee.
Https://twitter.com/robert_ivanhoe/status/1695815973952221594?s=20
DYOR
Any thoughts on who the "potential contract miner/partner" is?
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
"Discussion has begun with sales agents in China for sale of lithium ores, and a potential contract miner/partner has sent an experienced South African consultant geologist who from 10th to 14th August with ALR personnel conducted due diligence at ALR's locations in Zimbabwe."
Https://www.semafor.com/article/08/26/2023/zimbabwe-election-won-by-president-mnangagwa
DYOR
it actually has been a ****e investment for anyone that hasn't timed there entry and exit right that i do agree with. that said there have been opportunities to make considerable returns timing it right, for me that's now at £3.9m mcap sitting near all time lows where the downside risk is fairly limited - i can't speak for anyone else but i'm positioned purely for the lithium asset moving to cash flows now and to a lesser degree a good outcome on the drc funds. if this was a single asset company listing today with a fully permitted lithium licence moving to export it would not be listing at £3.9m it'd be more like 50m+ mcap like a ctl kod prem or something, partly why i think maru should be a lot higher than £17m mcap - i think that will get there before long and more so when it comes onto aim. so alr is a company maker for rrr. its just the right commodity at the right time in the right postcode.
anyway i'm giving him bell a window now to move to binding terms with the chinese and contract miner/partner and i think you're looking at a move towards £20m mcap and beyond if this happens fairly rapidly now. not going to give him a huge amount of time as it shouldn't take all that long to start putting out some key announcements out and thats my way of making sure it hasn't drifted down the priority list.
if he doesn't f'k it up and get distracted the upside is far far bigger than 2020 (0.16 to 1.20).
all the other stuff eo ipo, australian ipo, kenya, burkino faso, ivory coast and whatever else if they come in great but its not why i'm positioned here and now. part of the problem with bell is spinning too many plates, he seems quite focused right now, alr boys need to keep the pressure on.
atb
Well, how is your investment here going , drop after drop . Good investment that 🤣🤣🤣
Manchester or Salford same Shiite hole
JR so your advice is to buy AFTER results are in and AFTER all facts are known. curious as to what kind of investment results you get with that kind of approach.
On this side Investors look forward, assess the risk and then investment accordingly. Personbally I have gotten 10x on multiple occasions and my ultimate home run was getting in very early on Diamond Fields- big shout out to Bob for that one
Get back to your Buckfast Breakfast.
I am not from Salford you socialist plonker.
Yeah yeah the Salford clown 🤡 you and your cronies trying to sucker people into this Shiite show. All I’m trying to do is get people to look at the history of fund raises and promises which never materialise
Https://www.drive.com.au/news/electric-car-boom-risks-causing-shortage-of-medicine/
Sounds dangerously close to making an investment recommendation Lomax. It almost sounds like you don't want the share price to go up because you haven't bought back in yet and therefore won't make your £300 on the turn.
Temper temper Jrlomax. All pre revenue companies raise at one time or another BUT:
Aside from what we know is expected 'imminently' so to speak - DRC cash ($7.5m) + $1.5m-$2m from EO IPO 06th Sept.
On 21st June they raised £236,032.38 + £60k of own cash to settle the CLN & Debt coversions which were killing the price with Riverfort & Diversified Metals.
On 11 May 2023 they raised £535,840 & a further £288,750 on 22nd June for working cap.
Thats a total of £824,590 for working capital.
Think we're good for a bit. Shouldn't have burnt through circa +£800k in 3 months.
Regards mining & processing equipment that is exactly why the contract miner/potential partner/chinese offtake discussions have been started - this will be agreed at project level, not RRR equity, similar to MARU.
Up yours you tool tradepest. You think they are not going to raise money, get a fooking grip , £100,000 ain’t gonna buy mining equipment and processing equipment is it. Anyone reading this DO NOT listen to these fools, helpless is praying his large investment comes good and tradepest is a tool. There is no money coming from the Congo. The Chinese may or may not come over the hill. Do not buy the rumour.