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ZM, I doubt very much AA would, officially, be privy to such info. Wouldn't that, effectively, breach insider trading rules.
Well laid out post ZM. I would agree is likely AA will be privy to the financial model supporting the pit concept once it is designed before the market is shown details. I think the question is, when to now time the release of JORC resource statements. They are expected to be finished anytime now to into November. Maybe this timeframe is for the conceptual study to be completed too?
The company that will design the pit will need the (rc) JORC to complete their work along with xtract completing the financial evaluation aspect. Other than that it’s down to guesswork still as to when the party starts. With the market maybe having an influence on that.
It was thinking of the timescales required to update, or recreate, the conceptual pit model that led me to the previous post.
I have no doubt this model is complicated, but it will be a computerised model and the many inputs will have largely been known for some time. Very little new data (the last of the assays) has had to be waited for.
Therefore my assumption is that the updated conceptual pit model is already completed, the Decision to Mine could be published at any time, but the the 'end of October, early November' comments from Colin Bird are allowing time for discussions with AA.
I am intigued to know what the process is. Is XTR obligated to share the Decision to Mine report with the market concurrently with sharing it with potential buyers (i.e. AA at this stage)? Or can negotiations take place away from public scrutiny? I am wondering if the first we hear of the D2M might be accompanied by an offer (or decline to offer) from AA.
What is the real news? The Decision to Mine? ... which in fact means decision that the mine would be economical to mine, not a statement that the owner (XTR) has decided to go ahead and mine it themselves).
Or is the real news that AA has offered to buy back ProspectOre, and therefore all of its assets, for 'X' amount.
My uninformed 'gut' feeling is that a rerated SP following a public announcement of the D2M would not really influence negotiations as AA will make their own mind up what the asset is worth to them and also what they believe XTR will accept for it.
Similarly I cannot reasonably accept that XTR will wait to publicly annound the D2M and then pick up the phone to enter into talks with AA. Given that AA have this contractual 'first dibs' privilege (I feel this almost puts them in the position of a business partner) I am assuming that there is nothing underhand about sharing all data with them in advance of formerly publishing the D2M.
I don't know if this is the case, but my guess is that representatives of the majority of shares in XTR could sit around a table, so the deal could, and maybe should, be thrashed out in private.
Any thoughts out there?
Do we have an estimate on when negotiations have started or roughly about to start, time is dragging on give us our money!
>> I was under the impression that ProspectOre is an Australian subsidiary of XTR , with the asset being the project not the company
XTR bought ProspectOre in 2020, along with the licences. The original buyback agreement was in 2017 between AA and ProspectOre and we inherited that along with ProspectOre. If we sell, it makes sense to sell the company that owns everything (ProspectOre) rather than the individual assets.
johnswan1 - We can lower the cut-off because copper prices, and more efficient mining techniques, mean dirt that would previously have been overburden waste, is now pay dirt. To say it makes no difference to the value is simply not true.
And when you reduce the cut-off the estimate for contained copper isn't based on a random opinion or belief... it is maths. Reducing the cut-off to 0.15%, based on the existing JORC, gives us just shy of 0.5mt of Cu Eq. We more than double the resource without include anything discovered by the drill holes of phases 1 & 2!
AA were interest enough in Bushranger (despite deciding to prioritise other targets) to put in a buy-back clause and at the time the grades where hardly any higher and the price of copper a fraction of what it now is and will be for decades to come. Even if they are not interested, another major will be and it is nailed on the feelers have been out a long time now testing potential market appetite.
Forget the claims coming out of CB's mouth and instead collate and plot the results from the drill holes and assays yourself. It is possible to get a decent idea of how much has been added without relying on 'belief' of 'feelings'.
Not sure why you believe the grades are extremely low, many are in line with the average of around .26Cu mined at Cadia. Typical porphyry grades for the Lachlan belt. The original 71mt was made up of mainly the higher grade part of the resource. The numerous infill drills will have added to the 71mt before any of the extensions. It was highly unlikely that the extensions to the outer margins of RC would return grades as high anyway. So it is ‘not’ just the drilling outside the initial 71mt that increases the resource. So I’m sure we have certainly way more than doubled the Copper content as you say , whereas the resource is estimated to be 500mt, dependant on the cut off used. Let’s just wait and see the updated conceptual study. This will be more relevant now than the updated and initial resource estimates. Unless of course you are looking for an earlier exit?
To add, yes there have been some extensions, but at extremely low grades relative to the initial discovery.
Highly unlikely AA will be interested, Bird said it himself. Steve, how much was the license worth with the original resource? Look what we paid for it. Reducing the cut off to add to the resource will not add value to the project. IMO we *may* have doubled the resource from what it started at, but I’m not convinced that will make it valuable enough to make it worthwhile, certainly not good enough for my money to have been tied up here and at a 5p-ish average.
Certainly not a dreamer JS. My evaluation is from past RNS’s first and foremost, interview comments and plain common sense. You must think the management team are clueless.
Why are you still going on about 2mt! It’s unimportant now with the decision to mine. You are delusional if you honestly think that even after a third phase, which isn’t happening btw, 2mt will still not be met. I believe you just imagine it in your head so it must be true. Do some basic research at least.
Johnswan1 - Just lowering the cut off at Racecourse and using the existing JORC, takes us to approx 0.5mt. We’ve had drill results confirming large extensions in all directions since and I personally don’t get why you think we’ll be lucky to get 1mt… it literally doesn’t add up.
And why does it matter if there are separate mines at Ascot and Racecourse? They can still use the same processing plant and they’d be literally right next door to each other. Both discoveries are within the same licence that the buy back clause relates to (so is Footrot) and it all counts towards the 2mt trigger point.
