Member Info for aprogerson

@TornadoTony Agreed, but I wasn't expecting a production cut albeit relatively modest 5% to a not so modest 15% cut compared with FY2020 actual production as per todays RNS !
"Forecast gold production for FY 2021 of 48,000 to 54,000 ounces (FY 2020 actual production: 56,864 ounces of gold)"

Reading between the lines AAZ are being open and honest about the situation whilst laying out the worst case scenario for FY2021 with some indications about how they might address to loss of Ugur production but nothing definite at this point albeit some horizon scanning which is scant comfort for a producer.
(1) Possible for FY2021 "A recent visit to the Vejnaly contract area in Zangilan has identified some high grade ore stockpiles and the feasibility of transporting this ore to Gedabek for processing is being evaluated."
(2) and for FY2022 "We are looking forward to starting to reap the benefits of this exploration with production next year from Avshancli."
Hopefully some 'Plan B' updates involving Vejnaly ore processing sooner rather than later will restore some confidence.
ATB APR

My sense with the 'hurry up deeper drilling' is it is (a) sensible for ARCM to do it regardless of AAL and (b) sensible to do it for AAL deal as it adds to confidence about what is down there to justify whatever it is that NvS is asking for. If as I suspect it is a high price then that 'confidence' drilling becomes central to answering any 'doubt' that AAL might have expressed as you would expect their commercial team to do anyway.

Any way you look at this increased confidence in geology, metallurgy, grade, extent, depth et al is a good thing for ARCM as that is EXACTLY what the JORC (inferred, indicated & measured) methodology is based on which is used to underpin resource evaluations the world over ... so no surprises really and helps ARCM deal or no deal !
ATB APR

JORC based model and valuations Ref: (pages 15,16 & 17) https://www.valuewalk.com/wp-content/uploads/2015/06/Valuation_of_Metals_and_Mining_Companies.pdf

@Viable Interesting read and not good for the Majors in Peru.
The 'other' Castillo being ? Castillo Copper (CCZ) also with Zambian copper exploration licences or some other?
ATB APR

@TornadoTony AAZ has a really strong uptrend support in place since Mar-2020 having been tested a few times & has held. It has been tested again today and PX currently is sat on this support .... hopefully holds into close. POG has also completed a double bottom @$1,677 and sat at $1,746 so I'm hoping that is supportive of AAZ SP.

Anyone know what AAZs dividend policy is ?
ATB APR

Yes GUN seems to be long periods of quiet interspersed with frenetic activity when new investment made or IPOs.

I suspect Low6 will be 'Fast & Furious' whilst Rincon will be more 'Thelma & Louise'. Our other investments just seem to have nice steady positive newsflow whilst their SPs rise. If they can keeping adding shareholder value I'm good with that !
ATB APR

Nice RNS, nothing particularly new but lots of additional evidence to support drill targets being the right ones !

Check out page 3 and 4 for copper heatmap and 3d model visualisation https://www.castillocopper.com/asx-announcements/
ATB APR

@Mcadder Fingers crossed for licence approval soon whilst we still have some April left !
ATB APR

@Akhtar I am a goldbug so I am biased, but moving to copper focus was best thing that ARCM could do at that part of the commodity cycle given the lack of funding available pretty much irrespective of metal involved. On balance I do feel that ARCM ought to stick with current copper-focused strategy and see it through what will be a transformational few months.

ARCMs next steps will be (almost) wholly dependent on 'transaction' outcome where NvS will be playing off competing calls for CAPEX and OPEX spend across licence areas. I do however think that fast-tracking of the Kalaba plant to secure a dependable £20m+ FCF revenue stream ought to be in the top slot after 'do the best deal or not' has played out.
ATB APR

@Akhtar Interesting point, but 9 months ago we weren't ready for a Plan B, but thanks to AAL coming along it has galvanised ARCM and SP rise has allowed us to get 2 decent Placing under our belt at higher SP than we might otherwise have done.
Deal or no deal ARCM is on sound footing with lots of options and all good ones
ATB APR

@Small_Holding Interesting suggestion and one that would fit with NvSs approach so far being entirely consistent with '0, 10 or 20-bagger' and creating long-term shareholder value' particularly as they are such large shareholders themselves.

As an added twist I am convinced now that NvS is covering any downside IF no deal is or can be done to NvS satisfaction as:
> Cash = Placing for £2m (12-Jan-2021) so now fully funded for 2 years
> CASA deal = extra $5m in the bank (ARCM has no control over timing)
> Revenue = Kalaba Scoping Study & plant > £21m+ FCF within 2 years
> New Deep drilling = increased confidence of mineralisation & grade at depth
> Placing & new licences = £1.5m to purchase Alvis, Botswana Copper prospects, so covering risk that AAL want all of Zaco and/or Zamsort to avoid ARCM becoming a cashshell

Logically NvS will be in no rush to do a deal with AAL UNTIL the drilling results are in as in can justify a higher asking price and/or better JV terms as deposit will have been derisked. Campaign includes airbourne geophysics, interpretation and then deep drilling so this is not a 'quick and dirty' drilling campaign as it will be a few weeks before drill targets can be confirmed.

Just my two-pennies worth and interestingly CASAs US$5m (£3.6m) CLN pay out would cover NvS near-term shopping list:
(1) £1.2m purchase of 75% of Alvis in lieu of ARCM shares from Kapore
(2) £2.4m for acceleration of Kalaba plant study & commissioning plus LOTS of loose change for even more drilling
... and we still have possible upside from Sturec resource upgrade from MetalTech to look forward to !
ATB APR

@Lukeytukki I tend to stick talking about MCap rather than SP when making comparisons or future forecasts otherwise too many variables! So GWMO is currently £8m MCap with SP 0.25p so a rise to 1p implies an MCap of £32m.

