Member Info for Andii

It's basically bad news and a great way to lose all your money. Works best in a bull market and the UK small caps are not behaving at the moment so chances of losing your whole investment are high.

Telegram is so active yet it is so quiet here... Gives the appearance of being unloved!

Has anyone managed to open a spread-bet with MARU? I managed to open a £500 long on friday but monday and today I.G tells me that it is available for closing deals only.

Sovereign metals have a large 1% Rutile (Titanium) asset. The NPV is around $1.5b but no idea how they and EEE would compare.

https://www.investi.com.au/api/announcements/svm/22095baf-388.pdf

Interm results landed 29th December last year, 2nd December the year before. So any.. week.. now!..

Looking forward to the first research note from new broker, Shard Capital. They usually include forward financial forecasts for the following few years (when a company is earning revenues). Their client list and financing skill-set could also be very useful. I wonder if the new broker appointment has come off the back of the new NED appointment?

Could positive margins in the interm results be a pre-requisite for financing? We surpassed the total revenue of the previous year in month 5 (mid August) so surely the results will be further positive conformation on the comapnies ability to grow and maintain good margins.

Updated report on Montepuez potentislly due before the end of callander year 2023. Again, super valuable as this can increase the asset value on paper due to improved economics. Another tick in the box for achieving debt financing.

Further potential news/growth drivers;

VAT payments overdue and could arrive any time.

Chinese Graphite export ban starts start of December which could see a spike in spot prices.

1 million dollars. And this was announced 7days after the accounts were issued, not 2.

If you check question 10 from the AGM Q&A, prepayments is actually something which happens regularly in the background, but on a smaller scale.

https://www.investormeetcompany.com/investor/meeting/pre-agm-update

It is a 6 month loan at a discount of between 7 and 15%.

(The discount reflects market softening, imagine a 15% loan but graphite prices also fell, the real cost would then have been higher and potentialy still waiting 45 days or more for payments)

· The orders are to be shipped over a six-month period.

· These orders represent c.15% of the quantum of sales the Company expects to make over the six-month period.

· A discount of between 7 - 15% has been applied to the price in return for the pre-payments and which also reflects recent market price softening.

Forked tounge aye?!

I just searched the full year results and provided the quote. I went there to educate myself.

I knew that a related party sold the equipment, I thought it was panagraph but it is Hararimay. Panageaph do the technology and other graphite downstream work.

Haritmay Ventures LLP (HV) is an entity incorporated in India and engaged in manufacturing proprietary tailor-made flake graphite processing machinery and equipment which the Company uses in its projects. The Company is connected to HV in that Shishir Poddar is partner and shareholder of HV during the year. At year end, a net amount of £287,039 (2022: £230,624) was receivable being advance paid for long lead machinery purchase and the Company purchased proprietary graphite processing machinery and spares of £861,368 (2022: £1,132,398) during the year.

*they aren't just

Panagraph upgrade the graphite into more valuable products tho, they rent just buying cheap and selling high taking a cut. They are processing and upgrading.

Also, so what? That equipment would have cost more if supplied by a chineese company. Both TGR and Hartimay Venutures have benefited from the equipment sales.

Beevorma, I don't believe the question is about the discounted prepayment for $1m

The question is about how big a discount (if any) is being applied to material sold to the Indian company owner or partly owned by some of the management (so a related party)

We are only told "customer 1 (and a £ value of sales)", "customer 2... etc" in the results.

But we don't know who the customers are and what flake size or how many tonnes each are receiving.

Harakiri,

Panagraph were previously known as Tirupati Speciality Graphite.

Here is an example of an RNS where their mining technology was sold to a vanadium miner.

https://www.lse.co.uk/rns/TGR/tgmrc-builds-strong-new-business-pipeline-oo5ifhcy3ykilei.html

The original plan was to buy TSG for £2m (from memory) but ee have been told the Indian regulator blocked the move. (Due to TGR being a UK company and TSG being Indian, talk about £2m being an unfair valuation also i believe) The poddars owning 30% of TGR maybe also complicated matters.

Now we know that TGR have paid TSG (now panagraph) for equipment and services in 2022-23 financial year. Less than £1m I believe.

What did they receive in return?

A new 18ktpa plant able to upgrade sub 3% grade graphite to over 96% grade graphite at a hugely competitive cost of around $300/t.

Pre-concentrate units which reduce haulage costs, diesel costs, machinery wear and tear, increase efficiency massively and which allow the operation to continue during heavy rains.

Now one of the reasons BAT minerals chose TGR as the Company to sell the Mozambique assets to is thanks to this mining technology. (Supplied by TSG/panagraph). We know that the main drivers for Capex and Opex improvements over the 2018 Madagascar (Montepuez) DFS is achieved thanks to reduced machinery prices (thanks to panagraph) and increased efficiency (thanks to panagraph)

And I think your other point was about selling graphite to them. All sales are audited by the auditors & the Poddar family own around 30% of TGR.

