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@Ophidian yes i posted very much the same thoughts when the interims came out. I also remember that the Eskom revised startegy is now due for mid November.

I would dearly like to see who is visiting vametco and in what context before I fall even further down this particular rabbit hole. But my interest is defintely stirred.

@Alfacomp do you have a twitter link please, I cannot seem to find it.

My brain just went into overdrive on the connotations of what you have just shared.

@Ophidian yes I do indeed but first of all we should have the BE Q3 update on or around the 11th Oct. I was of the mind that perhaps the delay to the VRFB demonstration battery would perhaps delay the expected unveiling of the BE business case, but it just feels like the path has been trod far further than we currently are aware of, despite my current inability to determine how large scale madates would be secured without that battery being fully commissioned and tested.

I guess nothing changes eh.

@Headancer having noted Faramog's response, I believe it is simply a case of these things needing a little longer than perhaps PIs appreciate.

Personally, I don't focus on where the SP is or what it is doing, I put all fo my energy into digging out where the company is going and what the movements are in the fundamentals. It has stood me in very good stead so far, so I see no reason to change.

The published story of BMN is a long way from being fully told, nevermind the unpublished elements, and all of that will in time be demonstrated in the SP. Its simply about remaining focused and waiting for the market to catch up.

Further to my earlier post, I have been taking anothe rlook at the Scoping Study for the 'electrolyte' facility. We are due an update from BE next week and it will be interesting to see how much further things have moved on.

1. The Scoping Report has been produced for BE, not BE and The IDC.

2. The Scoping Report is at the "Finalise and Submit Scoping Report" stage, which commenced on 22nd Sept.

3. The Scoping Report is supposed to be for an electrolyte facility but I noted that the footnotes in the document chnage after page 6 of the 76 page doucment. On page 7, which rather interestingly is the introduction page to the full document, the titel changes from 'Vanadium Electrolyte Production Facility' to 'Vanadium Based Energy Storage Production Facility' Interesting.

Then on page 22 there is figure 3.4, which describes the 'schematic layout of the proposed VRFB facility' not just electrolyte facility then.

Further evidence of this is offered in the Bushveld Energy BID document where on page 2, figure 1 is marked as being the " Locality of the proposed sites within the ELIDZ for the VRFB production facility"

The document is clearly titled as being for a proposed electrolyte facility, but if that is the case, then why does VRFB facility keep popping up.

4. On page 14 it says ; "BEC are in the process of formally acquiring site A as their preferred site within the ELIDZ and once this process has been completed, BEC will become the owner of the site."

So the plans are far enough on to warrant purchasing the site and it is BE that will own it, again no mention of The IDC.

The site itself is 10,000m2. That's a very big site for an electrolyte facility. Of course it makes perfect sense to house th VRFB facility and the electrolyte final production together, but the belief to date was that VRFB assembly comes later.

BE must be very confident of securing VRFB mandates if it is already buying the land from the ELIDZ to house the electrolyte and the VRFB assembly facility (see page 14 of Scoping Study under Site A). The question is justbhow far are the VRFB facility plans really on?

The talk from the company thus far has been all about the electrolyte facility but the documentation tells another story. What is for me clear, is that if as the company expects, large scale mandates will be secured this later this year, then they must surely be connected to the electrolyte facility going on line, so late 2019 production.

If that is the case, then it makes sense to make the VRFBs at the new electorlyte facility and not be shipping the locally beneficiated electrolyte anywhere else, because that simply doesn't work.

So perhaps the electrolyte facility has already morphed into a far greater localised beast.

Putting to one side what for me is an unnecessary distraction that these SP Angel updates seem to cause here, I would offer this.

What SP Angel do say in their latest note is that FeV prices in Europe were averaging $112.50 a kg as of Friday 28th Sept. That places BMN's Q4 average mid price (4 weeks in), at $98.70 per kg.

Therefore, an average FeV price of $101 per kg for the next 9 weeks, will deliver a $100 per kg average for Q4.

The same calculation has already delivered a Q3 average mid price of $78.70 per kg. Thus we would have a H2 average mid price of $89.50 per kg. With that knowledge and the support of the interims, it is not all that difficult to see what that means for the year end figures.

I won't bore everyone because I have serial posted my calculations based on what the H1 figures achieved.

In essence, an $89.50 per kg mid price for H2 with 1,403 mtv sold, will achieve a consolidated post tax profit of circa £58.5m. This employs the same 78.8% conversion for all EBITDA above a price of $51,500, which was the average price achieved for Q1, and is the same conversion achieved for all value above that price in Q2. The reality is it is conservative because the EBITDA conversion would continue to increase.

