Rainbow Rare Earths Phalaborwa project shaping up to be one of the lowest cost producers globally. Watch the video here.
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Agree. What a stat to quote. Especially in Aus near infrastructure. And open pittabke.
"Andrew - you should volunteer to take on the PR for XTR!"
Thanks but Andy Mills has got that covered :)
If I worked with CB, I suspect we would have some "professional disagreements" on the best way to promote the company and what should and shouldnt be said in interviews:)
Andrew’s research earlier today revealed that Bushranger at 1.1MT is the 9th largest copper discovery in the last 10 years - in the world! What a missed opportunity from a PR viewpoint! If this had been front and centre in the RNS and Colin’s podcast, then the SP may not have sunk so low - even with the disappointment of not making 2MT. Andrew - you should volunteer to take on the PR for XTR!
Still think its premature to discuss a sale. Don’t think they have ruled out further drilling yet.
CB is cunning, he has only said they are not going to spend more money on trying to get to 2mt, and the DtM is the best option to spend shareholders money.
But, bear in mind the DtM only has to ‘potentially’ be based on a very small mining operation on a small portion of the overall resource at RC as the agreement is not specific in throughput to satisfy the agreement to engage AA’s response. It also doesn’t need infrastructure or processing capabilities so there is no huge capital outlay to fund. Plans could be for a small starter pit mine that will haul the ore off site to sell to a nearby plant.
So worst case some more definition drilling relative to the DtM. He also commented that “the 1.1 would maybe grow to 1.3mt when we make the circle a bit bigger with the opportunities that are there.” Indicating further drilling.
So if this is the way then that 3rd phase to test further the other highlighted areas could be on.
A JORC is normally updated at certain points to understand what to do next and what programs of work are required to reach the next key decision point. It wouldn’t just be a case of sticking a few more holes in, it doesn’t work like that wether you are resource building to sell on or a company is building the resource toward the actual mining and extraction process. There are contractual obligations to consider with drillers and supporting staff.
With the broader scope now that a 3rd drilling phase could reveal, and at $250 per metre drilling costs and a maximum realistic drill of 2,000m per month that would require about $500,000 per month for, say 4 months minimum then another 3-4 months assays and modelling. so about $2m plus other costs associated for a further drilling phase and another 9 or so months . It potentially won’t be that bad and will add value throughout a period where nothing is likely to happen anyway as we wait for copper to climb.
I'd assume taxes are pretty low. No doubt they will have top accounts 'manipulating' the books to keep them minimal...
So, prospects still very good but we may have to wait another year.....lyrics are spookily accurate for Xtract SH's :)
https://www.youtube.com/watch?v=-b3XTj5G_SA
What do we know ? We have 500Mt rock giving 1.1mT Cu Eq giving an in ground value of around $8billion (using $7300/ton).
That gives a mine life of 20 years at 25mT/year throughput. Colin says that will give 200million/year revenue (assume $).
So the 8 billion in ground gives 20 years x 200m = 4 billion revenue over the 20 years. Apart from taxes, what else is to come off that 4billion revenue ? I assume the 4billion already taken off is the capital cost of setting up the mine plus the fixed annual operating costs. Colin says the higher grade cap could be mined first and that would payoff the initial mine build after a few years. Obviously we dont have the ability to build a mine and the AA 80:20 would mean we would have to fund 20% of the mine build which assuming 1 billion would be approx 200million. So that is a no go (FB was a good deal as we got a 80:20 arrangement without having to put up 20% of the build costs). Without the AA 80:20 we could accept a 0.75% royalty I believe instead. Is that 0.75% of the 200million per annum revenue ? If so that would be approx 1.5million/year (way less than the FB deal should be giving us).
Which takes us back to the outright sale. Basically we would be selling on a 200million annual revenue (assume $). What would that be worth... any guesses ?
Thanks Andrew that report puts things into perspective
Butlerman, you took the words right out of my mouth! Make no mistake, even at 1.1m this is a big copper discovery on the global stage (thanks for the stats, Andrew) but, the thing is, it’s only going to get bigger. Big Mining is already well aware of the developing Bushranger story, and will be following it closely. I suspect strongly that Colin will have no shortage of suitors beating a path to his door, with their chequebook wide open. There’s an oft-used phrase which is quite apt here: “he who hesitates is lost”. Big Mining simply cannot afford to run the risk of dithering, or trying to get Bushranger on the cheap…..thus missing out on (potentially) the opportunity of a lifetime.
