Firering Strategic Minerals: From explorer to producer. Watch the video here.
Resistance band now at 0.85/0.875p then have a free run up to 0.95/1.025p
... with main seller gone pressure will be up
ATB APR
Stockbox Interview from yesterday https://youtu.be/3ylJ3BcHwMQ
> OCIM met in May-22 so 6 months process & Due Diligence completed
> OCIM liked LSE listed + growing gold producer +strong BoD +LBMA registered
> £8.2m Non-dilutative funding raised vs. £14m MCap
The 'Deal' ...
> secured conditional non-dilutive financing of up to US$10.5m (£8.2m) in 2 tranches
> pre-paid gold purchase agreement with OCIM Metals & Mining SA ('OCIM')
> RM confirmed less than 15% of gold production to be sold at spot minus small financing discount
> Tranche #1 = US$7m to be drawn on or before 31 December 2022
> Tranche #2= US$3.5m to be drawn down on terms yet to be agreed
RM stated new capital to be deployed for fully funding ...
> expansion Kilimapesa expansion to target 24koz pa & final commissioning in Mar-23
> completion Phase 2 exploration drill programme at Nyakafuru Project in TZ
Expected Newsflow
> Q3 Operations report to end Sept-22 ... RM apologised for delay
> Updated MRE for Kilimapesa ... delayed from end Oct-22, but RM said results were really good
> Nyakafuru Phase 1 drill results due ... RM stated confirmed prior JORC and will include Phase 2 programme plan
> More financing news due (not sure for what?) & RM stated desire to do more deals with OCIM as really liked their approach and business model
Comparables
RM stated nearest comparable to GCAT was TRX in Tanzania in terms of size, a producer scaling up, geology, strong BoD and funded for growth
> TRX 1koz/month vs. GCAT 2koz/month
> TRX CAD $10.5m (£6.5m) vs GCAT £8.2m cash/facility
> TRX CAD$120m (£75m) MCap vs GCAT £14m MCap
> Comparable resources
> TRX based in Tanzania and GCAT in Kenya/Tanzania
Lots to like, especially as RM wants to avoid dilution of his and shareholder value plus he believes GCAT now massively undervalued given funding confirmation and derisking.
ATB APR
Looks like they are out ... TR1 soon
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
29-Nov-22 09:16:42 0.661 59,835,953 Unknown* 0.75 0.80 395.52k
29-Nov-22 15:40:42 0.76 5,000,000 Unknown* 0.75 0.80 38.00k
@Magmanus GoldPlat have been the consistent seller since RTO in Aug-2021 as the asset was previously theirs which they divested as it was a non-core asset on care & Maintenace before teh current management team effectively bought them out. In essence GoldPlat needs the cash so has been steadily selling down its shares and as they were 'free' shares is not that price sensitive as it just wants the cash ... irritating but it is what it is and on the plus side allows us PIs to accumulate on the cheap as have been stuck in this 0.675 to 0.875 range since Jun-22
ATB APR
Looks like support now at 0.675p and next resistance at 0.875p but still in sideways consolidation zone that GoldPlat has been selling into. High volumes now going through should help shift it and clear them out quicker
ATB APR
Yes GGP was an interesting journey too for me from 2.1p up to 23p when I offloaded as it was getting very frothy and irrational. We do need to remember than GGP had two not one Major as potential suitors which was driven by the (in)famous drill results from HAD 006 in Feb-19 of 367.1m at 1.15g/t gold, 0.44% copper and 176ppm cobalt from 471m.
IMHO drawing comparisons between GGP and GCAT is all very interesting BUT the mineralisation is totally different HOWEVER GCAT does have some real aces up its sleeve which GGP did not namely:
> GCAT is a gold producer so has revenue and a modest $1,150 AISC ... circa 500oz/month & planned 2koz Mar-23
>> $30m plus traditional 500tpd mill/CIL plant and matching tailings facility @91% combined recovery = high grade ore
>> Small scale 35kt capacity Heap Leach plant 3 now operational @53% recovery = low grade ore
>> Large scale 120kt capacity Heap Leach Plant 4 under construction @53% recovery = low grade ore
>> 10-year LoM at 24koz @Kilimapesa from updated MRE @Jun-22 RNS
>> Large scale expansion drill programme underway since Jul-22 ... awaiting updated MRE now overdue
>> history of Colonial area mining and recent artisanal mining indicating high grades at or near surface
IMHO updated Kilimapesa MRE will be the 2nd game changer as it is nearby existing infrastructure & operating mine PLUS it is near surface and indications of high grade & long strike lengths yet to be proven up and no idea of depth of mineralisation (yet).
Now the £8.2m non-dilutative funding has been confirmed and given BoDs strong delivery record to date I don't see a lot of downside at £14m MCap; this is more or less where it was when GCAT launched last August but with an additional £7m already invested from RTO plus another £5.8m new upfront capital injection to deploy now.
