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1st or 2nd qtr 25 will see income.
First need news in the development.
News please......
Spin? Just offering a rational explanation based on what has been put out and said.
My understanding is that what started out as a small scale ready to mine development project that revenue will pay toward a small sustainable mine that its cash flow will pay for to increase LOM
After evaluation the project has turned into a much bigger proposition that now first requires an initial major exploration programme that needs paying for likely through a fund raise.
CB has also said that any fund raises will only come as a result of major exploration.
There was talk that the potential scale of operation could or will warrant it ls own processing plant…..Now consider Manica’s development.
Kakuyu does not have a defined resource so exploration is potentially starting from scratch to create any kind of business case.
It could take far longer and cost more to monetise than the licenses positioned in the highly prospective western foreland where M&A activity will intensify.
Has been mentioned before that cb likes to buy a plaything with other people's money & when gets bored goes & buys another one.
Enjoy the day
Zap, what I take from that is:
a) "However, with the priorities lying now in the western foreland"--> Distracted by a new play thing and possible elephants, CB has become bored by the hard work required at Kakuyu.
b) "Alternatively, Colin also said it would be reckless to start a mining operation without first fully understanding the geology" --> Best way to understand the geology is by drilling. We had money to drill. He has mentioned drilling 3 times in 15 months. At one point it was scheduled. Why has CB not done what he said he would do or if he has, why has he not updated us with drilling results?
"Agreement ‘reached’ with Kabwe refinery for treatment and sale of ore" --> 3 references to this in 15 months and no income/progress on this front.
-"Geological contractor and grade control team employed on a permanent basis." Are we still paying for this?
Doing a decent job of Spin Doctor here, Zap. 15 months of overpromise and underdeliver is what I take from the above.
If you put yourself forward for XTR's PR job at next years AGM I'll vote for you howie.
Just for info
- “Samples sent to external consultant for metallurgical testing -why no news on this?”
From Feb 23 presentation
-Mett test work was completed through Jubilee metals.
This before agreement would have been made with refinery, indicating positive results were returned for compatibility of ore.
Hi Ben
Not to overlook from the FeB ‘23
Corporate presentation on Kakuyu.
-Agreement ‘reached’ with Kabwe refinery for treatment and sale of ore.
-external contract miner engaged.
-Geological contractor and grade control team employed on a permanent basis.
-Full-time in-house mining engineer employed to oversee operation.
Clearly then states that regional exploration is underway targeting further life of mine extensions.
So you would be led to believe that operations have been underway.
However, with the priorities lying now in the western foreland, it may be that a mining operation at Kakuyu that was stated that the project would be payed for from its cash flow, may have been shelved for now due to no guarantees can be made at this time toward fulfilling project development from outcome of any significant discoveries to continue a sustainable mine. Best to wait until they can be fully committed.
Alternatively, Colin also said it would be reckless to start a mining operation without first fully understanding the geology.
Take your pick on theory, but the project being shelved is almost definate imo with the projects exclusion from the latest corporate presentation. But it certainly doesn’t mean it is another duffer.
Yesterday, I offered it would be a bad idea for a youngish ? man like yourself, Ben 'Owell, to be taking any of the 'appy tablets .. Today, after that post, I'll offer just the one a day might be an ok level to go with :-)
Generally, imho best not look to write about what Mr Bird has swept under the carpet - across al his AIM entities - over the years...else À la recherche du temps perdu might all of a sudden look like a short read :-)
What is surprising about colin not updating shareholders?
I've just had a quick trawl through RNSs since the Kakuyu update on 26th January, 2023, i.e. 15 months ago. I was very surprised to see that it has been so long since a Kakuyu-specific update, but it does speak volumes perhaps about how little exploration has been going on over the past year. For anyone intending to see excellent progress in our new Zambian licences, the following tale could bring you down to earth with a bump.
26th January 2023
The following was described (a condensed version):
- There are several copper targets.
- Sampling and drilling required on the southern side of Kakuyu Hill
- Work is under way to push back the existing ramp access to the pit to expose in-pit extensions of higher-grade
- A 250t bulk sample has been delivered to the Kabwe Refinery ahead of negotiations.
- Samples delivered to an external consultant for metallurgical work.
- The Company is now sourcing a drill rig to test the potential extensions to mineralisation
Lots going on you would think. Fast forward to Final results, 6 months later (!), 29th June 2023.
- The phrase used is "Work is underway". I should hope so bearing in mind the Board described such work 6 months previous. What a great way to lower expectations!
- Reference is made once again to drilling ("We are scheduling drilling to assess the ore composition at depth")
- Reference also again made to "pushback to expose ore in the former open pit"
- Two bulk samples of high-grade ore have been dispatched to commercial concentrator operators for assessment (presumably this is the 250t)
- There is also reference to "the presence of random and variable amounts of cobalt, which we are investigating with a view to selectively mining the higher-grade cobalt areas."
Fast forward 3 months to the Half Year Report on 29th September 2023
· Work is underway at Xtract's newly acquired Kakuyu project in Zambia
(work underway again!)