Thpost tax profit figure also takes into account the 66.5% conversion of EBITDA to profit, demonstrated in the H1 figures. It cannot be exact because there are other influences, but it is in my opinion, close enough for investment evaluation purposes.

There will be acquisitions to take into account, but they of course bring added value, and that is where the key difference lies for me. We can all analyse the long term FeV price until we are blue in the face, but the key is that BMN and its now unified BEE partnered ownership of Vametco, are generating sizeable profits with which to embark on their true journey. As is clearly highlighted in the interims by FM ;

"As we continue to steadily execute our firm strategy to grow into a significant, low-cost vertically integrated vanadium platform, we have a busy pipeline of corporate and operational activities ahead. I look forward to providing further updates on the operations in the second half of the year."

SP Angel can only focus in on what is the perceived reality, a mining business affected by its ability to produce and the price of the goods it sells. They can give lip service to the future goals but they cannot, as they have clearly stated, assign value at this time.

BMN is on a journey to somewhere very special and the current FeV price is providing all the ammo they need to achieve it and then some.

@dfallows congratulations to you and the very best of luck in your future. If the contributions of the collective here have in any way assisted you on your path to better things, then that can only ever be a good thing.

As we have all, all too easily learnt here, life can be hard and can so easily take away the things you treasure so dear, in the blink of an eye. We must enjoy the time we have to the best of our ability and rejoice whenever it goes our way, for we are never very far away from the next twist and turn.

As of next month, I too will be once again fully engaged with the investment world, and for the time being at least, my main focus will be on BMN. I feel the timing is very much right for what will be a new phase in the world of BMN. I look forward to sharing it with you and anyone else that is here for this journey. Vametco is now under full control, the purse strings are BMN’s to pull, and I am absolutely certain they know exactly which direction they are ready to be pulled in.

Even better SOTRR. Good work

At Brits Uitvalgrond portion 3 is already fully compliant at 65-35% ownership. The 35% is definitely BEE compliant.

Door port too but it is less relevant at this time. Uitvalgrond portion 2 was 51-49% BMN-BEE, but the website is now showing 100% BMN. This will no doubt soon enough change to 70-30%.

So all Vanadium projects are fully or soon will be fully compliant with the new rules, with nothing lost that wasn’t really someone else’s already, except the 1% at Vametco, which will add far more than it takes away.

The last document I read, and I have seen nothing that would change that, states that BMN owns 64% of Pamish Investment Nr.39 and a BEE partner the other 36%. It is this business that owns the prospecting rights at Mokopone. If anything BMN will be buying 6% not giving more away.

Never boring around here is it.

I am with you 100% there Daisan. I don’t have time now but it’s well worth digging out the Eskom requirements (Guptas aside) that it places on its suppliers. There is no getting away from BEE compliance with Eskom.

That said, the timing of I am right, should save us 4% of Vametco.

Well now wasn’t a swift move.

Gwede Mantashe today on Twitter :

“To entrench regulatory certainty for investors, and provide security of tenure for investments, an existing mining right holder who achieved a minimum of 26% -including a right holder whose BEE partner has since exited - is recognised as compliant for the duration of the right.”

I had thought they had missed the boat because I read it meant from the commencement of the new Mining Charter process. But if as I suspect it is prior to coming into force, then BMN just sacrificed 1% to gain 4%.

Given the speed of execution I think the latter applies, particularly when FM says ; “the significance of the Company's compliance with South African mineral laws and the Mining Charter cannot be overstated."

@SOTRR that is a good argument too, but why do they feel compelled to single out the battery now and set the update now? Q4 was sufficient and they could then have updated the market at the time, without setting a specific month. I don’t buy the idea that they believe the works is watching. BMN has made far more compelling move with the electrolyte facility and said nothing so far about dates of time related expectations. Just take a look at the Scoping Study and what dates do exist there, and the progress made with buying the site. Thus far not formally communicated.

Is this specific delay to the battery, a delay that was not communicated until the interims, so important to the company that they feel compelled to communicate weeks in advance, when we will hear more about it? Or is the commissioning connected to something else far more relevant and worthy of a point in time.

@pb940 I must admit I did read that article but I didn’t want to fall too far down the rabbit or indeed dare dream that such a strategy could be directly linked to BE contracts.

However, it does say ;

“The new leadership at the State-owned company, together with Public Enterprises Minister Pravin Gordhan, have formally acknowledged that the group’s business model is no longer sustainable, in light of material technology changes in the electricity sector.”