ATB APR
Digested figures since GCAT RTO in Aug-21
Gold production figures from Plant 1&2 only ... See Quarterly Ops report RNSs:
> Q3'21 = 1,555oz
> Q4,21 = 2,088oz
> Q1'22 = 1,266oz ... Pilot 15kt HL plant 3 commissioned
> Q2'22 = 746oz ... Plant 3 expansion to 3x 15kt pads underway & commercial 2x 60kt HL Plant 4 announced
> Q3'22 = ???oz ... Plant 2 Tailings upgrading & offline, Plant 3 completed and Plant 4 WIP
Base Monthly Production Capacity ... using original Plant 1&2 capacity, Q1/2 grades and %recoveries:
Plant 1 & 2 = 10kt *2.5g/t *91%/31.1 = 732oz ... 500tpd mill over 20 days= 10kt @Q1 @80% CIL & 50% Tailings recovery
Plant 3 HL = 35kt *1.72g/t *53%/31.1 = 342oz ... assuming 3 month cook cycle & Q2 @53% pilot plant recovery
Plant 4 HL = 120kt/3 *1.72g/t *53%/31.1 = 1,172oz ... assuming 3 month cook cycle & Q2 @53% pilot plant recovery
Summary = 2,246oz/month using non-upgraded plant capacity & %recovery data
Base case assumptions:
> Ore grades from Q1/2 Operations reports
> Plant 1&2 = original 500tpd mill & combined throughput so 91% recovery
> Plant 3&4 = 3-month Heap Leach 'cook cycle' for throughput BUT only 53% Q2 reported pilot plant %recovery
Expected Better Case Production:
Plant 1 & 2 = 20kt *2.5g/t *91%/31.1 = 1,464oz ... 2x500tpd mill over 20 days= 20kt & no %recovery improvement!
Plant 3 HL = 35kt *1.72g/t *60%/31.1 = 387oz ... assuming 3 month cook cycle & improved 60% recovery
Plant 4 HL = 120kt/3 *1.72g/t *60%/31.1 = 1,327oz ... assuming 3 month cook cycle & improved 60% recovery
Summary = 3,178oz/month using upgraded plant 1&2 capacity & improved HL %recoveries as 3-month cook cycle
Commentary:
IMHO Oct-22 presentation is based on Q1/2 Operations grades, plant throughput, pilot HL plant %recoveries and original Plant 1&2 capacities so is uber conservative and still gives 2,246oz/month or a 12% margin of error for GCAT to hit their 2koz production target! I am expecting Plant 1 upgrading of additional CIL tanks and another 500tpd mill to double throughput when completed in Q1/2'23 at same or improved %recoveries.
Given that capital funding has now been secured and plant upgrades are now well underway AND fully funded then my 'Expected' case production of 3,178oz/month is not unreasonable implying a 60% throughput uplift for the same capital spend. It also introduces ability to still hit 2koz/month throughput and to:
> process considerably higher amounts of lower grade ore via HL
> increase HL throughput by reducing HL cook cycle but at reduced %recoveries
Food indeed for thought as I am now expecting GCAT to under-promise and over-deliver!
ATB APR
Now the financing has been confirmed this should pave the wave for a number of expected news flow items:
> Q3 Operations Report to end Sept-22 ... now overdue
> Updated JORC compliant MRE for Kilimapesa expansion drill programme ... all new resources at expected high grades from old mines and/or artisanal workings over multi-kilometre strike lengths
> Nyakafuru drill programme Phase 1 results given Phase 2 is now funded
> Possible Nyakafuru Reefs project purchase ... delayed and adds 400koz JORC resources
GCAT have been expansion drilling around Kilimapesa since Jul-22 but no detailed results from Vim Rutha and IMHO prior interim MRE was NOT stated as JORC compliant as it would have triggered a payment under original RTO deal; funding now solves that issue so MRE will land soon.
ATB APR
Stunningly good news ... to raise $10.5m/£8.2m for a £10.7m MCap junior miner against future gold production is an amazing coup for RM and the BoD
The 'Deal' ...
> secured conditional non-dilutive financing of up to US$10.5m in 2 tranches
> pre-paid gold purchase agreement with OCIM Metals & Mining SA ('OCIM') subject to conditions, ... not stated
> Tranche #1 = US$7m to be drawn on or before 31 December 2022
> Tranche #2= US$3.5m to be drawn down on terms yet to be agreed
New capital to be deployed for fully funding ...
> expansion Kilimapesa expansion to target 24koz pa & final commissioning in Mar-23
> completion Phase 2 exploration drill programme at Nyakafuru Project in TZ
Commentary:
A very good non-dilutative gold streaming deal allowing GCAT to fully fund to 24koz production by end Mar-23 at circa $1,100/oz AISC, but at a fixed price/discount to current gold price with these details as yet undisclosed.
Doubtless there will be some 'Sell on news' folks, but for everyone else this takes away all-pervasive funding concern given the obvious delays in rolling out the expansion programme apparent since Sept-22 when the timeline started to drift and news started to dry up.