Every sales contract will be negotiated sepeeately at its own unique price. Every sale is profitable but some more than others. Sales to a related party would be one of the first issues an auditor would examine so I don't see this as a red flag.

Here's the December 2022 research note with targets based on $300 helium

https://drive.google.com/file/d/1EMG7iWmP7_x27f-gktg-vaBhKBuZFyle/view?usp=drivesdk

I guess the increase in helium contract prices should also be factored in to a higher market cap this time. These price increases will greatly increase free cash flow. 18 months ago Helium was selling at $300/Mcf, now looking closer to $500/Mcf with spot prices much higher.

**Noble Helium, this is their first drill, and is a shallow exploration well.

From hot-copper:-

"Hole was probably drilled with heavy mud to allow the "over-balanced" drill (i.e. additional pressure is introduced into the BHA to reduce any blow back from the pressure of the formation). This introduced pressure often caused formation damage and the drill mud can forces its way into the reservoir, especially if it is permeable as is indicated... So the wireline is less precise and sampling impacted. The MDT sampling is far more relevant than the wirleine isn't it, as a physical sample."

**Their next drill will be an appraisal well, slightly deeper but drilled using the knowledge gained from their exploration well

Meanwhile HE1 are drilling much deeper and this well is hoping to be an appraisal well with the opportunity to be a producing well if it has hit the motherlode, is this correct?

HE1 already did their exploration well in 2021

The bull case

*this well and the next well could both be production wells

*High-grade surface helium seeps up to 10.6% He recorded in the area, yet the Competent Person Report bases the reserce estimate on 1.1% HE

*The bottom basin is much deeper than expected indicating higher concentrations and larger volume (and potentially higher pressure/flowrate)

*Independent CPR in May 2023 confirmed a 2U net helium prospective resource of 2.8 Bcf in the Tai structure, with an upside 3U of 7.1 Bcf (This could now be revised up due to the extra 400m)

*upside potential of 138 Bcf across licensed areas. (To put this into perspective, at $450Mcf, this would be worth $62billion - and it could be higher if the basin is larger/higher concentration at depth)

They posted another RNS to clarify, many hours after the first (so two RNS's today)

Noble Helium Limited (ASX:NHE) (“Noble Helium” or “the Company”) provides

the following clarification to today’s update on drilling on at Mbelele-1 at the Company’s North Rukwa Helium Project in Tanzania.

The testing programme of the Mbelele-1 well is NOT completed. The wireline logs run by SLB have

identified multiple zones of interest where stacked, interbedded sandstone-clay formations are coincident with helium shows above background detected in the mudgas.

As noted in the earlier announcement we are running MDT and mini-DSTs tools to take down hole

gas and fluid samples to confirm the makeup of the gas, including helium content and determine

reservoir characteristics.

As noted in the earlier announcement MDT sampling and mini-DST runs are expected to take a

number of days, after which we will advise the market of the makeup of the gas including helium

content and reservoir characteristics.

Mbelele-1 was always planned to be a test well and was not designed to be used as a future

production well.

I have zero geology knowledge but I believe they had calculated a rock density and from that, estimated a distance to drill. Think they had a gravity survey? So they had a model of the layers but depending on the density, the distance between the layers on the model would change.

They have now drilled 1km and know the density of all the layers hence can calibrate their model now and know the lower zone is 400m deeper than estimated

CameronF @ 10am

From the 2022 research report

$45m of cash flow from $50m capex

Assumptions

Revenue, $105m

Plant production 350 Mmcf/y

Operating costs, $7m

helium price, $300/mcf

Maintenance capex, $1m

Variable operating costs, $20m/mcf

Royalties, $3m

Maintenance capex (% of sales) 1%

EBITDA, $94m

Royalties (%) 3%

Government share, $15m

Government carried stake 16%

Tax, $24m Tax rate 30%

Free cash flow, $55m

........

I would imagine with higher concentrations, the operating cost will come down. And obviously the free cash goes up at $450/mcf helium price

I read this from the 2022 December research report

"Note that the Karoo formation remains Helium One’s main target, and wireline logging of this sequence will be a crucial objective of the Phase II campaign. At greater depths (>1,200m), pressures are higher, such that there are likely to be denser, better sealing units. As gas compresses with depth there will also be more gas per volume of pore space."

Deeper = higher concentration meaning they will be excited to see what they find on the wireline at these new depths

Https://youtu.be/OaMcIf1AFRk?si=TenqTqYizjvYiv6R

12m, Madagascar HQ

13m, one of their two processing plants

I guess you can't visualise what 4500t of graphite looks like? What about 14m tonnes?