Firering Strategic Minerals: From explorer to producer. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
A reiteration overall ;-) but with some Interesting comments,
“Racecourse is much bigger than we ever expected it to be”
?
“Decided not to go chasing those huge targets”
Really want to see them survey results!
Confirms some of the resource will be indicated as has been discussed here.
Biggest revelation is there doesn’t seem to be any likelihood of a third phase.
Commented once again about an October November turn, he sounds hopeful or even set on things happening with AA before end of Q4
Howezap, why havnt you picked out the part where 2mt hasn't been hit?
"why havnt you picked out the part where 2mt hasn't been hit?"
The 2 mt clearly has not been officially declared and that may explain why no updated RC model has been issued yet. As it would show we have not got 2mt confirmed.
However, CB's comment in the interview "Racecourse is much bigger than we ever expected it to be" is a strange one. Even for CB, it would be a step too far to make this statement if the resource is less than previously expected and claimed only a few months ago with his 2mt comment.
I may have got this following theory wrong and maybe I'm being too generous to CB here, but my understanding now is that CB thinks there has been enough pre work re geo phys, drilling etc that a major can see the potential of all of Bushranger and we will get additional attributed value from other areas without doing more drilling? Obviously more drilling will increase the value as the major would know exactly what they were getting.
Same point as CB has made about doing just a bit of drilling at Ascot to show that there is something of interests there which has value.
CB said in that interview that we would of get to 2mt if we did more drilling so he may take the view the major will also believe this (from work and evidence already done) so no need to spend more time and money in phase 3. Obviously the value we get would be higher against confirmed resource than a " good chance" of additional resource / 2mt.
So maybe CB is right in saying that RC is much bigger than we ever thought but not yet confirmed? And now is looking for a valuation based on what we know is there + highly likely other potential value - which CB is sure will see a valuation by majors of or higher than a confirmed 2mt?
That's my gut feeling on what his strategy is now from that interview. I may well be wrong, or if I'm correct, it could be silly and risky strategy for CB to follow re maximising value. But that's my understanding of what he intends to do now to ensure we come to a conclusion on this project sooner than later.
Hi lucky yes I was always hopeful that racecourse was ‘closer’ to 2mt by ‘offering’ examples of where the copper eq tonnages could potentially increase within the resource.
The effect of disposition of lower grade ore outside the high grade part of the resource when the cut off is reduced and what impact the infill drilling could have to increase the current inferred resource once (partially) upgraded.
I have also said on many occasions that the intent is to get to one of the trigger points to see what AA want to do as going forward this needs to be sold for the company to grow.
The most important thing is the eventual sale as I’m sure you will agree and this podcast has made the position clearer going forward, and shows clear intent now to take racecourse to a conceptual study for the decision to mine. The 2mt now becomes irrelevant other than overall value.
The other point that was questionable is that it does appear a buyer will acquire all of the licences together.
Good reasoning Andrew I would agree.
Andrew>>>So maybe CB is right in saying that RC is much bigger than we ever thought but not yet confirmed?
Totally agree as assays from some ‘Racecourse’ holes shown deep intersections that hit potential deeper porphyry/s under the main ore body. This is a huge plus for the economics as eventually the deeper system/s would be accessed after the open pit is depleted with only minimal cost and ongoing OpEx as all infrastructure and plant would have already been paid for. This would extend Racecourse life of mine by decades!
They would have a very good idea on deeper anomalies as the EM survey (I believe) that has been done scans down to as deep as 1.5 km
What about the scenario where Colin and team want AA discussions to start and an offer put forward from AA, the offer could be 100m/200m or more etc. At this point, the SP rises to match the valuation, allows impatient holders to exit, offer is declined, xtract raise 10million of the back of the rising SP for extra drilling and find 2 or 3 more porphyrys?
Just a thought. I would be happy with this as I am looking to get some sold and this is why im impatient, but also would love to follow the bushranger story.
This may not work due to the buy back clause fine print, which we don't know.
Thanks for posting the podcast. Good day to post given the lack of football !.
Some good bits such as where BR stands on the Lachlan Fold in relation to its competitors. Just not sure in this market it will make much difference. Colin might be experienced with rising interest rates but QT ??.
I did note that CB thinks it will be a 20mt x 25 years resource. Ignoring the current market situation, anyone any thoughts about its possible market value in the future ?
It’s always darker before dawn, sums it up , the next couple of months will be interesting
The 20 x 25 = 500mt which imho further confirms we are well short of 2mt con copper. For that to be the case then we would need 0.4% Cu Eq which is highly unlikely looking at assay results.
As for valuation. There are so many different variables and assumptions. So when you change a few and multiply them out the margin of error / different results are high.
For what its worth my assumptions are:
1.4mt Cu Eq (500 x 0.28%)
$8500 cu price used
0.9 GBP / USD conversion
1.5% in ground value. The 3% mentioned is usually against a much higher level of confidence of resource ie a lot measured not just implied / inferred
That comes out at 16p ($178M = £160M) with 1 billion shares in issue
Thats for RC only. We have to add on Ascot and the other areas of interest. I think circa 20p is a reasonable estimation.
