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Here is a key line from the Vanchem Acquisition Presentation issued today.

"Our resource and processing facilities provide significant potential to expand production capacity to 10,000 mtVp.a."

Beautiful.

Slide 6 also now looks like a beast of a slide demonstrating the potential and scope of the BMN assets.

We debated here tirelessly why last year the enclosed map highlighted Witbank, Middelburg and the transport links to them. It was a big indicator in my view of where this was heading and now it is confirmed. It is of course the home of the Vanchem assets.

I have said for a long time that it makes no sense building a new and expensive processorout in the middle of nowhere where there is no infrastructure, no power, no water and no labour. That directed me to towards believing that any new processor would be positioned at Brits if anywhere at all.

However, the very best option to ignite Mokopone was always going to be a brownfield processor and "transporting a crushed, screened and dry magnetic separated ore from the Mokopane deposit to the Vanchem Business (a brownfield processor) for further beneficiation."

But most important of all here is for me slide 5.

Some contributors here have been questioning BMNs ability to deliver on the goals that it has set out across its fully integrated model. Today's announcement demonstrates very clearly that when BMN say they are going to do something, when they go as far as placing it in writing andpresenting it to the world, however limited the details may be, they generally get it done.

They have been saying they are targeting 10,000mtV in the medium term for about 15 months.

They have been saying they are targeting 200Mwh electrolyte and 1,000MWh energy storage opportunities by 2020 for a lot longer. In the case of the VRFBs it is over 3 years.

They have never waivered from this course.

Today they have effectively delivered the the production target. What does that now say about those other targets? Who out there is willing to question their targets, question their plans or doubt the distance they have highly likely already travelled along their individual paths to completion? Not i for sure.

http://www.bushveldminerals.com/wp-content/uploads/2019/05/Acquisition-of-the-Vanchem-Plant-SAJV-Business-and-Ivanti-Shares.pdf

Good morning all,

Thank you for the positive comments. It is however important to remember that there are many excellent contributors here who bring a varied number of new and enlightening pieces of research to the table. I feed off this information just as much as anyone.

The surety of the Vanchem transaction comes from the many months of debate and research that Ophidian, I and several others shared in trying the determine the first source of brownfield being sort by BMN in S.A back in 2015. Without that debate and the contribution of other members of this BB, we would never have got to where we did in the end or indeed where we find ourselves today.

What makes me smile the most is the fact that we spent all that time debating whether it would be Vametco or Vanchem, having no clue that this then little £8m mining junior actually planned on having them both.

And the beauty of it all is that BMN effectively paid for Vametco using it own inventory. That transaction in turn has delivered the revenues that now allow them to pay for Vanchem.

Two mines, Two processors, 4 kilns, all fully refurbished for a total cost of just $181m, producing 9,200mtV, making BMN the largest producer of vanadium outside of China.

When we started here BMN were heading towards a Mokopone PFS that would ask them and us to find $300m just to get started, and we were excited.

Take a look at us now.

@Roscon With the greatest of respect to everyone that is involved in the markets, this whole debate is utter nonsense.

BMN as an investment is not built on when newsflow occurs but the fact that there is news to be had.

Everything that needed to be in place to set BMN on a path to a very nig outcome has already been achieved. Securing 74% of Vametco and enjoying what has been 15 months of substantial cash flows is the foundation and springboard that BMN needed to drive the true story and value for shareholders.

Any recent fall in the vanadium price comes too late to prevent that from happening.

The Q3 Vanadium Update will be remembered by most for all the negative things that happened at Vametco. However, the most important statements that were made in that update were these ;

"The successful completion of the acquisition of Sojitz's interest in Vametco has enabled us to accomplish our objective of achieving maximum ownership of the asset."

"With the completion of most of the corporate action aimed at maximising Bushveld's ownership of Bushveld Vametco, the Company can accordingly now focus on ensuring maximised production output and efficiencies at Vametco."