If there is a large scale mandate to be had, then it’s at Eskom, and if their is a new strategic blueprint, then the two have every right to be connected.

The BE business case cannot realistically be communicated without contracts, with these mandates, and if nothing else the company has said as much (as have I over and over again) ;

Page 16 Annual Report.

“1) Proving the Company’s capabilities and securing its positionas a developer and integrator of utility scale energy storage projects by delivering its initial projects and securing large scale energy storage mandates in Africa;

2) Positioning itself as a key electrolyte supplier, by supporting the global industry through the low cost production of electrolyte while securing offtake agreements; and

3) Securing additional strategic relationships with downstream stakeholders in the global vanadium battery supply chain and electrical power developers and producers operating in Africa.

With these developments, the company will be in a position to outline its business model, cash flow capabilities and valuation contribution within Bushveld Minerals.”

It’s all there in black and white. Dare we dream?

For those investors it onlookers who do not perhaps fully appreciate how BMN operates, here is another line from the Annual Report under ‘Identifying potential South African and international partners to jointly develop and operate the (electrolyte) facility’

“Since year end, a formal relationship has been established with an international chemicals company that has already built and is operating an electrolyte production facility outside South Africa”

The Bushveld Energy Q1 update alluded to this relationship through the mentioning of the chemical company’s experience, but it wasn’t specifically noted against the goal of finding a partner to develop and build the facility.

Many other companies on AIM would have announced this with a fanfare. In Australia they would likely have suspended the stock shortly beforehand. BMN bury it in a report, the fact that they have effectively signed up their contractor and partner, who will develop, build and operate the facility. What does that say about how far on the costings are, the plans, that business case.

@Daisydog exactly!

Did anybody else pick up on the somewhat out of place line in the interims. Under the BE update regarding the issues with the demonstration battery, something which I was most disappointed to hear, the company stated ;

“The Company will provide an update on progress in November 2018.”

Why did they say that? BE updates to date have been quarterly and the last two have both come out on 11th day of the following month. BE is more than just its demonstration battery so I would not expect that to change just because the battery has had delays. Nor would I expect that the company would a. Feel the need to report on its progress directly or b. Specify in advance when they would provide this update.

The wording on the repairs refers to Q4 only with no mention of November being key, nor a programme of key events being provided.

It is of course welcomed, but it isn’t the norm, they haven’t been doing that. Why give such a date out so easily, when they don’t need too, Q4 would have sufficed.

So what is so special about November. Is that perhaps the timing of the BE business case announcements. After all BMN may look like they issue news as it comes about, but that is definitely not what they actually implement. For me the year is planned out and the goals under their control very much attainable.

Remember what the Annual Report says ;

“Finally, the company expects in the second half of 2018 to be in a position to outline its (Bushveld Energy) business model, cash flow capabilities and valuation in Bushveld Minerals”

Remember remember November.

@Daisan I hear you loud and clear and agree. But I don’t need to see a business case to know that the most cost effective way right now in SA, is to exhaust the brownfield option until it is no longer viable.

Until Vanchem and likely Highveld, are out of the equation, there cannot be a case for a greenfield processor. Even if it needs to be refitted, brownfield has, in my humble opinion, got to be cheaper and quicker than a full greenfield mine and processor. But all of that aside, the company is already telling us loud and clear that that is what we are getting.

(2 of 2)

But the killer punch is this (also on page 22) ;
“Bushveld Minerals intends to build its core processing capacity around brownfield processing infrastructure close in proximity to its primary vanadium resources. The attraction of brownfield processing facilities lies in the potential for significant reductions in capital expenditure and lead-time to achieve production.”
You don’t make a statement that strong and then go and spend $200m ona new processor in Mokopone, and then ask your shareholders to pay the tab.
The message is clear, the Mokopone mining right is the catalyst, then comes brownfield in some shape or form, I like Vanchem because it makes sense, but it doesn’t really matter, because it’s about the move, the strategy, and the value that brownfield processing will add. Just go ask Australian Vanadium how big a move that would be in this environment. They have a $360m capex for their project. Even in this environment, that is going to take some time to get, and they can’t really start until the BFS is complete. So 2022 is looking sporty. Ask TNG the same question. It’s been 3 years since their BFS and they still aren’t building anything.
Mokopone with brownfield could and should be in production by 2021 and at a fraction of the cost , and the vast majority of the what the company is saying is that is exactly what they are going to do, and it literally could land any day now.