If you listen to the interview from 4min 15 sec to 5mins CB does appear to be hinting that the majors know what we have and the geo phys work etc may give then confidence to attribute value to other areas that have little drilling or maybe no drilling. I guess the simple analogy would be - if you have drilled half a football pitch and found value in it, then there is a decent chance the other half would be similar. You would not value the other half the same but nor would it be valued at zero value.
A rather over simplistic analogy - but you get my point
I think CB now thinks we've done enough for the other areas to have "some" value (how much is the question) attributed to them. How much or little, value the other areas of the licence (ex RC) is attributed by the majors may significantly change the valuation.
For total buy-out, I'm looking at 15p as minimum, probably circa 20p and with a bit of luck and great negotiation skills by CB, 25p max
Andrew - I appreciate your analysis. Thanks. When do you think the ‘Decision to mine’ will be announced? Colin appeared to make something of Oct/Nov timeframe. Did you pick this up as well?
Think CB, said on Racecourse model.
In not to distant future
So hopefully that will be around mid/end of Nov at latest.
Will, just say he also said along lines of that Xtr generally has good idea on what that will look like.
So presume he might have talks with AA before actual release.
If CB said " Not too distant future" and Oct / Nov time scale then I would think very earliest would be December, more likely Jan and possibly Feb.
Sorry
It was me that added mid/end Nov.
I know that when CB even gives a rough timeline then with this one. It might not be until end of Dec/early 2023.
Enjoy w/end
Andrew. Thanks for the figures. In the short term I expect the markets to be down but the $8500 is about the price I was figuring on mid 2023/24. Possibly Colin is looking to sell by his 80th birthday.
One further thing I took from the podcast is now that they are doing the resource statement, it would imply they will not be doing the extra shallow high grade drills to extend the early recovery phase 4-6 up to 8years as they would surely want to wait to include any extra tonnage in the resource statement toward the conceptual study.
I know this would count toward the third phase, but also a previous podcast CB said they would end up with the shallow high grade programme that seemed sensible to bolster the early recovery phase anyway, done wether or not any other drilling was undertaken in a third phase.
Think he would have mentioned wether or not this would be done if was still an option.
Found the podcast quite uplifting in the light of the ongoing lack of news and depressing situation in Ukraine. I feel reassured that CB has a clear plan of action and a steady hand on the tiller. I would be most surprised if we do not have a decent uplift possibly starting tomorrow onwards. Many thanks for the informative posts and particularly to anyone being bold enough to indicate where the sp might soon be heading.
Sunday roast today, talk about xtract at 1hr 6 mins in (2 min discussion)
https://audioboom.com/posts/8163008-the-sunday-roast-featuring-paul-griffiths-executive-chairman-of-predator-oil-gas-lse-prd
Interesting interview. It certainly sounds like 500Mt of ore now, he said it both ways - 20 Mt pa x 25 years and 25x20. Personally I suspect a slightly lower grade than you Andrew so maybe 1.2-1.3Mt but these.are all guesstimates.
Several questions though. Did you get the impression that the infill drilling has been done already? He certainly seemed to indicate that additional drilling has been done to improve the granularity of the model. But now I’m confused about the large anomalies that they’ve decided not to drill - which is he talking about? Ascot? I note there was no mention of it, though he talked about the sale of the whole of BR, so do we assume Ascot will be left as is? He certainly said they could continue to drill the anomalies to prove up the 2Mt but won’t now, which supports the conclusion that RC is << 2Mt.
Overall he certainly sounded quietly confident.
Iwantthatone,
My reading of his interview is that they have the IP survey results and there are new 'anomalies' which will not be drilled. The existing drill results are sufficient to imply that these anomalies contain Cu although how much is anybody's guess. They will however be valued very lowly due to the lack of evidence. It does however raise the question of why have we not seen the IP survey results? I know I would be interested.
That's the way I read it but it's only my guess.
RC bigger than CB imagined.
Phase 2 drilling completed, inc infill drilling.
Model building continuing.
New JORC compliant resource and updated open pit conceptual study "soon", and decision to mine.
AA option to make an offer or reject.
Open market search for a buyer if AA don't make an acceptable offer.
500MT ore implies Cu of closer to 1 m tonnes than 2 million tonnes, but still, nothing to be sniffed at.
I personally would continue with a Phase 3 using Fairbride funds, but l get the feeling CB is in a hurry. He is 80 after all.
I see no evidence on NSW Titles Management Systems of any applications to drill new locations on EL5574 so this indicates they have no immediate plans to drill the new anomalies identified in the IP survey.
Also on TMS there is licence renewal application on EL8305 ( I also think this may cover EL8306) submitted on 18 August.
Good find Andy. Always good to get independent corroboration of Bird's statements.