Member Info for aprogerson

@Greg I have no opinion on the Jul-2022 to Jul-23 production figures given in the June presentation as there are too many moving parts as RM points out.

What I have done is do a bottom up analysis and I am assuming that Plant 4 pad 1 will come online before Dec-22 to allow them to hit the 2koz/month target which seems to be the alternative approach now taken as Plant 1 & 2 upgrades has now been delayed to Q1'23. We know Plant 4 pad 1 is now under construction so must have been paid for already BEFORE the $1.75m CAPEX figure given by RM.

On that basis Kilimapesa does not look like it needs any new CAPEX until 2023 and the Plant 1 & 2 upgrades commence. I agree that Nyakafuru will need OPEX for drilling, but if you see my calculations then this is likely to come from Kilimapesa FCF. I have no idea what CAPEX Nyakafuru may need as CAPEX, OPEX and timelines have not been announced.
ATB APR

@Greg I can't account for those figures and they are not explained in the June presentation ... all I can do is take what we do know or can reasonably assume and work from there. GCAT have said that they have completed Plant 3 and are now building Plant 4 plus we know Plant 1 and 2 will now be upgraded in Q1'23 so it can work full tilt until then hence my figures which are conservative.

I could be wrong and have missed or misunderstood something which is why I welcome feedback. I am not saying they won't want to raise new money on the back of an updated MRE, but I am saying that I don't think that they need to unless you can convince me otherwise?
ATB APR

@Suggins I also asked about Red Ray and Bao Mining licence but also question was not put to RM.
Not the best organised Investor Presentation I've seen
ATB APR

@Greg Using Expected configuration, grades and plant we know is in operation and/or coming onstream. Details lifted from my Analysis yesterday but using Q1'22 grades and 2/4-week HL cycle so lower %recoveries

Expected Steady State Production & growth Q1>Q4'22:
Onstream Q1 > Q4'22 before upgrades in Q1'23:
> Plant 1 Process & Plant 2 Tailings CIL = 15ktpm x2.5g/t X0.91% /31.1 = 1,097oz ... assumes 20 days/month operation

Onstream in Q3'22 as reported complete Q2 - assume all 4x 5kt pads
> Plant 3 Heap Leach = 4x 5kt = 20ktpm x1.72g/t x0.535% /31.1 = 592oz

Assumed onstream in late Q4'22 as reported in construction Q2 - assume only 1x 30kt pad operational:
> Plant 4 Heap Leach = 1x 30kt = 40ktpm x1.72g/t x0.535% /31.1 = 888oz

So anticipated production:
Q2 = max 1,097oz/month from Plants 1 & 2 only "possible" vs. 900oz "best guess"
Q3 = max 1,689oz/month from Plants 1, 2 & 3 only "possible" vs. 1,200oz "best guess"
Q4 = max 1,689oz/month from Plants 1, 2 & 3 only "possible" vs. 1,500oz "best guess"
Dec-22 = max 2,577oz/month from Plants 1, 2, 3 & 4 (1x 30kt pad) only "possible" vs. 2,000oz "best guess"

So I think I am being cautious & not over-hyping anything! Let's see
ATB APR

@Greg I understand your concern but I see no evidence to support your view. We know from RM last week that they have $1.5m cash and we know $1m is needed for Nayakafuru deal leaving $0.5m cash, We also know that AISC is $1,250 from RM and POG is circa $1,800 giving $550 FCF per ounce on circa 850ozs Q1 production per month before HL came onstream so I am expecting Q2 production to be 900oz+/month.

We know Exploration costs = $300k/month until at least Dec-22 so assuming modest production growth as capacity comes onstream and Plants 1, 2 and 3 now running at full tilt whilst Plant 4 is under construction ...

Q2 FCF = 900oz x $550 = $500k/month -$300k exploration = $200k/month surplus
Q3 FCF = 1,200oz x $550 = $795k/month -$300k exploration = $495k/month surplus
Q4 FCF = 1,500oz x $550 = $825k/month -$300k exploration = $525k/month surplus
Dec-22 FCF = 2,000oz x $550 = $1.1m/month -$300k exploration = $800k/month surplus

Of course this is only IMHO given what we know but above SURPLUS is after ALL Admin, production & exploration costs assuming modest production growth to stated Dec-22 target so surplus should grow into Q3 and Q4. So residual Cash =$500k and growing $200k to $800k/month AFTER all costs and Nyakafuru project payment with output GROWING into Q3/4 to 2koz/month in Dec-22.

