Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Steve - without having see the detail of your workings I can't be absolutely sure, but your analysis is probably flawed in a number of respects. For one, there clearly is additional higher grade copper-equivalent in a near-surface area, even if only a little over 0.1Mt. The strip ratio also reduces significantly when considering the whole resource (and to indicate this, just try calculating the volume of a pit, or equivalent cone/hemisphere of the expected size). Third, unit production costs do reduce as the mill size increases, which is pertinent to CB's comment about increasing the mill size to 25Mt pa. So opex clearly does change in a positive way. Fourth, FX rates have changed since July 2021 and - if part of this change can be considered permanent - will have a meaningful positive impact on the financials. Fifth, you don't know what work has been done by XTR and their advisors on the basic model assumptions used in July 2021 - from memory they were based on assumptions used by Boda (a CB reference), and I'd be surprised if they haven't been refined by then. There is much optimisation that can be done. And even if the low grade material is not particularly valuable, the higher margin crown does generate a positive NPV on certain conditions that are entirely consistent with long-term trends - and which would be enhanced by something similar at Ascot (or indeed other outcrops that have been identified by the XTR team). There are so many reasons why your analysis should not have been presented on this forum as an "accurate" summary of the status quo.
I also feel tempted to say - what on earth were you thinking? What were you hoping to achieve? Were you trying to be helpful? Do you feel you've been helpful? You've single handedly caused a disorderly market by spooking many investors here who may not be as numerate as you and are now worried and thinking is he right? Is he wrong? Well he's a Director of Analytics, maybe he is right. There are probably many here who have been thinking through the implications of the RNS, their own response to it and what they should do, and maybe now feel even more confused than before. But you're alright aren't you, you sold out before your "helpful intervention". You've just dropped a bomb in the room and walked away. Well done.
Grenade throwing has certainly caused a distraction here. With good timing of the Ascot news and the FB revenue news I still think 10p is on, but Colin has to convince the market he is not being deceitful in what and how he passes on any information in RNS and interviews.
"Now that the updated Racecourse Mineral Resource estimate has been completed, we are working on the maiden Mineral Resource for the Ascot Prospect, which we expect will significantly increase the overall mineral inventory on the Bushranger Project. "
This was in an RNS so not CB's usual BS. Ascot is expected to significantly increase mineral inventory.
I'll wait for that to be added to the economic model, completed by independent experienced professionals using bespoke software programmes before coming to any premature conclusion.
Andreww, that's Steve4407 job!!!!! Why didn't you tell us that fact Steve?
Let’s look at the worst than could happen (in my opinion)
Current market cap is £18m. This is supported by Manica revenue alone come early ‘23! So, even if we could only sell Racecourse as a ‘porphyry prospect’ for someone else to drill out further, based on our discoveries to date, for £40m, then we are looking at a SP x3 from where we are at now!
I don’t know enough to challenge Steve’s paper. But even if he is correct, the SP surely has more upside than downside now. And, in my opinion, the current SP represents a great buying opportunity for anyone having sold out on the way down. (Maybe Steve will buy back in again?)
Best lie low for a bit Steve, instead of continuing to justify your actions. Of course, you have a right as any to share your findings, but in light of todays significant drop and the fact that you have sold up before releasing it. You are not helping the situation.
Are you a smart ar5e with a Funked up moral compass?
I don’t believe you are for one minute, but it’s how you are maybe coming across to others.
You’ve sold up and shared you reasons for doing so. Leave it there Steve.
Seems hell bent on getting his message over for some obscure reason. Highly commendable or manipulative.
Steve is one of those pesky MMs isn't he...
Some more facts...
circa 58% sells v 42% buys..but down 17.5%
1.6% of total holders sold..so 98.4% didnt sell.
>> Steve - In your calculation you make the assumption that "operational expenditure (opex) is pro-rata for the ore tonnage mined". But you can't assume that. For starters, all the new ore that has been discovered within that boundaries of that first conceptual open pit, is going to be recovered without any increase in the cost of digging the hole isn't it?