Add to that the following statement from FM's Christmas message in Dec 2018 ;

"The Vametco acquisition gives us a solid platform from which to execute our vision of building a large, low cost vertically integrated vanadium platform, supplying more than 10,000 mtV of vanadium to the global market."

Securing 74% of Vametco delivered the key component to allow all of the other plans to be realised by allowing BMN to do what it wnats when it wants with its Vametco cash flows, but also drive vametco harder and faster knowing it wasn't merely upping its own purchase price. You don't carry out repairs on a new house before you buy now do you?

Sojitz only happened in Sept 2018. That's just over 6 months ago. That is nothing compared to the time it takes to build a business and put real deals to bed, and I am thinking mainland Europe not S.A.

BMN has told the world what it plans to do and it has signalled that the completion of Vametco and the ability to remove Sojitz from the picture with one payment, is the springboard to that all of what now comes from that success, and i has nothing to do with vanadium prices being where they are today.

So let them spring.

@Spbhoy Perhaps we are all missing something. Nothing is a 100% cert in life and certainly never in investing.

In my view that is not the case here. BMN is a very solid and strong medium to long term investment. The days of trying to get into production when prices were against us are long behind us. That problem is now somebody else's and their future struggles will be to BMN advantage.

This period we find ourselves we have seen before and it was far darker than this will ever be because back then investors were fighting for their financial future and the vultures were much bigger and much badder.

No two investing situations are ever the same. Fundamentals, moods, markets, all change. However, the strength of the position BMN now has to ride out any storm and take advantage of the rain it brings is momumentally better than when they were a minnow trying not to get eaten up.

That is what everyone seems to be forgeting. BMN will expand and grow and get better and cheaper at producing vanadium. If prices stay low they will take advantage of that be it through cheaper possible expansion that replaces pure plays juniors who cannot build, or through VRFB take up driven by affordable vanadium. It is win/win for a company with a foot already firmly in both camps.

Those shouting that vanadium is too expensive and needs to be cheaper for VRFB take up cannot have it both ways. When the price comes down the VRFB count goes up.

BMN is building the only electrolyte facility in the entire Southern Hemisphere and plans to expand it to be the largest in the world. The price of vanadium falling helps that.

BMN is tendering for the largest battery project in the world at Eskom. The price of vanadium falling helps that.

If the price of vanadium rises then the ability of the electrolyte and VRFB arm to win work comes into question, if only a little. But then the profits from Vametco start to rise and the valuation drives higher based on pending larger dividends.

Somewhere in the middle would be even better and even more successful. If BMN and us poor old investors have to carry a year or so of 'reduced' profits to achieve it. If I have to stare at an SP of 20p 18p 16p for 12 months whilst I wait for it, do I really care? Will BMN go out of business? Will the pittence cost of the electrolyte plant prevent it from getting built. Will the BESS Project be lost? Will BMN fail to get to 5,000 mtv in anticipation of the next big vanadium wave?

No, they will not. . . and there lies the problem. Impatience and a mind hell bent on convincing oneself that something must have been missed.

As an example I ran an exercise on SLP the other day to try to establish how AIM is valuing Bushveld Complex based miners in 2019.

SLP Example EV = £15.4m + £91.4m = £106.8m v EBITDA of £18.9m = EV/EBITDA of 5.65

Expect average full guidance to hit 74,500 oz this year, which would lower the EV/EBITDA rate slightly.

Growth over next 4 years aimed at delivering approximately 85kt of production by 2021, which would be an uplift of circa 15%.

ESTABLISHED KEY DIFFERENCES BETWEEN SLP and BMN

BMN own a far greater resource and plan expansion by end of 2020 of up to 76% when future 5,000 mtv name plate operates at 90% (4,500mtv).

It also plans to be producing value accretive electrolyte from ‘early 2020’ and will this year reveal more of the plans that achieve 10,000 mtv in the medium term.

The company is also now in the process of delivering its 2nd VRFB battery installation and will tender for the Eskom BESS Project.

Brits Project offers further substantial cost savings.

Total reserves far outweigh SLP.