I’m with Andrew… if we didn’t have enough to make a sale at a decent price, we’d be doing a phase 3 to get it. Also worth noting that the guys on the ground in Oz know and socialise with the AA guys and will definitely be having informal discussions. I think they will have a good idea what AA think too.
There is every reason to be confident despite the frustration of the many missed deadlines.
Howezap you are a complete dreamer. CB still believes there is 2MT in the license, but imho Xtract will never get close to doing that and to me it doesn’t even feel as though a phase 3 would be enough to get us there. My guess is around 1MT but I wouldn’t be surprised if it was less than that. We also know that you can’t combine the resource of Racecourse and Ascot to get a single mine.
Looking at how the strategy has perceived to have shifted away from the very early project objective of a drilling estimate of between 16-22k metres to prove up the 2mtCuEq to see if AA wanted back in, to a ‘hopeful’ 2mt estimate from RC with 3-5 holes stuck into Ascot to say to AA, “there you go gentlemen, there’s your other porphyry.” To eventually conclude the programme with in excess of 30k metres drilled, a shortfall at RC granted, but with numerous other anomalous targets, some confirmed with drilling, the deep gold system that shoots to near surface, the geophys target to the east that returned the highest gold intersect of 15.50g/t Au, footrot, including 2 further new targets identified and the possibility that RC continues to the NE. I think above all, far better geological knowledge of the relationship between RC and Ascot and what is now shown, to be this multi mineralised multi porphyry system similar in characteristics to Cadia.
Does that sound like they were just chasing grades to make up any shortfall? Or we have missed the boat for 20p a share with a quick sale. I hope we have missed a quick sale for 20p a share!
On the contrary, they could have just gone straight to conceptual study after RC and the decision to mine with a few holes into Ascot to say, “there you go gents……….” Alternatively they could have just chased the higher grades at Ascot to get to the original target.
Has there been a change of strategy? I don’t think so where exploration is concerned. But certainly from one that was reported to us. It has definitely exceeded expectations, I am certain It has always been, to achieve the maximum project value from the available funds in the treasury. I have no doubts they have achieved that!
Is that actually true? If a UK-listed company transfers ownership of an Australian asset (ProspectOre) to another UK-listed company (for example), why would they pay tax in Australia?
Not saying that paying tax in UK is any better btw :) but I would hope a very good legal firm would be involved in minimizing any tax liability.
I was under the impression that ProspectOre is an Australian subsidiary of XTR , with the asset being the project not the company
Fair points Andrew was thinking similar. I felt the, “do we keep drilling to get to 2mt” comment was very out of the norm for Colin. Almost down playing to keep expectations at a ‘sensible’ level. That would certainly help investor sentiment to cushion a disappointing outcome, but also prime the market to look more favourably upon impending news that wasn’t so disappointing at all.
Was it really just an off the cuff comment it came across as?
It doesn’t take anything away from the good news overall though that a resource statement is being completed which confirms there will definitely be no more drilling carried out. At least, before approaching AA.
"There has also been a change in tone from what seemed like nailed on confidence in the resource from Colin to something less inspiring"
Agreed. But is that because CB doesnt feel the need to ramp-up the sp now as he knows now exactly what we have or because he is trying to manage expectations as he knows its nothing like what he has implied man times?
I guess you could interpret his change in tone either way?
SteveFrappe... I feel the chance of moving on the resource for around 20p has come and gone. The original declared "quick sale with a bow on it" and the interviews created a sense of possibility. However having been a shareholder for way too long here my gut feeling now is that the chance of doing so (along with other XTR opportunity nugget misfires) has gone. There has also been a change in tone from what seemed like nailed on confidence in the resource from Colin to something less inspiring.
I would be surprised if the spike price in the SP of around 9p is achieved tbh. Hope I'm wrong and am still a large holder here but my experience to date of Colin's XTR is now one of much reduced expectations. The lack of enthusiasm by Colin to keep telling everyone how big it is these days doesn't bode well imho. We will see but I'm not holding my breath.
On reflection, I don't understand me either on that post to you, Cygnus .. disregard it (and at least half my other posts here)
NicetoMichu
Don't understand your post mate. Sure you're replying to the right poster ?
Apologies there Steve didn’t see your CGT post or for any implication that you are not respected. ;-)
Steve,
yep, also a good point. No wealth has been created so maybe there is no tax.
Hopefully somebody can give a definitive answer.
>>>Dont forget we will have a tax bill from the Australian government.
Not necessarily, this was posted by Thediddymen over the other side last year if it is of help or credibility. The poster is well respected. Suggest there will be no Aus equivalent to CGT.
>>>On the issue of the sale of Racecourse, Racecourse is owned by Projectore, a subsidiary of Xtract Resources. Unless I am missing something the way to return the cash to shareholders would be by issue of Prospectore shares in specie to existing shareholders of Xtract. The acquirer then purchases the shares from Xtract shareholders. In effect shareholders will see the net transaction which is a cheque/divi payment
That means that theree was no disposal of Racecourse, which means no CGT or Australian equivalent. While in the UK the transaction will be treated as a capital rather than income item, or in other words it will be treated as a capital gain. Shareholders will still retain their shares in Xtract which means that there will need to be a capital apportionment of cost to determine the capital gain if the shares are held outside an ISA.
What do you think that 1 meant specifically then Cygnus ?
Dead as a doornail in xtr again today .. so see you in The Lamb Tavern Leadenhall for a long lunch and have a Bucking Bottle of The Chocolate Block open and breathing when I get there, Geez .. would be my guess
Is that actually true? If a UK-listed company transfers ownership of an Australian asset (ProspectOre) to another UK-listed company (for example), why would they pay tax in Australia?
Not saying that paying tax in UK is any better btw :) but I would hope a very good legal firm would be involved in minimizing any tax liability.