Member Info for aprogerson

@BluBay Please re-read the 2x RNSs on the OCIM and Philoro funding as both are for GCAT to sell them a fixed %production at SPOT price minus a small discount/refining fee to cover the lenders costs & fees. Contrary to what you said this means that GCAT can ...
1) Make a profit as $spot - $discount -$AISC = still a very healthy profit at circa $1,150 AISC @$1,750/$1,800 POG
2) Still has capacity to raise further non-dilutative capital on similar terms on at least 80% unencumbered production
> OCIM = 15% of production
> Philoro = 3-5% of production (my guess)
3) Cash position now £11m over next 3-4 months as per RNS terms to fund push to 24koz/annum production
ATB APR

RM Tweet ... "Well done to the Caracal team #fullyfunded#gcat#OCIM#Philoro. Vim Rutha results and Kilimapesa project economics this week ????????????"

So2x RNSs this week then
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So todays position at Market open will be ...
GCAT MCap = £13.2m versus secured cash position of total = $13.5m or £11.07m

Cash funding detail ... secured against future gold production at small discount to spot and/or refining fee
> OCIM Tranche #1 = $7m or £5.74m ... by 31-Dec-22
> Philoro = $3m or £2.46m ... by 31-Dec-22
> OCIM Tranche #2 = $3.5m or £2.87m ... by 31-Mar-23

IMHO this now totally derisks GCAT to 24koz/year gold production from Mar-23 and will likely allow GCAT to accelerate development at BOTH Kilimapesa mine and Nyakafuru mine development project.
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ShareTalk always have something interesting to say and what stood out for me was this "Work has been underway since March to expand production at Kilimapesa to the promised 24,000oz of gold per annum, with a focus on processing the lower grade ore being mined from the Kilimapesa Hill deposit through a heap leach processing facility with a capacity of 65,000tpm."
We know Plant 3 = 3x 15kt pads and Plant 4 = 2x 6okt pads, but Charles Archer stated this as 65kt/month which implies a 2-month average cook cycle. Maybe Q3 Operations report will update us on Heap Leach usage and % recoveries?!
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@Trek well said
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@RCMP I admire your optimism, but we need to find it first as we cannot spend a target!

The very good news is when we find new mineralisation we know from history that it is likely to be high grade and near-surface plus we can process it ourselves and we also know we have gold that can be processed from existing tailings that someone in the past has thoughtfully brought to the surface and crushed for us so GWMO 'just' need to shovel it out of a shallow pit.
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@Trek Interesting but looks like OCIM is a straight sell at spot and OCIM make their margin on a discount to spot price so little or no financial engineering involved. Not sure if it is 15% of whatever GCAT sells and/or when this kicks in, but I guess we will find out after Q4 operational report when sales and margins will be declared for the period in which the OCIM deal landed.
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@RP Okay, my bad I know that they are reconfirming JORC and had assumed was via drilling. So drill or relog we will get a reconfirmation of JORC so all good either way!
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We are still in the 0.625/0.875 channel we have been stuck in since May-22 when 0.875 strong support from Mar-22 broke. We have strong support/resistance at 0.625, 0.675, 0.725 and top-channel resistance at 0.875.

IMHO we have had a HUGE amount of shares changing hands over this period and PIs have gone from 0% to 34%+ as per OCt-22 presentation plus another 10% held by Gary McDonnell. We have now had GoldPlat sell down the balance of their shares AND we now that circa 300m warrants due to expire in Dec-22 at 2.5p will likely be out-of-the-money. I still believe we are in the accumulation phase of GCAT development and the SP is unlikely to move without major positive news BUT we no have no major seller and no new warrant shares due to be created so ownership is likely to tighten.

Major newsflow:
1) Updated MRE including expansion drilling at Maghor and Vim Rutha ... was due end Oct-22
2) Nyakafuru phase #1 drill results to confirm prior 659koz JORC ... derisking and increase in confidence
3) Q3 Operational results ... weeks overdue, gold produced, HL %recovery, Plant upgrade confirmations & timeline
4) Nyakafuru Reefs update ... was dropped, but if deal back on adds 400koz JORC
5) Nyakafuru phase 2 drill programme details and start ... yes please !

All looking very good and any of above newsflow should move the SP up as downside risk continues to recede
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@Bebeto Suspension is usually only used for major stuff like new funding, missed accounting, takeovers and such ... we've had our funding announcement unless you're aware of something unusual in the pipeline?
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Crazy moves up and down between 0.875 and 0.675 on very high volumes over last few days indicating lots of shares changing hands hopefully to stickier hands.