BMN also has a DFS completed mine to power coal project that is 100% owned.

That is what is actually known rather than planned on paper with no actual timelines, visible actions or costs etc associated with it.

There is nothing wrong with SLP as a company. They look like a very solid outfit from where I am sitting but they are no BMN. Yet their EV/EBITDA ratio is currently better than BMNs even though they deal with exactly the same S.A. issues that BMN are supposedly saddled with and BMN has a universe of added potential and future prospects.

On 24th April I posted a long explanation on where I felt EBITDA was heading for 2018. My figure for BMN share was circa £59m.

ARC Capital who for me have produced a far more compelling borker note to that which SPA insist on banding around, set BMN's EV/EBITDA based on expected 2019 earnings at a "undemanding" x 5.3.

BMN valuation is currently £271m + (approx) £18m (74% of £26.2m minus est expenses since Sept) = £299m

That equates to EV/EBITDA for 2018 of 5.

However, ARC openly admit that they apportion only nominal value to Brits ($25m) and Lemur ($10m) and only assign $5m (0.3p) cash to their valuation. The above EV includes £17m, which equates to approx 1.5p.

Most importantly they don't even list Bushveld Energy under their valuation, nor do they entertain any additional brownfield other than the expansion of Vametco to 5,000 mtV, which isn't valued in their latest note.

So against 2018 EBITDA BMN is already undervalued according to the ARC method of analysis with Brits, BE, brownfield and Lemur all to come.

Plus a EV/EBITDA of x 5.3 is based on a vanadium miner operating one asset. Not a fully integrated vanadium platform with access to a full value chain of revenue streams.

If the comments that i saw on this BB from the IC are to be believed then the updated CPR is first and is due in May, followed by the Feasability Study in June. I assume that if the IC felt confident enough to go to print on these dates then they must have talked to someone in the know.

The updated CPR is designed to confirm the potential upside of the remaining 2 satellites on the Anchois field. These being Anchois N and NW.

The other 3 satellites have already been appraised and have the potential to turn the current 423Bcf of recoverable resources into circa 680Bcf. However, Anchois N in particular has the potential to significantly increase this with over 200Bcf in recoverable resources currently being indicated by the company.

Whilst the FS will be the major announcement of the two, the CPR really shouldn't be underestimated because 900Bcf is a very significant field indeed given the close proximity of the satellites, coupled with the low valuation base we are currently still witnessing.

So the CPR given it is on th Anchois field, has the ability to really drive home the view that this field is a very substantial indeed.

@knutsfordnotary That is certainly starting to be seen in China where the size of the gap is starting to make it worthwhile. It isn't however a tap that just gets switched on and off. It takes a few weeks. It may well be happening in the US where the current price difference is still aroudn $14 per kg but haven't found any evidence to support this to date.

Following the standing ovation received for the last Evraz production report, I thought I would indulge the BB with another one.

The enclosed report is for Q4 2018. Page 5 once again deals with the average FeV prices for the European and US.

I would draw your attention to the 2018 average figure. European FeV was $81.28 per kg. BMN remember stated the 2018 avrage MB figure as being $81.20 per kg. So effectively the same, so Evraz figures can be trusted for future BMN reports (H1 being the next one).

The US figure came in at $86.29 per kg. At 60% of sales to the US that would place the year average (calendar not BMN 1 month lag) at $83.75 per kg. So not all that big a swing ($2.50 per kg) because the 2 figures were on average only $5 apart.

However, in Q4 they were $10 apart and in Q1 that gap moved to nearly $15 per kg apart.

That is a lot more significant because it pushes the Q1 average much further away from the European price at circa $9 difference, if the 60% sales level has indeed been maintained.

We cannot prove that right now but to ignore i and simply focus on what Europe is doing is also wholeheartedly wrong.

http://www.evraz.com/investors/production_results/EVRAZ%20Q4%202018%20trading%20update_final.pdf

40 minutes ago I posted the Evraz Q1 production report that stated that Q1 average prices in Europe were above $73 per kg and US prices were touching $88 per kg. Yet the discussion continues to centre around news flow and anything but that report.

