Member Info for Bickmaster84

Hawaii,

Yes, I recall GR mentioning in London that understanding what is and is not a good offer was a challenge and he was seeking input from an engineer to assess what Zulu should be valued at compared to its peers. That was some time ago and I am sure the Arcadia sale will have helped considerably.

An auction to see a few % to cover the DFS would be one way of finding out and would reduce the amount of time needed for engagement with the prospective bidders. There is nothing like an auction to drive competitive bidding.

Would be beneficial to be more progressed with the DFS before going down this route though as currently we have very little to show and that would impact price.

Bickmaster

Acker

I agree the RHA issue is not new. But why go anywhere near it when there is a much bigger fish to fry. Tungsten prices aren't where they need to be to take on the risk of trying to make it work again. With current prices and making the assumption PREM could run it profitably (quite an assumption given they have never been able to do this in the past, despite numerous attempts), you would be looking at a few years just to pay the cost of getting it back online. Anyone who things PREM can get RHA up and running for less than $4m just doesn't understand the industry or working with mining equipment which has sat idle for a number of years and never ran correctly in the first place. That would be the profit on approx 80k MTU assuming sale price of $300/MTU and production price of $250/MTU. A much better solution would be to sell RHA for a few $m if someone would buy it for that and use that on the DFS. And retain the $20m costs of RHA on the books so the losses can be offset against profits from Zulu . Even if PREM were to get 90% or 100% ownership I don't think it will do anything positive for SP given how much of a nightmare it has been in the past and it would have a negative impact on SP. Indeed it is more likely to have a negative impact as shareholders will know the money that should be spent on getting the DFS done will be diverted to RHA.

That's my honest view on RHA anyway. MNH will be just as much of a money pit as well.

Its all about Zulu. Everything else is an expensive loss making sideshow.

Bickmaster

Redandy

You mention 'all of the good news in the press and on this board'.

Playing devil's advocate and taking a step back, has there actually been any good news about PREM on this board recently? All of the positive news on here is a result of activity taking place in the market. Apart from the appointment of the COO, PREM has delivered nothing but delays in the last 2+ months. It would be easy to reduce the uncertainty about MNH and RHA but GR has instead increased this.

I think this is the reason SP is going nowhere.

Bickmaster

What a shame GR spent the cash on covering his buddies' running costs at Circum in 2017/18 rather than progressing the Zulu DFS over the original area covered by the licence. I would like to think he can now see that was a very poor decision and the focus needs to be entirely on Zulu to get DFS completed ASAP to monetise the asset. Unfortunately though, it looks like his attention is on RHA again as well as the MNH moneypit.

Need assay results here asap or we will be going back to the 0.16p levels.

Bickmaster

M_Night, you’re a joke.

Acker

I wouldn't bank on Lithium prices being higher in 12 months than they are now. It may well be that they are. But I would take a more conservation approach and assume they will be the same as they are now. There is of course also a risk they are lower than they current are and that we are experiencing a spike and more supply coming to the market in the next 12-24 months will have a downward impact on price.

Bickmaster

Acker, I agree.

It will also be interesting to see what happens with LIBS going forward. If it continues to provide erroneous results then it would be better to get rid of it and get everything verified externally, even if it costs more. Like I posted last night, I place $40m of value of the current mcap on Zulu. The potential (based on Arcadia) is to increase this to $420m and this will cost approx $10m, so ever dollar spent on Zulu should see a return of $38 based on the numbers above.

Bickmaster

Indeed, he was a plague on PREM. Didn't have a clue about company fundamentals and posted about the company hitting £1. Hasn't even hit a penny. Yet.

One for the filter button.

The scale of yesterday's news was originally lost on me. Potential here is to one the US's Top 10 producing oil fields and possible top 5. It also has the potential to double the amount of oil Wyoming produces.

https://en.wikipedia.org/wiki/Petroleum_in_the_United_States#Top_oil_fields_in_the_U.S.

Bickmaster

Edgy,

He’s not in a position to play hardball as he doesn’t have any results.

Acker,

Can't agree with you on RHA and MNH as PREM does not have a bottomless pit of money to spend on them and needs to spend the money where it will provide a return to shareholders.

RHA has been a disaster. $20m down the drain. The ownership issue is somewhat of a red herring given PREM would have the call on the profits until its investment is paid back. Would definitely need to spend $3-4m on RHA without knowing whether it will ever break even. GR is emotionally attached to this money pit, hence why he can't let it go.

MNH, others have tried and failed and are clearly trying to offload this because they cant make it work. Significant logistics issues. Why go anywhere near this when it needs significant capital investment and margins are unproven. At London GR called MNH a 'potentially profitable' mine. Potentially profitable = loss making.