Not sure I see the problem or the "Hole" you are referring to?
ATB APR

@Greg Yes appointment of Paul Reeves was no accident and he knows how to structure CAPEX investment and associated funding as well as being credible enough with funders/banks to structure something that works.

Bottom line is they need the Kilimapesa 'Cash Cow' setup and producing reliable revenue streams at low AISC ASAP then GCAT will be rolling. Looking at the numbers today I now have very high confidence that the 24koz is achievable at modest AISCs given grades demonstrated, historical grades found, roll-out of mine and processing upgrades at speed to date and having a very capable team recruited.
ATBA PR

From memory we had about 17.5kt of copper metal @$8k/t so that is $140m or £116m revenue assuming we can get it all out but as grade is relatively low we would be lucky to recover 50-60% of that on processing assuming we used toll processing which is costly.

From memory the drilling also identified other nearby copper resources, but not enough drilling was done to show continuity so it could be incorporated into the JORC.
ATB APR

Fingers crossed Chisler
ATB APR

@ID78 LOL, no need anything above 2.5g/t will go to Plant 1 & 2 so gets 91% recovery and goes straight to profit as costs already covered. I've proven where all tehir numbers come from and shown they are based on 20-May-22 RNS for Q1'22 Operations Report so ignoring any upside for plant efficiencies and scaling up all of which will drive AISC down and profits up.

All very good from where I am sitting, confirms why I am heavily invested and looking to add
ATB APR

I think I deserve a lie-down now
ATB APR

Revised Conclusions from todays analysis & posts below

Plant 1 Process & Plant 2 Tailings CIL:
1) Ore & Gold production are per Q1'22 & include 8% risk contingency for downtime and/or grade slippage
2) Assumed grade of 2.5g/t ore and combined 91% recovery as per Q1'22
3) Plant 1 & 2 running full-tilt to Dec-22 then taken offline for Q1'23 upgrades from 15ktpm to 30ktpm capacity

Plants 3 & 4 Heap Leach:
4) Plant 3 HL will configured as = 20kt or 4x 5kt pads running 3-month "Irrigate & Cook" cycle @1.72g/t ROM ore feed
5) Plant 4 HL as = 120kt or 4x 30kt pads running 3-month "Irrigate & Cook" cycle @1.16g/t ROM ore feed
6) Heap Leach Plant efficiency - stated Q1'22 %recovery = 53.5% for 2 weeks cycle, so increasing cycle time to 3 months improves "S-curve recovery vs. time cooked relationship" to 65%-75% BUT efficiencies NOT baked into gold output

Mining Output to support 24koz/annum target:
7) Q1'22 mined ore output was 67.6kt/Qtr or 22.5ktpm and Jun-22 model requires 77ktpm or a 2.4x increase

Target 24koz/annum by Dec-22:
8) Target 2koz/month gold production very achievable with Plant 1, 2 & 3 at full tilt plus at least 1x 30kt Plant 4 pad with Heap Leach on 30-day cycle or more 30kt pads on longer cycle time

Updated MRE:
9) Plant 4 HL modelled on 3-month cycle implies 1.16g/t ROM ore so cut-off grade applied to MRE likely to be dropped below current 1g/t cut-off and will therefore increase overall JORC resources

ATB APR

So in reverse order you've seen my Conclusions and demonstrated that steady state 77ktpm ore processing works IF the Plant 3 & 4 HL pads use a 3-month "Irrigate & Cook" cycle as it improves gold %recovery.
However, slide 11 Gold production figures across Plant 1, 2, 3 & 4 don't make much sense ... or do they?

Steady State Production:
> Plant 1 Process CIL = 10,525oz/year or 877oz/month
> Plant 2 Tailings CIL = 1,621oz/year or 135oz/month
So combined ... Plant 1 Process & Plant 2 Tailings CIL = 12,146oz/year or 1,012oz/month
> Plant 3 Heap Leach = 2,343oz/year or 195oz/month
> Plant 4 Heap Leach = 9,585oz/year or 799oz/month

Expected Steady State Production from Q1'22:
> Plant 1 Process & Plant 2 Tailings CIL = 15ktpm x2.5g/t X0.91% /31.1 = 1,097oz
> Plant 3 Heap Leach = 4x 5kt = 20ktpm x1.72g/t x0.535% /31.1 = 592oz
> Plant 4 Heap Leach = 4x 30kt = 120ktpm x1.72g/t x0.535% /31.1 = 3,550oz