- Reference is again made to them undertaking pushback
- Reference is again made to a 250t bulk sample being sent for processing at the Kabwe Refinery and metallurgical testing.
(the wording is almost word for word from the RNS 9 months before)
- Reference is made to targets requiring further sampling and drilling
Takeaways:
- The progress here is painfully slow. 15 months since initial RNS and much of that reported has not been reported on since.
- Drilling was mentioned in January '23. In June, it was "scheduled". Do we get to see any of the results?
- I'm flabbergasted by this one. 250t sample apparently sent in January '23 for testing. Almost the exact same wording used 9 months later. Why does Colin think he can regurgitate language 9 months later? 15 months later, we have had no news on this.
- Samples sent to external consultant for metallurgical testing -why no news on this?
- They have found cobalt -no news on this?
All in all, the lack of information here is ridiculous. We should be careful not to expect miracles in Zambi
There are a few different avenues of good news that could be RNS'd soon (ish) here, I'd guess ..
And even heads up that latest cash in the bank from Manica seeing a drill program kicking off soon off the back could rally this decently imho .....
(as long as there isn't a bunch of quick selling into any early buying...granted there'll always be a bit from penny traders in and out in short order.... but even a few ten of thousand gbp buy and holding here should overcome such..so roll on 1.5 p to 2p s/p window upon us here thru May please.. )
A very notable point from your comment Banzai - “Most of these outsource suppliers get fully paid when contracts complete.”
Yes, in hard cash and not in shares!
Manica disposal payments will allow them to prioritise the potential and prospectively of the Zambian licenses without dilution, which now the disposal has been passed it will see the phase 2 earn in of a further 3million ‘if warranted’ also be funded from treasury. (RNS’d)
Very positive projection going foreword.
It's an excellent setup that means almost all project are progressing, rather than one at a time.
By all accounts, the teams engaged are highly rated professionals. Bodes well IMO.
Most of these outsource suppliers get fully paid when contracts complete. So they won't be hanging around, especially so as copper exploration moves into a purple patch right now.
Just one project coming off will move this significantly IMO.
Looking across the various projects Jez, it would appear any news from the company in relation to progress or planning is at the mercy of the timescales of various independent consultants.
Appear to have outsourced technical studies with the exception of the Western Foreland licenses to concentrate all their manpower on. News from here next, could be the only one they have actual control over.
BR may have 3 different consultancies working on the optimisation, maybe a fourth later if they do more drilling.
Optimal mining, Lycopodium who are processing experts and, likely an alternative pre concentration tech being trialled. So could literally be next week or another 6 or 9 months.
Silverking data has been referred to an external geophysical consultants only last month to refine targets for follow up drilling. Could be some time before any action plan is announced.
Kakuyu parked up for now as warrants major exploration??
Hi Andrew
You may well be right. I am of the understanding, an eventual valuation will be on the projects NPV, using current or hopefully updated mining scenarios including being based on a smaller mill and plant with copper prices ranging across all scenarios from 8-11k. These ‘will be’ the copper pricing ranges used that NPV will be determined from, and eventual valuation will be based on, not 12-15k!
However, my only reservation is that the economic model being only supported at conceptual level when complete, the economic model will not be robust enough to use a discounted cash flow model across the projected LOM.
Away from Valmin code and on global market, a DCF model can usually be used toward a higher valuation than one determined by Valmin. But have a feeling it needs to be supported at pre feasibility for DCF to be used. Need to look into it a bit more. Still early days.
News could be any day now..
It's very unlikely but you can't rule it out
Col:
"Eyup Ben 'Owell , arv bowt a shovel, let's get diggin' lad"
Ntm agree this certainly isn’t a sprint but every month cash burns so a wiggle on would be good for SP.
Put option?
At least if SP dips can load up sub 1 - it’s catatonic here
O and W
Difference is though we dont know what is under the ground at Zambia. Could be the jackpot or could be nothing and worthless.
Apparently BR is the 10th biggest copper discovery in last 10 years. But unfortunately worthless at current POC .
Best to think of BR as an out of the money long-dated call option.
Surely the main action here will be drilling in Zambia. I just have no idea when it will start, despite the ending of the rainy season.
"Copper spot price is not going to have a direct effect on a valuation for BR"
Sorry HZ dont agree
There are obviously other factors that will determine sale price such as capex and opex (as you have said).
I stand by my view that IF POC was $2K to £3K higher ie $14K not $12K then we would get a significant higher sale price (IMHO of circa double). Albeit nothing like some valuations
I'm not saying that is the sole factor, but would be a significant driver to any valuation. That's why BR's valuation now is Zero.
Like that one Mr Bal !
very apt .. and Mr Colin Bird himself might well be all for noting to shareholders : 'it's not a sprint, it's a marathon'
Or a very very old snickers bar with “marathon” on the front occurs you me
Shame NTM
I can only assume £0.5m is better spent on other projects.
I say assume cos bored members not giving market any update ⁉️
100% agree Ben 'Owell.. logging in once a week maybe instead though :-)
100 % AGREE Cruella, but it likely won't happen, alas..
even a half a million quid invested in such here would do wonders around now.. as this is/has been epically illiquid for a long time now..