When you say "All that new ore" - most of it was in the original conceptual study, which was 470,000 tons at 0.29%, using a 0.15% cut-off. At the same cut-off, the new JORC has only added an extra 235,000 tons at 0.135%. The original study did not include any scenarios below 0.15% except at 0% cut-off, so we don't know how much of the 'new' ore between 0.15% and 0.1% cut-off was already in the original JORC and therefore the original model.
The new JORC also covers a much larger area than the old one (see link) and we also know that for 0.15% cut-off comparison, the amount of ore to be processed will be double (336mt vs 162mt).
https://www.rns-pdf.londonstockexchange.com/rns/2677H_1-2022-11-22.pdf
I'm not pretending to be an expert on open pit design. I have presented all my numbers and my assumptions. The key for me is the JORC comparison and that is just reading the RNS with no expertise needed beyond basic maths. If you want to go into the detail of the high level model and believe my opex assumptions are substantially incorrect, or maybe it will take less than a year to build the mine and reach full production, then plug your own numbers into the model and see what works. The alternative is to trust what is being said in interviews.
As you say though, we won't know for certain until we see the official model.
Necesity is the mother of invention.
Gold and Copper, what's not to like.
Staring us in the face
https://fortune.com/2022/11/27/mining-industry-startup-jetti-resources-solution-copper-problem-shortage-bhp-freeport/
Regardless of the merits, or not, of Steve’s paper, I think we need to wait for the mining study/ pit model to be released to determine whether or not Steve is correct. I doubt this can be brought forward, so we won’t know until Jan/Feb. In the meantime we know Manica gold revenues are ramping up, and once we get to full commercial production shortly, this will suppprt a SP of 2-3p on its own. (I don’t think Q2 Gold figures will be that encouraging, as the plant was still being charged). So, maybe a rough few weeks SP wise, but to my mind, even if Racecourse isn’t viable (and that has yet to be proven by the pit model) it has got to settle around 3p by Jan/Feb. And possibly a lot higher if the pit model proves it is commercial. So, in my opinion, the SP has limited downside from here, if I look at it over a 2 month period. Volatility May force it down in the next week or two, but I’m comfortable holding, and waiting for the pit model.
Whatever this is, Cela is most certainly in on it too, the phrase "the lady doth protest too much, methinks" comes to mind!
Steve is probably that Tom Winnifrith guy
"Steve" probably is Colin...
As an investor you have to have an open mind to every possibility good or bad but how can anybody dismiss Steve when you look how much effort he has put into his findings and basically he’s got your back if it turns out to be true but people should wait for Colin’s response before trashing this guy that might of just helped everyone on here , the ball is in Colin’s court to put the record straight he will of witnessed what has taken place today I’m sure so patiently I’m waiting for a response.
One interpretation shows that negative conclusion. That interpretation makes some false assumptions.
I thought the same Matty. Does it have to hit a certain figure over a length of time to be actioned?
Absolutely not but when it’s backed up with real figures taken of Xtract themselves and shows BR basically has no economic value at present , I then would expect a response plus -20 percent on the share price
No O worries just a lot getting the pressie cash ready for xmas
One thing he has got right though. Is trash the sp even more.
All for good of ?
Steve - In your calculation you make the assumption that "operational expenditure (opex) is pro-rata for the ore tonnage mined". But you can't assume that. For starters, all the new ore that has been discovered within that boundaries of that first conceptual open pit, is going to be recovered without any increase in the cost of digging the hole isn't it?
Without knowing exactly where the new ore is sitting and at what grade, how the pit design might change and what it all means in terms of strip ratio, how can you even begin to assess the economics? IMO you simple don't have the data, tools, experience or skills to make the claim you have. I have always respected and appreciated your contribution to this BB but I think you've got this one wrong.
Do you expect Colin to issue RNS about every single post on this board, Cela?
Oh come on… so if you only post on 1 share your a deramper. But… if you are seen to ramp the share and de ramp the share you can’t be trusted at all?
Would it not make sense to praise the share when news is good and be negative when it’s bad? I mean wow. Conspiracy theorists.