Bickmaster

Steward,

I agree wholeheartedly.

The key concept to realise is that PREM has the ability to self fund the remainder of the Zulu DFS out of existing share ceiling. Why give away more % now to raise funds for RHA and MNH when Zulu provides a much better payoff. This is Corporate Finance 101. If you have a number of investments to choose from you go for the one which provides the greatest payoff. MNH and RHA definitely do not tick the box in this regard and any logical investor would focus all £ and efforts on Zulu.

Bickmaster

PREM is currently valued at £38m, which is approx $50m.

Let's assume $40m of this is Zulu and the other assets are worth approx $10m.

All going well, with a successful DFS, in 12 months Zulu could be worth approx $420m (using Arcadia as a comparable). The potential increase in value over the next 12 months is approx $380m, or approx $1m per day. And it should only take $10m in costs to get us to that level (i.e. pay for the remainder of the DFS). So there will be a payback of $38 for every $1 spent.

On the other hand you have MNH and RHA, both of which have never turned a penny of profit despite 2 previous parties trying to make MNH work and PREM pumping $20m into RHA over a number of years. Why would anyone touch the two of these with a bargepole , let alone PREM when Zulu needs to be progressed. Spend some money on them after Zulu. But let's not lose focus on Zulu. Everything else is a side show, and potentially a very expensive sideshow. Snowking's answer that there will be money to do anything GR want's doesn't wash with me. MNH and RHA are the kind of projects you avoid whether or not you have money. But GR wants to progress MNH to bail out his Uramin buddies and wants to try to make RHA work to prove it could be done.

Bickmaster

M_Night,

So, if we don't need 20,000m, how much do we need?

George doesn't know himself because he needs to get verified assay results which will inform the DFS modelling to get to the 60-80mt target. By taking this approach any schedule acceleration from saving a few thousand metres of drilling are offset by having to wait for the verified lab results and the modelling of the resource to be completed to ensure it is in the right ball park.

So, at this point in time, if PREM are targeting getting Zulu to 60-80mt there is no way the can set out how much drilling is required to get that. Which in turn means there is no control of the programme.

This is the difference between a GR interview which is full of potential, conjecture and jam tomorrow and the obscure carp he provides in his RNSs.

Bickmaster

Indeed, "all you need is a dfs and good forecast and it is pretty easy to do in this climate". That is what we are missing at the moment and are a long way off completing. Wednesday is the 10 month anniversary of receiving the EPO and we have only drilled 6000m and only have unverified results for less than 200m (i.e. one hole). But "all you need is a dfs and good forecast and it is pretty easy to do in this climate" and we can "Get market cap up to $200m".

Bickmaster

Snowking.

2. Get market cap up to $200m and then go to banks and get a loan for say $80 m with a pay back in three years. Or do a jv for 50%

Not being flippant but do you really think it is that easy?

Bickmaster

Thanks for clearing that up Snowking. Good to see everything is still rosy and PREM will have so much cash it can do whatever it wants. We know how well they have spent the cash in the past.

Bickmaster

My current view of the world.

Positives
1. New COO appointed though he doesn't have any lithium experience.
2. Level of interest in Zulu.
3. Decent volume today.
4. Recent Arcadia sale.

Negatives
1. No clarity on MNH.
2. No further results.
3. COO's CV much more suitable to RHA development than Zulu progression.
4. RHA being back on the table will detract from focus on Zulu and no doubt will receive funds which should be directed to Zulu.
5. Comms still leave a lot to be desired (June Presentation posted today).
6. The 40 other areas of interest outside Zulu. These should be left until Zulu is complete. Plenty time to look at them when there is $400m in the bank.
7. Strategy still up in the air. GR doesn't know what he wants to do with Zulu. JVs with the Chinese often don't work out very well for the JV partner. Outright sale may be advantageous.
8. SP still sub 0.2p.
9. DFS likely to take another 12 months - lots of time for GR to get bored and lose focus.

Bickmaster

Steward

I am not aware of anything due to happen on the 14th. I believe this is just another guess from our resident rampers.

With the exception of the Arcadia sale (which is a huge positive) nothing of substance has changed here in the past few months. Still a massive lack of delivery by PREM, uncertainty over MNH, poor comms and the same ole team.

Potential here is huge but delivery is sadly lacking.

Bickmaster

Have a look at the Angus Energy RNS from this morning. I wonder if a similarly worded RNS from PREM in the next few weeks would have a positive impact on SP. I have no doubt such work is taking place in the background. It would simply be a case of formally telling the market about in via a RNS rather than painting the pretty picture in an interview, which holds much less weight with investors.

If I was in GRs position and I was looking to drive SP up it is what I would do.

Bickmaster