So figures for Plant 1 & 2 combined imply a 8% contingency (1,012/1,097) or 1.6 days downtime/month. However figures for Plants 3 & 4 HL are very different as:
> Plant 3 presentation stated vs. Q1'22 = 195/592 = 33% or 3-month cycle time per pad @1.72g/t
> Plant 4 presentation stated vs. Q1'22 = 799/3,550 = 22.5% or 4.5-month cycle time per pad @1.72g/t or 3-months at lower grade circa 1.16g/t everything else being equal

Nominal Production Output by plant ... using Q1'22 data & assumed 3-month HL cycle & Plant 4 with 1.16g/t ore:
> Plant 1 Process & Plant 2 Tailings CIL = 15ktpm x2.5g/t X0.91% /31.1 = 1,097oz ... 92% match
> Plant 3 Heap Leach = 4x 5kt = 20ktpm x1.72g/t x0.535% x33.3% /31.1 = 197oz or 49oz/pad ... 99% match
> Plant 4 Heap Leach = 4x 30kt = 120ktpm x1.16g/t x0.535% x33.3% /31.1 = 800oz or 200oz/pad ... 99% match

Bingo ... the steady state numbers in the Jun-22 Presentation now imply:
> Plant 1 & 2 = Q1'22 grade ore @2.5g/t & 8% risk contingency for 1.6 days outages and/or 2.3g/t ROM ore
> Plant 3 HL = 3-month "Irrigate & Cook" cycle with Q1'22 grade ore @1.72g/t
> Plant 4 HL = 3-month "Irrigate & Cook" cycle with lower grade ore @1.16g/t

In Summary:
1) BIG difference is the implied 3-month "irrigate & Cook" cycle for Heap Leach used to boost Steady State efficiencies from 53.5% stated to (my guess) 65%-75% BUT have NOT been built into Jun-22 model & imply considerable upside
2) Plant 4 Heap Leach has been modelled to accept lower grade ore @1.16g/t ... this implies that the MRE cut-off grade will be lowered below 1g/t significantly boosting JORC resources AND therefore accessible ore
3) Steady state processed ore required was 77ktpm and Q1'22 ore produced was 67kt as follows:
> Plant 1 & 2 from Underground = 18,357t @2.64g/t
> Plant 1 & 2 from Open Pit = 26,489t @2.33g/t
> Plant 3 & 4 from Underground = 22,744t @1.72g/t
4( Q1'22 Ore produced grades match ore processing grades and numbers and gold output in Jun-22 model

Mystery now solved & lots of production & MRE upside implied but not include

Ore Processed from Jun-22 Presentation page 11:
> FY2022/23 = 6 months to Dec-22 & 6 months to end Jun-23 = 582kt
> FY2024 & FY2025 = Full 12-months steady state = 924kt or 77kt/month

Nominal Production Capacity by plant:
> Plant 1 Process & Plant 2 Tailings CIL = 15ktpm
> Plant 1b Process & Plant 2b Tailings CIL = 15ktpm ... available Q2 after Q1'23 upgrades
> Plant 3 Heap Leach = 4x 5kt = 20ktpm max
> Plant 4 Heap Leach = 4x 30kt = 120ktpm max

So where does FY2024 & FY2025 @77kt/month steady state come from & why?

Ore Required by plant with 'revised' HL Process Flow:
> Plant 1 Process & Plant 2 Tailings CIL = 15ktpm
> Plant 1b Process & Plant 2b Tailings CIL = 15ktpm ... available Q2 after Q1'23 upgrades
> Plant 3 Heap Leach = 4x 5kt = 20ktpm max, but on 3 month "irrigate & cook" cycle = 6.6ktpm
> Plant 4 Heap Leach = 4x 30kt = 120ktpm max, but on 3 month "irrigate & cook" cycle = 40ktpm

Et voila moving to 3-month HL "irrigate & cook" cycle AND upgraded Plant 1 & 2 = 76.6ktpm ore requirement or rounded up = 77ktpm ore processed (spooky)

So slide 11 figures for Ore Processed at 77ktpm steady state are not random and indicate that GCAT will sensibly transition HL to a 3-month "irrigate & cook" cycle across its Plant 3 4x 5kt pads and Plant 4 4x 30kt pads ... this will moderate ore required by the combined plant to the stated 77ktpm and significantly increases %recoveries from the Q1'22 HL pilot plant figure of 53.5% to an expected 65% to 75% recovery. This increased % recovery has NOT been reflected in their gold production figures as I will show.
ATB APR

@JC No your numbers are correct ... I used previously consensus estimate of POG @$2,300 in my analysis, however where I do differ is that I think AISC will go down as production goes up as some OPEX costs are fixed irrespective of gold production (as shareholders in producers with mine outages will tell you when AISC goes through the roof). My target AISC is $50 to $100/oz lower when we hit 2koz/month especially as HL is proportionally lower OPEX/ounce.