That in part sums up very well how sentiment can be distracted away from what is really important, onto things that are not so.

The talk is all about shorting, sellers, and devious MMs, when perhaps it should be focused around the perception that the market thinks that vanadium prices are having a substantial affect on profitability. That the continued downtrend perhaps points to a longer term trend that reduces the current value of the company as a pure vanadium miner with no other avenues of potential.

The reality is that the vast majority of investors here are here for a much bigger story than just short term vanadium price fluctuations. They believe in a plan that will see production increase to at least 5,000 mtv, with visions of 10,000 mtv, and a future energy storage arm that has sufficient potential and grounds for optimism, that it is worth riding out such short term thinking to see how it all turns out.

Nobody can claim that the market is valuing BMN on much more than what it does as a 74% Vametco owner and nobody can blame it until the company starts to deliver the developments that are clearly taking place in the background. Silence does not take those developments away however much the market may react to it or try to persuade that it does.

To say we need news flow implies a lack of patience that will be an investors downfall in the end. BMN only needs newsflow if it is planning a major dilutive placement, which i do not see.

BMN has a large investment war chest that is being aimed at substantial growth and a low cost energy storage platfrom that creates high yielding processed products. So what is generating all the concern?

If BMN get anywhere near to those Q1 average pricing figures and a good solid production result, then they take yet another giant step towards making all of their plans a reality. If investors believe that those plans are real, that they will be even just mainly implemented and it will come at minimal dilution at best, then the sum of all those parts make the current valuation laughable and a little patience will allow it all to fall away and a brighter future to be realised.

Without wishing to confuse anyone with a wave of numbers. It is important to remember that the $82 per kg figure is the Q1 period average, not the BMN realised average. For that we would need to add in 1 monht of the Q4 figures, which is difficult to calculate but unnecessary.

The reality is the $82 per kg figure is the base because Q4 offers a much higher addition given the sizeable uplift in averages for that period. Even when accounting for a partial drop off in November/December.

All in a very healthy result.

For those that may be getting downhearted by the constant retreat in the European feV mid price, it is important ti understand that BMN realised prices will be affected by where they sell their product.

There are visitors here that focus in on the European price and employ this as a means to cast doubt on the investment case.

But then that's like calculating a North Sea oil operator's profits against WTI prices, it simply does not fit.

BMN's biggest market is the US, hence my efforts to try to analyse the shipments their over the last 15 months or so.

The enclosed Q1 production update from Evraz includes (as it always did when they controlled Vametco) both European mid prices and the Ryan Notes US prices too.

Whilst we must not forget that BMN " is based on the prior month's average price" it is still very clear to see that during the last 4 months or so when prices have been retreating in Europe, the US price has held up far better.

Page 6 of the report states European FeV prices for Q4 2018 of $108.60 per kg and Q1 2019 of $73.33 per kg.

Where as the US is coming in at Q4 $118.65 per kg and Q1 $87.90 per kg.

NOTE - These numbers are far higher than I have been able to record through the various reports that come out on a weekly basis.

If BMN have maintained their 60% sales to the US and are achieving US prices, which given they are trading there and it has nothing to do with Europe whatsoever would be most prudent, then they should be enjoying far better prices than I have certainly been appreciating and a near $15 per kg swing in the States.

At 60% US sold that would place the Q1 average at $82 per kg.

That is non too shabby.

http://www.evraz.com/investors/production_results/EVRAZ%20Q1%202019%20trading%20update%20%20final.pdf

James0309 yes it very much looks like i have made an error on the tonnage. I had assumed that they were being recorded in mtV but that now appears to be incorrect..

I take your point regarding the shipping date. I had thought about this yesterday towards the end of my analysis and decided to ignore it because I could not define the time period for how long the goods would be sat at the port awaiting clearance to leave the country. Nor could I properly define the time it would take (rail/road) for the goods to travel to the port. However, you are absolutely correct the shipping date should be the date at which the goods leave Vametco and we should be thorough.