Todays volume 15m versus 155m 4 days ago ... so really modest volume so far today but large drop & recovery
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Lucky find filmed by German investment group DGWA from early Aug-21 about 4 weeks before RTO .... https://www.youtube.com/watch?v=tvp8xPCSgdA

Really interesting watch
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I hope GCAT can pull their collective finger out and post the Q3 Operations report as it is now 9 weeks since end of Sept-22 period end ... normally they are 6-8 weeks post period end and would be good to get a view on ....

Kilimapesa Operations & development
> gold production & sales
> plant output, plant upgrade progress & %recovery especially for Heap Leach as no update since Pilot plant 53%
> mine output and development
> Next steps and timeline

Resources:
> Kilimapesa expansion drill programme progress (batches 3&4)
> Nyakafuru Drill programme #1 completion and results ETA
> updated MRE status ... due end Oct-22
> Next steps and timeline

OCIM Funding ... summary with more details of deal terms and discounts to spot, term et al
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@Bebeto Sticks and stones if you have a specific issue be specific rather than just generically try to discredit everything I might have posted ... at least I share my data, assumptions, references to specific RNSs and happy to take criticism onboard and update my thesis as facts change. Any production estimates I may post are clearly IMHO but still representative of data provided by RNSs, Oct-22 presentation, quarterly operational reports, WGC & JORC guidance, all available interviews and independent research.

I don't pretend to be right and I am also clear what is 'factual' and where things are my opinion and why I think something is or maybe so ... can you say the same?
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@Bebeto Yes broadly agree with you on amounts of ore to feed standard and HL plants and that this is in excess of current mining and exploration licences assuming a 24koz/month rate of production. However we do know that RM mentioned an aspiration to upgrade Kilimapesa to 50koz/annum which would effectively halve those LoM figures and might explain the push for regional exploration around the existing Kili plant especially as the JUl-21 prospectus identifies Kilimapesa hill as low grade suggesting a move to source and mine higher grade ore from Vim so upping the gold output from the same upgraded plant for the same OPEX and again driving down AISC?

Grade is king after all
ATB APOR

@Bebeto Sure a difference of opinion is healthy and drives a bit of creative tension, but for me posting figures without a supportable narrative or exposing your base assumptions & calculations your refer to makes it an opinion or just a plain assertion ... which is okay but using facts mixed with your unsupported assertions to give them validity is not helping anyone.
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@Bebeto Just because the Oct-22 presentation says 2koz/month production split 50% from Plant 1&2 and 50% from Plants 3&4 does not make your other arguments or figures about AISC true because you are basing it on a $1,694 Cost per ounce figure from Nov-21 RNS which in GCATs own words say "During this phase of replenishment, optimisation and capital investment total costs are not considered representative of the budgeted ongoing costs of the operations" I'm not sure how more plainly I can put it.

In terms of what a likely Kilimapesa AISC may be when GCAT hist 2koz/month in Mar-23 we only have RMs $1,100/ounce to go on versus Q3 Operational Report from Nov-21 RNS of "Operating costs of US$985/oz were achieved in September 2021" ... these are probably 'cash costs' and do not include sustaining costs which is typically exploration cost to maintain the project MRE after the mining operation has consumed some of the resources.

For Kilimapesa my argument is that $985 costs/oz was for 596oz produced via Plants 1&2 and is likely to fall with an upgraded plant whose throughput has been doubled and %recoveries improved. Also consider that the MRE implies a 10-year LoM so that GCAT can mine 24koz/annum worth of ore for 10 years before fully depleting the resource, but we also know that expansion drilling is underway so that a revised MRE is more than likely to increase this LoM significantly. All this reduces future AISC costs & not increase them as the capital investment is being made now albeit the implications of it are not apparent to most investors as reflected in the super-cheap MCap.

Heap Leach AISC is much harder to define as GCAT have given very little information on Plant 3&4 sizes, %recovery for various cook cycles or cost per ounce figures; we can however assume that HL will have lower OPEX than Plant1&2 albeit at much lower %recoveries ... the trade-off is not clear as GCAT have been very tight-lipped about it.

What we do know however is that at 24koz/annum production GCAT has a 10-year LoM and from Nov-21 RNS stated $985/oz cash costs for 596oz produced via Plant 1&2 ... so an enlarged Plant 1&2 running at full tilt should cost LESS per ounce not more and anything from the Heap Leach will also cost less/ounce than Plants 1&2 as it has lower OPEX.

So for me the REAL question is how much do GCAT need to spend on sustaining costs going forward to produced 24koz/annum from a mine with an existing 10-year LoM and an imminent MRE that should increase this by some margin with Vim grades expected to be higher which itself will drive cost/ounce down?

