Member Info for 99icecream

I think HZM are to some extent a victim of their own weazel words. Had they said clearly that they had shut down all works until further funding can be secured, it would have avoided the idea that Araguaia could go into Administration (or whatever the Brazilian equivalent would be).

100% ceased work, nothing happening, no essential works

I'd be concerned if they were doing anything that was not in the budget (spending money they don't have)- this is good news.

IMHO The lenders will be heavily involved atm. If funding is not forthcoming in 2024, they don't want to be left fighting in the courts in Brazil to get control of the assets. So, they will ensure that bills are paid, but also HZM do not make any new commitments.

Magnum - If this is sorted by a share issue near current prices then thats effectively what happens. Say Glencore et al. who own approx 180 million of the 270 million shares each buy 15 shres at 7p for evey shre they currently own they raise over $ 200 million and the small investors who currently own 1/3 of the company end up with 1/35 th.

Glencore, Orion and La Mancha will be insiders (doing their due diligence) so cannot deal.

The Nickel price is down from 18k to 17k in two weeks, which makes any deal difficult at the moment. Hopefully, more stable in 2024.

I don't see the price moving much from 10p in the short term, there are many weeks before any news. I will wait weeks before buying.

While we are on the subject of BHP's attitude to Nickel, you might want to consider what Glencore has been up to in this market.

As a result of falling prices they have put their mine in New Caledonia on notice, effectively saying that it will go into care and maintenance unless substantial cost savings can be achieved. This may signal moves by other miners to take high cost mines out of production whilst the current surplus of Nickel exists:-

https://www.nsenergybusiness.com/news/glencore-to-stop-funding-koniambo-nickel-mine/#:~:text=Swiss%20commodity%20trading%20and%20mining,in%20productivity%20performance%20and%20reliability.

As recently as mid June 2023, Glencore together with La Mancha, Stellantis and the battery subsidiary of Volkswagen where to invest substantial sums in Brazil in Nickel and Copper mines:-

https://www.reuters.com/markets/deals/glencore-automakers-back-1-bln-nickel-copper-spac-deal-brazil-2023-06-12/

This transaction was subsequently abandoned due to falling Nickel prices :-

https://www.proactiveinvestors.co.uk/companies/news/1028226/glencore-vw-stellantis-spac-plan-collapses-after-nickel-slide-1028226.html

So given the current circumstances at Horizonte, could VW and Stellantis be interested in a deal on Horizonte ??

John - The NPV / IRR / Free Cash Flow LOM in the August 2023 Presentation assumes a Nickel Benchmark of US $ 20K / Tonne. Put US $ 20K / Tonne in the calculator and you get the same numbers, so the calculator assumes the relationship between the Benchmark and the sales price of ore etc.

However, I would suggest that its questionable if NPV8 is appropriate for this particular project, NPV10 might be a better?

There is apparently lots going on in Morocco due to its "abundance of critical materials" for EV / battery storage industry (e.g. Lithium, Phosphates). This might imply that the Moroccan government will want to be particularly careful in setting environmental standards that will apply to all new mining projects.

https://www.scmp.com/news/china/diplomacy/article/3241060/china-sets-sights-morocco-north-african-nation-becomes-centre-ev-revolution

Two 250k buys = £ 22k approx (plus Two trades reversed)

"...yesterday they floated production to 60mtpa..."

Thanks for that - I missed that on first read - very subtle !

No great mystery here. We have been at 0.35p / 0.45p (an insanely wide spread) for a while based on the recent share issue at 0.38p. Yesterday one of the dealers dropped their offer to 0.40p and was promptly lifted in 1.9 million shares. This morning another 3.9 million was bought at 0.45p approx.

The point is that Magnetite is not necessarily better than Haematite just because it has more iron vs. oxygen. The quality depends upon the % of impurities.

"Unfortunately, we’ve got to dig through the hematite to get to the magnetite"

IMHO you miss the point entrirely here Magnetite (Fe3 O4) is 72.4% Iron Max, Haematite (Fe2 O3) is 69.9% Iron Max the balance is oxygen. Oxygen is not the issue, its the impurities that come with the iron. So if you are digging Magnetite the target for purity will be higher !

Agreed, more cash is required just to release the remainder of the existing debt. After the independent estimate of costs there will be discussions with the lenders about any flexibility with the existing loan terms and the possibility of added loan amounts. Then the required cash will be known.

The issue/ risk was hidden in the 17 Aug 2023 Results in the "Going Concern" section.

"a risk that cost increases in the remaining part of its $532m construction budget (62% spent so far) linked to several of the major construction packages including labour, materials and productivity, could result in future drawdowns on the senior debt facility not being permitted and require the Group to pursue alternative sources of funding to meet its commitments.”

This was spotted by John Cornford - https://masterinvestor.co.uk/commodities/mining-doldrums/

Publican.

You must admit its a bit strange that you have posted (at great length) 102 times about HZM in the last 30 days, when you have no interest in this share at all.

I suspect we are way beyond the point at which a supportive statement form the board will influence the shareholders opinion of the performance so far.

Well I respect your opinion but I don't agree at all. Its upto everyone here to do their own research and not follow the herd (or me or you).

I suggest its the other way around. If Vermelhio stays with HZM it wont be developed for maybe 10 years . On its own it could be developed from 1 year. In NPV terms its value if developed now vs. 10 years is different by a factor of 2.5.

IMHO nobody wants to put more money into HZM. So I suspect the large shareholders will secure their investment against Vermelho.