Given that the two shipments that are closest to the start and end of the 2018 shipping year are both 26th Jan, something has to givegiven what I have just said. One could argue that 4 days (26 days minus average shipping period of 22 days) is enough to time to ship the goods by rail, but they have first got to get to the rail, then be booked in to various locations, and I doubt very much that vanadium is delivered to port just in time, particular when departures times can be adjusted. So I now think the 26th Jan shipments should be pushed into the previous year.

That makes the revised 2018 total shipment 1,617.9 tons of Nitrovan = 1,229.6mtV

Q1 would then be adjusted to 510 Nitrovan = 387.6 mtV

That places Q1 total production at 646mtV

If for some reason the 26th Jan shipment did leave Vametco in 2019, then as it is a comparably big shipment (75.26 tons), then we are back at 444.8mtV and Q1 production in line with your figure of circa 742mtV.

I would point out that whilst the 60% figure was the 2018 average it has no true significance for what we are attempting to prove, it is merely the best we have to work with.

For instance, in my calculations yesterday I showed that BMN shipped on average just 53.25% of their total production to the US in H1 2018, despite this being their strongest period in the year. If we remove the 26th Jan shipment then this falls even further. It was only Q4 that really delivered the uplift in shipments that drove the total sum to circa 60%.

Thus we are sufficiently far enough away from clear definitive data that the guesstimate really carries little worth.

Therefore, the key really is the other point I made yesterday relating to the percentage of shipments in 2019 compared to 2018. Even if I deduc the 26th Jan shipment of 75.26 tons, we are still at 61% of the total shipped in H1 2018 when overal production was running at 2,800mtV.

At just 50% of H1 completed, that points to a stronger result in either realised prices or increased production across the board, which is good to see.

@Bigsmoke apologies i did not see your replay as we crossed over. The reports are to the 29th April but they run one day behind. Therefore, the 29th April report is for oil pumped upto and including 28th April.

@Bigsmoke the April production table states AMER total barrels at 97,749 for 28 days, which should come out at 3,490 bopd.

Good morning all,

Whilst i do think the positivity is justified and good to see, the enclosed monthly throughout paints a slightly different picture.

It shows a drop off on 26th April to 2,012 barrels then a ramp up to 5,303 and 4,590 over the next 2 days, which tempered the one day drop off. The total average throughput for April thus far is 3,490 bopd, placing average production for Q2 at around 6,000 bopd.

But it is rising. The April throughput figures include the first 2 sluggish days of April, which managed on average just 2,065 bopd. Since then throughput has been consistently much higher but for the 26th April and the average continues tom creep upwards.

http://www.controlhidrocarburos.gob.ec/wp-content/uploads/2019/04/Prod-Mensual-Fiscalizada-29-ABRIL-2019.pdf

The question from James0309 got me thinking about the Executive Blog Christmas message and a statement that I remember from it.

"The Vametco acquisition gives us a solid platform from which to execute our vision of building a large, low cost vertically integrated vanadium platform, supplying more than 10,000 mtV of vanadium to the global market."

"This growth will come from not only Vametco but our other vanadium assets too and will see Bushveld producing a range of vanadium products, including nitrovanTM, ferrovanadium and vanadium electrolyte for vanadium redox flow batteries (“VRFBs”)."

The key word in all of that is Ferrovanadium.

James0309 for whatever reason the company talk about mtv but the sales figures listed under the Q2 and Q4 updates do not indicate that the comlany is producing any more Nitrovan than the mtv figure that they quote. They may gain a premium on it which may in turn be cancelled out by sales commissions or discounts. Whatever the case the 2,560 mtv is vanadium in the form of Nitrovan. If it were anything else then the sale prices would be coming in well below the FeV prices and that would not make sense.

However, like I say you have set off a light bulb in my head.

The FM Christmas message states that BMN's other assets will assist with the expansion to 10,000 mtv and that said 10,000 mtv will include ferrovanadium.

