Firering Strategic Minerals: From explorer to producer. Watch the video here.
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Would appreciate the full text, if anyone has a subscription.
https://www.mining-journal.com/london-to-a-brick/opinion/4189775/newmont-kingmaker-future-solgold
I suppose the same argument could be applied to BHP.
I have it
1.
It's often difficult to pinpoint precisely why a company's share price moves up, a good example being that of London-listed SolGold whose stock price has spiked 26% in a month. The company, which owns the hugely prospective Cascabel/Alpala copper-gold concession in Ecuador has long been touted as a bid target.
In the past, the news has been less than bright, marked by boardroom rows and stakeholder disagreements, while, more recently, a state of emergency was declared in Ecuador, stemming from armed conflict that exploded between Latin American drugs cartels. There's no suggestion that a bid for SolGold is imminent, so market observers have been wondering what's behind the biggish uptick in the shares, although at 8p, they're still a long way off the 46p of seven years ago.
A number of theories are doing the rounds. One broker told this writer that for the first time in awhile, the phone has been ringing with calls from retail investors considering buying the stock, so perhaps there was an appetite for explorers with "standout assets".
2.
pdac
solgold had a good pdac, signing an investor protection agreement with the president, despite a continuation of nationwide curfews. at the convention, ecuador's president daniel noboa went out of his way to underline the country's continued commitment to foreign direct investment, especially in mining. collaboration with solgold and others represented "a significant commitment to the growth and sustainable development of the mining industry in ecuador", he said. solgold's share price has doubtless been helped by this year's increase in the copper price, but company specific factors have also played a role. a revised pre-feasibility study unveiled in february slashed development costs by $1bn. initial mine development, fi rst process plant module and infrastructure is now estimated at $1.55 billion, compared to $2.75 billion envisaged in april 2022.other good news has come with exploration results at adjacent blanca-nieves, 8km from cascabel;and potential investors are quietly please with boardroom stability brought by solgold's new ceoscott caldwell β appointed in march 2023 - who is now living in ecuador while he conducts a strategic review.
the result of that review could lead to a sale, partial sale or joint venture with one or more of the cornerstone investors, but caldwell isn't in a rush. like juniors everywhere he is keeping operation sticking over after slashing overheads to reduce cash burn and allay funding concerns. as things stand, the company has cash of close to $13m and treasury shares linked to last year's merger.
palmer steps in
what shape any m&a takes is a topic well-rehe****d, but a new theory is doing the rounds with market sources suggesting bhp's interest has dropped away and that newmont, under ceo tom palmer, is the likely kingmaker, perhaps via a jv with jiangxi. palmer is on the record as saying one of the main reasons for newmont's merger with newcrest was to expand the firm's copper portfolio. newmont gets about 10% of its revenue from copper following the takeover of newcrest, and that rises to 20% or more as it develops planned projects. roughly 30% of newmont's reserves are now in copper with palmer telling media recently: "you can expect the value of our copper assets to increase, and the importance of copper in our portfolio to grow. we have three big copper properties, one on png, one in peru and one in british columbia, all of
significant scale." one could ask how important solgold really is to newmont when palmer has plenty of opportunities
to allocate capital elsewhere (including copper), but it's probably too big a chance to pass up.
3.
Cascabel is viewed by Caldwell and his board as "a multigenerational asset, potentially one of the 20 largest copper-gold mines in South America". City broker Hannam said: "Newmont/Newcrest has previously indicated a desire to increase its copper exposure, while Newcrest's past success in Ecuador could also weigh in SolGold's favour with its 32% equity stake in Lundin Gold (owner of the giant Fruta del Norte gold mine in SE Ecuador) currently worth about two and a half times its initial investment."
For now, no-one seems in a rush to do anything, but that could change very quickly.
Cheers BBG
Atb
Cheers BBG, it would be great if Newmont and Jiangxi could make a move on solg before Trump start his second term with more anti-Chinese policies.
Obviously I am not happy to read that Scott is in no hurry. Clearly he is finding it hard to pull his nose away from the trough π
Trump won't get back in. But by running Biden, the democrats are giving him a bluudy good chance!
If only we had someone with the balls to stick it to the Chinese and stop immigration and end wokery
Thanks BBG good article
Eloro, why do you imagine he'd prefer to toil away at the coalface for another x number of years whilst earning a meagre 200k per annum when he could flog the company, trouser a multi-million dollar fortune and retire a happy man? He's 67, after all.
Sorry Fort, I am 100% certain that Trump will be the next president.
1984, too bad the Native Americans didn't have a robust immigration policy. If they had, they would still own their own country, rather than having it stolen from them!
Add, you forgot the tale of the dog with the bone π
That is our Scotty. He is in such a feeding frenzy at the trough, he lost track of the bigger prize of flogging the company! You know the damage that greed can do to people π
'Feeding frenzy', ha, ha! 200k versus millions. Don't be daft.
Thanks BBG. Interesting Newmont speculation. Question in a JV scenario is what % would SOLG retain? Or is the idea we flog Cascabel to the NMM and Jiangxi?
Add, maybe his meal is like an iceberg. We are only seeing the tip of it. Who knows what else is going on?
Like Fort pointed out, they might be trying to find a way to keep the Cornerstone shares, hence being in no rush. I just hope that this will be sorted this year. I cannot endure another year of the same.
Im also certain trump will get in and ice got a Β£5k payout coming if he does. Everybody sees what a mess Biden has made of America and how weak she now is
Weβre not stealing from Ecuador, weβre helping them build an industry they otherwise would never have. Itβs a win/win for all
If only somebody would bloody buy it!
Eloro, like what? Are you suggesting the company is failing to disclose his earnings properly?
I certainly agree with your final two sentences.
Incidentally, I see you're maintaining your perfect record of predicting the sp correctly. Please, please keep it up...it works wonders.
1984, you are funny π
The stolen land I was referring to is the land which was stolen and which eventually became the USA!! You don't actually believe that Powhatan gave up his land willingly to John Smith do you, and chucked in Pocahontas to sweeten the deal?π
No problem Add,
If my predictions can get the SP back up, then great. At least I am being more effective than Scott in that regard π
Securing funding at project level will force an interested party to move and acquire our company.
There is no way in hell that any major will let us put proceeds from the sale of Cascabel into our regional assets.
Twiggy has done it before and can very much replicate his success in Australia via Solgold in Ecuador.