Put more simply when GCAT :
1) rolls out Plant 1 & 2 upgrades output will double from Q2'23 but costs will not so AISC will drop
2) rolls out Plant 3 & 4 capacity & process flow upgrades with proportionally more output from HL then AISC will drop as HL OPEX lower per ounce than Plant 1 & 2 OPEX/ounce
So when AISC drops the profit/ounce produced goes up

Producers are heavily geared to metals price as we know from watching POG go down but applies equally the other way. What investors are NOT factoring in is that PGMs as share of investor PFs are at historic lows of around 0.5% with mean being around 5% and highs being 10-15%.

Currently Crypto, equities, bonds and cash all being heavily punished by inflation with only gold being marginally up. Any reversion to the 5% mean will see MASSIVE inflows into gold & silver producers ... any return to historic high 10-15% ratios will be life changing for investors due to underlying gearing to metals price. I consider Nyakafuru gold in the ground as being an option on future higher gold prices, but only costing GCAT $5-6/ounce to acquire.
ATB APR

GCAT Presentation (p11) shows GCAT ore production and then Gold output for each of plants 1, 2, 3 & 4 broken out by 2 time periods FY2022/23 (Jul-22 to Jun-23) and the FY2024 plus FY2025 being identical. Ref: https://caracalgold.com/wp-content/uploads/2022/06/Caracal-Gold-PLC_Corporate-Presentation_JUNE-22-FINAL.pdf

I have been scratching my head all week over this slide as the numbers "appeared" to make no sense so I posted my "Bottom Up" numbers to show what was possible by Plant based on RNS @May-22 Q1 Operations Report numbers. So either I've misunderstood something very badly or the slide is trying to "tell" us something but just not explaining it.

As you probably gathered I like analysing stuff and once I'd crunched the numbers, sliced & diced them plus looking and comparing run rates overlaid with their known work programme using Q1'22 ore grades & efficiencies AND the need to hit 2koz/month production in Dec-22 some VERY interesting things became apparent.

My conclusions:
1) Plant 3 Heap leach will configured as = 20kt or 4x 5kt pads
2) Plant 4 Heap leach will configured as = 120kt or 4x 30kt pads
3) GCAT figures for Ore & Gold production are accurate but include 5-8 % risk contingency
4) Heap Leach Plant cycle - move to a 3-month "Irrigate & Cook" staggered across 4 pads in each of plant 3 & 4
5) Heap Leach Plant efficiency - stated Q1'22 %recovery = 53.5% for 2 weeks cycle, so increasing cycle time to 3 months improves "S-curve recovery vs. time cooked relationship" to 65%-75% BUT efficiencies NOT baked into gold output
6) Plant 1 & 2 output & efficiencies remain at Q1'22 gold output based on 15kt capacity & 91% combined recovery with 8% deduction for either/or 1.6 days downtime and/or grade dropping from 2.5g/t to 2.3g/t
7) To hit 2koz/month gold production will require Plant 1, 2 & 3 at full tilt plus at least 1x 30kt Plant 4 pad with Heap Leach on 30-day cycle or more 30kt pads on longer cycle time

So why do I think this ??? It's the numbers talking ... and from what I can see they can scale up the combined plant output (albeit at some %recovery loss) as ore production ramps up/varies which is a very good sign that they really know what they are doing as Q1'22 53.5% HL pilot plant recoveries are not sensible at scale and need improvement.