Right now Vametco does not produce Ferrovanadium, it produces Nitrovan. Whilst a localised expansion to 10,000 mtv, which included Vametco and Brits, would deliver the statement from FM, I do not see the worth in Vametco being expanded to produce Ferrovanadium, when it has the rights to produce a far superior and better priced product in the form of Nitrovan, which is exactly the reason why Vametco produces that and that only. It is what makes it stand out as a producer in the first place.

Therefore, I cannot see Vametco ever wishing to produce Ferrovanadium. So logic says it must be planned to be produced at another site.

We are talking brownfield additions here so no new greenfield processor for the moment, and the company is clear that they are staying local.

The only local producer of ferrovanadium that i can find is Vanchem. Yes it can produce other chemicals and even vanadium pentoxide flakes when asked but then Vametco produced vanadium oxide (MVO) prior to BMN buying it but it doesn't anymore.

I have recently started to go off the idea of Vanchem giventhe words from BMN were pointing towards a $100m further investment in Vametco. However, Vanchem was always my forst choice after Vametco driven by the lengthy discussions ophidian and I had about which brownfield was going to be the first target back in 2015. vametco won that day but now no matter how many times i seemingly try to ignore it, Vanchem remains the very best bet and most suitable target, and i did say that until it is out of the shop window it is still very much on.

Perhaps it is more on than we realise

@James0309 All of the figures are already in the form of Nitrovan so there shouldn't be anything to convert.

See 30th Jan Vametco Q4 update where it states ;

"Vametco's production for the 2018 financial year was 2,560 mtV (2017: 2,649 mtV) in the form of NitrovanTM from magnetite concentrate"

http://www.lse.co.uk/share-regulatory-news.asp?shareprice=BMN&ArticleCode=3xjdwuy7&ArticleHeadline=Bushveld_Vanadium_Q4_Operational_Update

The only reason that FeV is talked about is because the main market price that BMN quote if European FeV, even though they state that only 16% of their total sales were made there in 2018.

See slide 10 below.

http://www.bushveldminerals.com/wp-content/uploads/2019/04/March-2019-Corporate-Presentation.pdf

Afternoon everyone and thank you once again wolfi_at for the video.

Having listened to it myself I noted he talked about the construction start of 2020 assuming the programme was made this year, which given the 28.04.2019 release date I would say is modt likely. He also stated there was 375,000 tons "lithium metal" deposit spread over German (one third) and Czech Republic ( two thirds). I am struggling to see how this figure ties in with the latest resource update from 9th Oct 2018.

It is another positive find as we await the two project updates.

http://www.lse.co.uk/share-regulatory-news.asp?shareprice=BCN&ArticleCode=jahytwzz&ArticleHeadline=NI43101_lithium_resource_at_Zinnwald_Project

Sorry just appreciated that it didn't all fit on the page.

Here's the rest

(3 of 3)

Whilst I cannot say exactly what percentage of the sales are now being carried out in the US, what I can say is that there is a lot to be positive about with the current figures. Either Vametco has boosted production significantly or it has changed focus and is hitting stronger pricing markets with more materials. If so then the comparisons and predictions that are employing just European feV mid prices could be considerably out when the H1 figures come out in Sept.

In my opinion, Vametco isn’t shipping 80% of its total production to the US because that would leave just 132 mtv for their other customers of which some will be long term. It is more likely that Vametco is expanding its sales in the US through progressive sustainable production, which means we should see a much improved figure once they are released. At an educated guess I would say something north of 750 mtv could well be achieved going off what I have found. The question will then be how much is from inventory and how much from actual production but again I don’t see Vametco upping sales if it isn’t sustainable. The shipments as far as I can see contain very regular patterns, which lends itself to known agreed quantities, so any uplift I would expect would come through knowing that it isn’t merely a one off. The Q4 uplift in sales was more than just making up for Q2/Q3. It was, I believe, a definite ramp up knowing more was to come.

We shall find out soon enough.