Now that I’ve had time to reflect on this week’s events, I really don’t feel too distraught. I was clearly very disappointed that we didn’t get closer to Colin’s oft touted 2Mt, but we have 1.1Mt, accessible by open pit, in a very friendly mining country, close to power and infrastructure. With higher grade near the surface. I know the economics can’t be fully determined until the open pit model is released, but with the information we have, and even before Ascot, this share has been considerably de-risked, in my opinion. Sentiment may remain low, for some time, keeping the share price low, as result of the expectation disappointment, but the SP will surely recover over time, as the pit model is released and a buyer is found. So, now this is a medium to long term hold, for me ( 3 - 9 months). I won’t be buying more, as I’m quite heavily invested, but I won’t be selling either.
The last few days have caused most of us to age considerably more than a few months!
Obviously the article is a few months old now...
"Goldman Sachs forecasts that the benchmark London Metal Exchange price will almost double to an annual average of $15,000 a ton in 2025. On Wednesday, copper settled at $7,690 a ton on the LME."
Let's hope so, thing is would a company risk buying us out near term or will they wait? - A couple of years could be saved on detailed plant planning and build buying now, would a big company risk it? - I guess ~£100/150m is not a big amount for a multi billion $ company.
REf:https://www.livemint.com/market/commodities/why-copper-prices-can-t-remain-at-historic-low-explained-11663805226402.html
Would there be any scope in starting off with a smaller plant set up to mine the 'high-grade' near surface ore and then ramp-up over the years. Or even just to mine the high grade portion?
A4444 - Could you contact Charlie Zzzz on telegram if you are interested in supporting his letter to CB re: no more acquisitions.
I agree.
The worst case scenario here IMHO is that we may need to "land bank" this asset until POC moves higher. I'm not saying that will need to happen but if it does then we may have to wait a year longer then expected.
Obviously some will then sell and move on but the 1.1mt is not going anywhere . We will have the FB money to more than just keep the lights on so no need for any raises. Just wait for POC to rise as it definitely will do.
Btw, this is the joint 9th biggest copper discovery in the world over the last 10 years. Just our near surface 0.6Mt is the 12th biggest discovery in the world over last 10 years.
See page 8 of link
https://app.sharelinktechnologies.com/announcement/asx/9bfddbc86ca010b468d54a28391fcc78
The line that BR could be uneconomic is a false one that needs to be put to bed. The question is really “at what price of copper does BR become economic?”. We know from earlier modelling that RC pays back the initial capex and produces >$200m NPV at $5/lb. That was based on the original JORC’d resource. We now know that the high grade crown contains more copper-equivalent material than that, at least another 0.1Mt worth >$1bn revenue - again at $5/lb. That’s before you consider the remaining low grade 0.5Mt that would be mined from year 11 onwards. So, very clearly, BR will produce a positive NPV at $5/lb - possibly a very attractive one. The question is then, what about at lower prices? And will the economics be sufficient to attract a buyer?
AIM exploration/mining is on the floor and there are too many companies that will fail. I don't think XTR will fail and from the research I've done lately could still be massive. I am not invested here yet due to having big positions in 2 other AIM Explorer's who like XTR are well undervalued. Yes, the 1.1 million is disappointing, your CEO was too optimistic and 2 million would probably have seen XTR SP go through the roof but you still have some very good assets and copper IMO is going to be in demand for at least a decade or more.
>>>Howezap, My fear is that the final set of results from Ascot showed a certain lack of copper for a proposed copper mine <<
Hi Eastern investor you’ve got to remember Ascot is relatively untested but does have more precious metals than RC with decent grade. Copper is extensive, and over a km of strike in 3 mineralised zones but it will be the gold that will have significant positive economic benefits for Ascot. It’s a shame they could not have drilled a couple or three more holes in phase 2 to extend shallower intersections of gold.
A second pit at Ascot will not have to carry the CapEx for plant and infrastructure as RC could cover that initial stage.
Due to the different mineralisation types between the two deposits I’m guessing that grade control and stockpiling of ore type and grade will be important if both mines were to share a central processing plant. Will have to look into that.
The Podcast being disappointing is a gross understatement. I’d go so far as to say it continues to add to the deceit and delusion. “Bushranger has achieved everything we wanted it to achieve and more Zak”. The guy completely lacks any sense of integrity or is completely deluded as to the extend he has been stringing investors along with previous comments.
Prickly, this one https://www.youtube.com/watch?v=iWwCu3DnatU
I know it's against Colin's religion but now manica is finally producing would it not restore credibility and the sp if xtr was a dividend paying company say 5% . Or am I delusioned fantasist.
"...and why the situation has been allowed to drift without any indication that mining prospects were not nearly as good as we had anticipated"
Because thats classic "Colin keeping not so good news back". He would have known we were barely reaching 1mT but was probably hoping Ascot would have got us nearer. Many feel totally let down here.
Well said prickly.
I also contacted the Roast boys to see if this would be something they could organise. I know we've had one in the past but I can't recall how the company went about it?!