More detail to follow explaining WHY I think this
ATB APR

So from prior post as Q1'22 grade and throughput ... give 2.5koz/month in Dec-22:

Worst case = Plant 1+2+3 plus only 1x 30kt Plant 4 pad by Dec-22:
> Plant 1 & 2 Standard & Tailings CIL = 15ktpm x91% recovery x2.5g/t /31.1 = 1,100oz gold/month
> Plant 3 HL = 20ktpm x53.5% recovery x1.72g/t /31.1 = 590oz gold/month
> Plant 4 HL = 30ktpm x53.5% recovery x1.72g/t /31.1 = 888oz gold/month ... only get 1 pad commissioned ???
Assume Production= 2,578ozs, POG= $1,800 & AISC= $1,250 so FCF= $550/ounce
So, Free Cashflow (FCF) = 2,578oz x(1,800-1,250) = $1.42m or £1.2m/month

@ID78 I didn't bother trying to back engineer their figures as they seem way too conservative whereas past %recoveries, grades and throughput are fact and can be sensibly cast forward with reasonable confidence.

All they need to hit 2koz/month is to complete balance of Plant 3 HL and 1x 30kt of plant 4 and then just do what they have been doing with everything else in Q1 ... seems nailed on to me!
ATB APR

@OOSM I will go through the GCAT presentation separately but their website is offline this morning so it will have to wait. My Calculations so far have been "Bottom Up" given RNS data and performance to date so are a reliable place to start for any projections going forward, but of course don't figure in down time.

I suspect that the GCAT presentation figures are very conservative and therefore giving then some wriggle room.
ATBA PR

@ID78 All my calculations assume the Q1 2022 Operations Report grades of Main Plant @2.5g/t and Hl of @1.72 g/t. I try very hard to to speculate too much, but I agree that the indicated grades of surrounding targets do look to be good although processed ROM grades do tend to be low as they blend in lower grade ore.

For me this is all upside as downside risk seem to be diminishing fast especially with Kilimapesa MRE now overdue and Q2'22 Operations report some 4-5 weeks away.
ATB APR

@Greg/ID78 My very long-winded explanation excludes 5-10% profit/ounce once all plant optimised and effect of Plant 1&2 upgrade now put back to Q1/2 2023 ... so assuming I haven't 'dropped a cods' in my numbers and all planned plant has been built and upgraded BUT using Q1,2022 grades then ...

Q1'22 Grades, but optimised & all planned Production by end Q2 2023 (RNS 20-May-22 data):
> Plant 1 & 2 %recovery = 93% ... as 92% to 94% expected
> Plant 3 & 4 %recovery = 60% ... as 55% to 65% expected

> Plant 1 & 2 Standard & Tailings CIL = 15ktpm x93% recovery x2.5g/t /31.1 = 1,120oz gold/month
> Plant 1b & 2b Standard & Tailings CIL = 15ktpm x93% recovery x2.5g/t /31.1 = 1,120oz gold/month
> Plant 3 HL = 20ktpm x60% recovery x1.72g/t /31.1 = 665oz gold/month
> Plant 4 HL = 120ktpm x60% recovery x1.72g/t /31.1 = 3,990oz gold/month

So assuming GCAT do what they say they are going to do with Plant 1, 2, 3 & 4 build plus upgrades including plant and process flowsheet optimisation then by end Q2 2023.
> Gold Production 6,895oz/month or 83koz/annum

Worst Case POG= $1,800 & AISC= $1,250 ... so no change:
> Revenue = 6,895oz x$1,800 = $12.4m or £10.3m per month which equates to $150m or £123m per annum
> Free cashflow = 6,895oz x($1,800-$1,250) = $3.8m or £3.15m per month which equates to $45.6m or £37.8m per annum

Expected Case POG= $2,300 & AISC= $1,150 ... consensus POG and HL OPEX savings:
> Revenue = 6,895oz x$2,300 = $15.9m or £13.2m per month which equates to $191m or £158m per annum
> Free cashflow = 6,895oz x($2,300-$1,150) = $7.93m or £6.58m per month which equates to $95.2m or £79m per annum

Commentary:
Current MCap= £12.75m so implied Q2'23 P/E worst case= 12.75/37.8 = 0.337 or patently ridiculous for the implied cashflow or half P/E that in Expected Case assuming only current Q1'22 grades are processed! Of course IF mine plan and optimisation allows for higher grades to be processed than achieved in Q1'22 Operations then these numbers get proportionally better and %recoveries may also improve.

I also expect that GCAT have cannibalised the CAPEX they were going to use for Plant 1 & 2 upgrades on building out Plant 4 HL capacity so will continue to use FCF in Q1/2 hence avoiding requirement to come back to shareholders to fund this which would be very good news indeed!

IMHO even in Worst Case scenario with current grades continuing to be processed then a serious rerate is on the cards as this plays out ... even then lots of potential upside from better grades +higher POG and/or improved AISC!
ATB APR