Knowing the base cost/ounce is a real comfort given a high LoM as additional replacement drilling becomes optional if/when POG drops removing lots of possible downside risk for me.
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@Bebeto The November RNS you are referring to was from Nov-2021 and stated:

§ Gold sales of 569 ounces ('oz') achieved in September 2021, a 7.6% and 20.0% increase on gold sales recorded in August and July 2021, respectively.

§ Operating costs of US$985/oz were achieved in September 2021.

§ Total costs of US$1,694/oz were reported in September 2021. This includes the all-in sustaining costs and also the planned capital expenditures at the Company's underground mining operations and gold processing plant and acquisition of new equipment, purchase of increased stores and mine and plant consumables and exploration equipment. During this phase of replenishment, optimisation and capital investment total costs are not considered representative of the budgeted ongoing costs of the operations, which are expected to be more representative at the end of Q4.

So let's break this down ...
> Gold sales of 569oz, no production figures so lets assume sales = production = 569ozs
> Operating Costs = $985/oz for Sept-21 which was Plant 1&2 only as no heap leach was been built until Mar-22
> Total costs were $1,694/oz so the difference of $709/oz *569ozs = $403k as stated for Sept-21 only

However RNS goes on to say that $1,694 total costs included AISC plus other costs such as:
+planned capital expenditures at the Company's underground mining operations
+gold processing plant
+acquisition of new equipment
+purchase of increased stores
+mine and plant consumables
+exploration equipment
... put another way this STATES that these additional costs were NOT part of AISC AND then goes on to confirm that "During this phase of replenishment, optimisation and capital investment total costs are not considered representative of the budgeted ongoing costs of the operations".

You could then conclude that these additional non-representative costs could be higher or lower but this is academic as they are clearly not part of AISC as per the Nov-21 RNS. Not sure how these figures could then be cast forward to infer Heap Leach costs, but happy for you to break out your assumptions and related calculations
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@Bebeto Okay we'll just agree to disagree then as it looks like you are just making several assumptions based on your prior assertions particularly as Heap Leach is not yet online in any meaningful way let alone producing 50% of current gold production as you suggest; plus not sure how you conclude then RM is talking about the future 2koz production AISC when this is by definition a backwards looking calculation unless of course he said 2koz production at end Mar-23 with Target AISC of $XYZ ... which I am not aware he has done.

Got tired of saying that exploration costs linked to expansion are not part of AISC calculation, but everyone to their own I guess. Please read WGC AISC guidelines .. https://www.gold.org/about-gold/gold-supply/responsible-gold/all-in-costs.
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@Bebeto Sorry I have been and keep referring to Free-cash-flow (FCF) not profits and anything outside of FCF is profit. I am afraid it is not me that is confusing things. Please read WGC AISC guidelines .. https://www.gold.org/about-gold/gold-supply/responsible-gold/all-in-costs.

I am uncertain about some of your assumptions namely:
> Exploration $500/ounce ... only counts to AISC if it is to replenish' mined ounces as in 'sustaining' costs andything outside this that results in a more than 10% increase in resources is 'expansion' and by WGC AISC guidelines is NOT included in AISC. The recent MRE clearly both expanded resources AND improved confidence so much so that this increased LoM from 2 to 10 years, not sure how this can be part of AISC costs

> Part of GCAT historical 2021/22 accounting costs will be for Nyakafuru project legal expenses, purchase cost, funding costs, licencing, Phase 1 drill programme et al. These are nothing to do with Kilimapesa AISC and to suggest otherwise is misleading as AISC is always counted on a project-by-project basis ... check out any multi-mine listed Major for their AISC stats. These costs come out of FCF and should not be part of it as you are suggesting as they are a different asset.

> I am uncertain as to the treatment of Aug-21 RTO costs or Feb-22 fundraising costs where AISC is concerned, but these are relatively small compared to the other costs mentioned

> Operating cost, cost per ounce and AISC are all very, very different things which is why WGC has guidance to stop it being 'gamed' by companies and sets out for listed companies how they should calculate things

My simple view is that GCATs FCF can be used for a variety of things outside of sustaining an existing mine and according to WGC will EXCLUDE expansion if it results in more than 10% growth plus as AISC is quoted per operational asset it will also EXCLUDE anything to do with Nyakafuru.

Profit is what is left over and may or may not be the same as FCF (I'm not an accountant!) but clearly GCAT is using its FCF to fund multiple things which are clearly expansionary otherwise how would it get from circa 470oz/month average since Aug-21 RTO to 2koz and over from Mar-23? ... those expansionary costs should not be part of AISC as per WGC guidance. Hopefully once GCAT is done expanding they may decide to declare a dividend at some future date but this is most likely when GCAT is a very different mid-tier beast,
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