For some perspective:
> Hummingbird (HUM) - MCap £77m producing 100koz gold with AISC $1,300 based in Mali. 2x near-term expansion prospects (2-3 years) taking this to 200koz+
> Arc Minerals (ARCM) - MCap £68m sat on 2x Tier 1 Copper deposits in Zambia grading 0.6%+ Copper. Awaiting AAL deal
> Castillo Copper (CCZ) - MCap £25m drilling out shallow super-gene 15%+ copper 'Big One' deposit. Maiden JORC within 6 months. Had a rough 6 months was MCap £60m before Xmas !!

GWMO is unusual in that it has both pure play copper and gold/silver prospects. Their copper deposit is JORC compliant, but really needs to be grown to be commercial let alone compelling. What would be fantastic is if they could identify a local partner that already has operational copper experience and existing plant then the CAPEX requirement becomes academic and the economics change massively.

If you want to see some numbers about just how much free cashflow can be generated even with 0,5% Cu grades then take a look at ARCM 'Scoping Study' RNSs for CAPEX circa £600k costs, 0.5% Cu grade and £21m+ free cashflow generation from their own ore within 2 years now they have their own small scale plant commissioned and ready to go.

What I do know is that having an ability to generate your own revenue for an exploration firm makes an enormous difference as dilution can be dramatically reduced or even avoided. Look what happened to OMI when its mine in Uruguay went bust as grades plummeted and were forced into a JV or go bust.
ATB APR

@tornadoTony I wouldn't wait too long as Gold seems to have put in a double-bottom on 8-Mar and 30-Mar at $1,676 reconfirming as support. It has now moved through 20 DMA and is now toying with the 50 DMA @$1,750, but should be an interesting few days as Gold looks to be firming up despite the dollar strength with:
20 DMA = $1,731 ... tested, sat on & moved through 1-Apr to 6-Apr
50 DMA = $1,751 ... testing today
100 DMA = $1,806
ATB APR

Impressive update as Low6 continues to scale with IPO still on-track for Q2 ASX IPO.

@AG1989 I have used Interactive Investors (II) for my ISA funds and invested directly in ASX listed Rincon as the shares have been bouncing around a lot over the last 2-3 weeks. I managed a few cheeky low 'Buy Limit' purchases, but the shares have been firming up as activity gets underway at Laverton with Hasties geophysics & drilling to follow over the next 6-8 weeks (my guess).

My sense is this will be a slow burn over the next few weeks as activity picks up, but I am expecting it to bounce once Hasties news flow starts.
ATB APR

@burtonD Nice interview with PR who is on good form:
> Rincon - large strategic holding, results eagerly anticipated on South Telfer drilling
> Eagle Mountain progress - multiples growth to date and more drilling to come
> Rogue Baron - still holds 25% expects strong growth as USA opens up after Covid
> Low6 - pre-IPO invested £265k & expects IPO late Apr-2021 to deliver multiples on investment
> Anglo-Saxony - expects strong growth as Tin in structural deficit and AS well located

Rincon updated on 5,000m drill programme at Laverton project for Apr-2021 @ https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02360456-6A1027304?access_token=83ff96335c2d45a094df02a206a39ff4

In parallel Rincon are now conducting further exploration at Hasties, South Telfer prospect and will announce follow-on drill programme in due course.
Looking good
ATB APR

Excellent news ... summary is:
> New tenement to north of Big One extends by 23% to 980km2
> 21x targets overall with 11x new targets Gold / Copper / Cobalt targets around Mt Oxide
> Geology & Geophysics team deployed to Big One & then Arya
> Drilling to follow Geophysics team & act on results
Looking good
ATB APR

LOL @PennyDealer On the contrary I'm very surprised they let them go for 4p when the ACQUIS market price was 8p ... obviously either (a) very stupid or (b) have a very good use for £160k raised.
No prizes for guessing your choice

@bamfman That's the Plan !

@JTD Absolutely agree. Most Junior gold/silver producers have taken a 40-50% hit since the Aug-20 POG highs, but interestingly explorers have dropped far less as they are mostly cashed up after capital raisings over the last 12-18 months.

I find AAZ fascinatedly as it is clearly a producer, but has only dropped circa 20% which echo's my view that AAZ is actually a growth 'explorer' stock, but with far less risk/downside due to its very welcome dividend and revenue from its now highly profitable producing mines. This gives AAZ a MASSIVE advantage over most junior explorers I know considering excellent exploration results at Gedabek (RNS @1-Mar-21) ... the bonus is these new areas of high-grade mineralisation are near the existing producing mine reducing both cost & timescale to bring online.

Hardman's valuation of AAZ presumes 69k GEOs at $1,600 POG and gives SP=181p or 28% uplift on an 'As Is' basis. Ref: https://www.hardmanandco.com/research/corporate-research/february-2021-investor-forum-2/

The biggest 'known unknown' is the Soutely licence, Zod gold and silver mine producing circa 120koz gold pa which even if it can be brought back onstream at half its throughput would double AAZ output. The bonus is that we know it has been producing and that it is largely intact, but we will need to await resolution on access, share of ownership and access to processing plant to be ironed out. Frustrating perhaps but far cheaper and quicker than building a mine of that size from scratch!

If $1,700 POG holds then AAZ will do very well, but even a drop to $1,600 is what was realised last year without any of the new licence areas being declared or progressed which bodes well for 2021 ... Production guidance for 2021 is now overdue.
AIMHO APR