Rainbow Rare Earths Phalaborwa project shaping up to be one of the lowest cost producers globally. Watch the video here.
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Decent volume for the canucks.
CGP up too.
Going nicely Fort
https://www.google.com/finance/quote/SOLG:TSE?sa=X&ved=2ahUKEwiA65ba5Kb7AhUOYsAKHW9wA40Q3ecFegQIDxAc
Colonel, I have it on very very good authority that the whole Aussie investment community dislike Newcrest.
The instos cos of the poor dividend and sp performance.
The research guys cos of the company’s arrogance.
The mining community because the BD team run the show and not the technical people.
No idea about Bhp, though Henry won’t endear himself to many, other than their own shareholders, cos they won’t pay up!
Jerry - how do you feel towards Newcrest now? You seemed happy to have them on board at GGP but I'm guessing that's changed recently after their stunt there?
An interesting comment from Mr Irwin:-
https://twitter.com/bigdude6669/status/1591153771484413953?s=46&t=ddOuVHaRXKUZiQ_eqNYt_g
He makes a good point.
I would imagine in the corporate world it is not the done thing, for a CEO to comment on the actions of another company. Even if they hold a small stake.
Is the CEO of BHP allowing his mouth to betray his thoughts
It's actually very embarrassing for Henry and BHP as majority of the city will say ...."disappointing high-cost" finance option vs what Mr Henry?? Vs an equity placing which sees BHP gain another 3%+ in a junior at a low cost?? And at what cost to 'all' shareholders is that Mr Henry?? Dilutive cash raises via the market that line Super Majors pockets with cheap shares is the way to go isn't it Mr Henry?? Well, perhaps it is the world class calibre of Alpala that makes getting a royalty deal done in the first place as there are many Juniors out there that can only dream about that and instead have to succumb to cheap placings.
What I dislike most is the arrogance of Henry and BHP. It's like he doesn't understand that bulk of shareholders do not want the high cost of dilution. And as we've discussed already, it's only high cost if you offered SOLG a better deal Mr Henry. It's just a shame that you couldn't say.... yeah well... look mate, we offered them $25m at 45p and they took the high cost royalty option or more like... yeah look mate... we offered them $25m at 18p so I guess they took the right option with the royalty deal.
If I were Lasso, I would be thinking about other players like Fortescue and Rio or Anglo as potential partners in Ecuadors mining future. Not some arrogant self interested tools like BHP.
11.18% up on the week - I'll take that. Copper on a good run too... let's get some more positive RNS's out next week which you've been sat on for ages Solg to keep this momentum going.
Thanks for bobbing in Daryl, Scott... I hope you brought a For Sale sign to your first day at work?
Have a lovely weekend ladies and gents. C
Is anyone going to mention the elephant in the room this evening ?
Yes, Nellie is sat in my living room making a trunk call on my phone.
Do you mean the slug in the room NoviceHunter?
No Novice, let's not
How about we try this, this weekend. Let's show everyone how grown up we are and not start a needless argument?
It will be a first but lets give it a go.
I do not have access to this article but it seems to express a popular opinion:-
https://www.mining-journal.com/m-amp-a/news/1443202/maxit-bhp-and-newcrest-can-go-k-themselves
leave the guy alone. Pretty good insight , lots here liked the input.
Novice is just angry and bored and wants to cause drama and disruption for the board thats all...
Covgaz - he's just asked if BHP are a "cornered rat". Yet you like that analysis?
You and 13 others. It's ridiculous. Cornered rat my hole.
It's going to be pretty interesting to see the reaction on this board if the strategic review doesn't yield the outcome plenty on here want, and with SolGold hiving off future profits in favour of cash up front, it's more likely SOLG will be the cornered rat, as we have been for much of this calendar year. Only next time we'll end up flogging a stake in Cascabel to someone like Mitsui for much less than fair value.
There's not much thought going on in terms of what impacts our actions now can have on our future outcome. Everyone just seems to think it'll be an easy sell, as they have for the last 5 years. Well we're still here, unsold and propping ourselves up with deals that have prompted war across the boardroom table.
That isn't something to crow about.
Cornered rat, my hole, sounds like a film I once saw….
Bozi ignore him I've filtered him
RichBetter - it's hard to say with certainty given the strategic review taking place rignt now. I think all options and proposals have to be considered.
I'm not against anything. I would have a preference for the company still having control of it's assets coming through the other side of the forecasted downturn because that is when copper prices will start to bite as you say and that is when SolGold will be at it's most valuable. It'll be transformed from where we are now at 18p/£420m anyway and there will be a buegeoning spot price to support it.
However, if we have to move Cascabel on in 2023 and there's both a decent offer on the table and a way to mitigate an excessive tax take then it's going to be worth looking at. I think there's some merit in sellimg Cascabel off, letting an acquirer buy back as much of the royalty deals as they can. SOLG then starts developing Porvenir and exploring the regionals with half the loot (other half back to shareholders via a special dividend.
That should give holders a nice cash kicker and it should provide some sort of exit from the stock for those who want it.
I'd then be looking to Porvenir as an asset where SOLG can become a producer in their own right. It makes much more sense than Cascabel. The regional work would involve capitalising the 4 subsidiaries and setting them to task to find the nest top assets.
Nice insightful summary.
RichBetter - I actually don't disagree with much of that, until the last bit anyway. Cash is an ongoing issue now and in my view, SOLG needs to use a hybrid solution. That hasn't really been an option in recent weeks but it should have been earlier in the year when the SP was close to 40p and investors were awake to this at the time.
The problem with just relying on royalty is that it's eroding away at the profitability of the project it's secured against and the size and scale of Cascabel means that the streamer is getting an even better deal. Look at FNV with their 1% of future profits. If Cascabel needs total EBITDA over LOM of £10bn for them to get their capital back. I'm sure the base case assumptions are 1.5-2x that and if our basket prices move higher again there's really no ceiling on how much they'll receive back. I don't think it's inconceivable they see £400-600m. So the point I want to make, is given the sheer size of Cascabel, why 0.75 or 0.8% wasn't a fairer deal?
If for example, we do a PEA on Porvenir and it shows a smaller tonnage project (as we know) but with an IRR of 30-35% then I think there's more scope for a royalty deal or two, but with Cascabel a shade under 20% post tax we do have to be very careful.
Completely agree about what SOLG have created for BHP in Ecuador. Have made the same point before.
I'm aware of just how long the merger took to achieve ;-). It wasn't straightforward given the years of acrimony and whilst Darryl. Might not have been the top dog to many, I do respect him for his role in getting that done.
BHP always has a say. They're awash with cash. They can compete and better anyone. It's in their hands, but I do think that if SOLG goes too heavy on royalty at Cascabel they won't just force BHP to step aside bit everyone else too.
Bozi...you do sometimes post unsubstantiated rubbish...
Stick to the facts...
The strategic review is a smokescreen for a sale of SOLG or Cascabel...
RichBetter...we're out of cash now...?!
What planet are you on?
$50m cash raise plus probably $20m left gives enough to last until end 2023 or beyond at $3m burn per month, even if we do more drilling...
But we won't need it because this is being sold...