This should now pave the way for Q3 Operations Report to end Sept-22 which is now well overdue and will undoubtably confirm some of these delays and depressed gold production. The current warrant holders whose warrants expire at end Dec-22 will likely be disappointed, but this in turn will also help boosts SP as forward dilution will be much reduced as all alternative funding stream is now confirmed as in place.
ATB APR
Q3 Operational report is now well overdue so SHOULD land next week
ATB APR
GoldPlat divested GCAT as it was a non-core business ... they were always going to sell tehir stake down the only question was how much and how fast as they need the capital to invest in tehri own core business.
IMHO this is great opportunity to buy up shares into their sells ... someone will be and their hands will be much stickier!
ATB APR
@Sre Q3 Quarterly reports are taking 6-8 weeks to issue so I'm expecting Q3 Ops report (end Sept-22) next week as that will be week 8
ATB APR
@InTooDeep Frankfurt Audio https://youtu.be/ikLlj4rrwQg also mentions:
> Tanzania AND another project in pipeline
> HL processing 65-75kt ore/month when fully commissioned
> Vim Rutha is prime resource target with extraordinary results
Can someone please post link to FULL presentation with video please?
ATB APR
@Mickey Tweet deleted!
ATB APR
@bebeto Wikipedia has a very simple explanation of HL process for Cyanide extraction of gold using barren and pregnant ponds that we can see named on GCATs plan and process diagrams. We also know that GCAT uses Carbon-In-Leach process to extract the gold which it then sends to its elution plant to finalise extraction of gold Dore. Presentation page 18 shows plant process diagram for both plant 3&4 although I would expect this extraction and reprocess of barren solution to be shared plant.
HL % recoveries are how much gold is recovered from the ore not about %impurity of any dore bar produced. So 50% recovery of 1.5g/t grading rock should produce 0.75grammes gold/ton ore processed. My expectation using HL and CIL extraction process is that any dore produced will be relatively pure with few biproducts.
Precious metals
The crushed ore is irrigated with a dilute alkaline cyanide solution. The solution containing the dissolved precious metals in a pregnant solution continues percolating through the crushed ore until it reaches the liner at the bottom of the heap where it drains into a storage (pregnant solution) pond. After separating the precious metals from the pregnant solution, the dilute cyanide solution (now called "barren solution") is normally re-used in the heap-leach-process or occasionally sent to an industrial water treatment facility where the residual cyanide is treated and residual metals are removed.
During the extraction phase, the gold ions form complex ions with the cyanide:
{{Au+ (s)}+ 2CN^- (aq) -> Au(CN)2^- (aq)}}} {{Au+ (s)}+ 2CN^- (aq) -> Au(CN)2^- (aq)}}}
Recuperation of the gold is readily achieved with a redox-reaction:
{{2Au(CN)2^{-}(aq)}+Zn(s)->{Zn(CN)4^{2}-(aq)}+2Au(s)}}}{ {{2Au(CN)2^{-}(aq)}+Zn(s)->{Zn(CN)4^{2}-(aq)}+2Au(s)}}}
The most common methods to remove the gold from solution are either using activated carbon to selectively absorb it, or the Merrill-Crowe process where zinc powder is added to cause a precipitation of gold and zinc. The fine product can be either doré (gold-silver bars) or zinc-gold sludge that is then refined elsewhere.
Suspension lifted and GCAT trading again albeit with a HUGE 18% bid/offer spread so really difficult to see what a buy or sell really is
Would be good for RM to get some positive news flow going
ATB APR
@Bebeto Yes understood but if you provide 500oz of gold in a 25% purity or 85% purity Dore bar it is still 500oz of gold assuming that the by-products can be dealt with by the processor.
Not sure where you get 8% NSR from ... could you explain?
ATB APR
@Bebeto As you know I am the first to point out that the level of information in the quarterly operational reports has been reduced with Q3'21, Q4.21 and Q1'22 being information rich and Q2'22 being information poor. However, that is not the same as what you are implying with recent 'omission' regarding the CLN from the accounts which clearly needs to be explained as it was not previously announced via RNS and is clearly material.
IMHO I think the BoD needs to provide/resolve:
> funding issues for Kilimapesa expansion plus Nyakafuru mine build with a clear plan, timeline and breakdown
> revised Kilimapesa JORC compliant MRE
> clarity on Kilimapesa and plant & mine plan to hit 24koz by end Mar-23
> Retire recent CLN
> Reissue clear diagram of licence areas for both exploration and mining licences from Cadastre
ATB APR
@Bebeto Dore bars get smelted and assayed with miners being paid for the metal content minus a fee for processing, just because bar contained other metals does not mean the ounces of gold produced get 'discounted' as you are suggesting plus other metals also get a 'credit' so also get sold.
ATB APR
We also know that the MRE as per Jun-22 RNS gave us 10-year LoM at 24koz production by increasing confidence levels of existing resources based on Batch 1&2 infill drilling but added very little new resources. Batch 3&4 was expansion drilling around Kilimapesa mine around historic and artisanal mines so this will be NEW resources to expand the MRE to support the future move to 48koz/annum production profile.
Updated MRE was due end Oct-22 ... when you're ready then Robbie !
ATB APR