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I would also like to say what a wonderful headache Lemur is to have. A project that could very easily go it alone on AIM and make its shareholders a lot of money. Just like the tin it would be listing at a time when much of the risk is already removed, which for an AIM listed junior is rare. BMN have delivered that not once but twice! It is only the fact that the Vanadium and energy storage platforms are so strong, that Lemur receives so little air time. That’s why I have been harping on about the BFS, because it’s the last piece in the pie before BMN pushes the button on whatever plan it has for the project. Go ask KIBO shareholders what they wouldn’t give for what Lemur has achieved in half the time they still haven’t.

@Daitom yes that could well be the case because I solemnly believe they are looking to offload the leadership of the project, if not the whole thing. If that were to happen, then I don’t believe it will be an out and out sale, more likely a majority sale in return for funding and building the project. I don’t see any cash being generated for shareholders, more a guaranteed free carry, which would add much value here. It a very good project in its own right and a say 20% free carry would add sizable NPV if the project is full funded to production. The dividend from BMN for me will be attached to actual cash generated from Vametco and as of next year the electrolyte plant, and will be a set percentage there of, rather than a one off from Lemur. Only my own thoughts based for once on feel rather than hard evidence.

@Daitom indeed but the indications are that it will be spun off like the tin. Power China will for me take a large stake in the project in return for building it. How this is to be done we will see but I don’t see BMN leading the project after that deal is done.

@Daitom I could not agree more. It’s bubbling up and setting up for a strong H2 here. One need only fast forward to Christmas and imagine what this company will have achieved, demonstrated and implemented. When BE is on the table, when the path to 10,000 mtv is known, when Lemur is monetised and spun off, when Vametco has demonstrated what a full year in this pricing environment is really worth. There is simply too much going on, too many game changing developments happening, for the SP to handle, so inevitably it won’t. Some big big days and weeks coming here this year.

Here is an interesting article demonstrating UK investment in South African renewable projects. A whopping 178MW of existing REIPPP projects to be exact. This shows a willingness to buy into the South African renewables story, which is a testament to the change of sentiment brought about by Ramaphosa. https://www.africa-energy.com/live-data/article/south-africa-globeleq-acquires-six-operating-renewable-plants

Which I might add will make them the biggest producer in the world.

@Daisan one other big giveaway for me is the reference to a capital allocation being defined in H2 2018, something FM gave far more direction on in his interview with BRR Media today. Again, the fact they are able to talk about this says very strongly to me they know what they are paying for the brownfield asset and what it will take to get it both into production and through any development cycles it may need. So the brownfield plan is for me fully known and it’s just about the communication. I also think more and more that Mokopone has no part to play in these 10,000 mtv and is part of the next expansion phase later down the line. For me Brits is the focus alongside Vametco because cause they hold far better quality ore and it does not need to move as far. Plus said quality ore will last many more life times than we need worry about. A clear plan and path to 10,000 mtv in this pricing environment. Wow.

Sorry ‘1000MWh’ of course

@Daisan appreciated fully and I respect your knowledge and clear expertise. For me on this occasion, the technicals and experiences may indicate previous paths but everything I have read and seen thus far from the combined sectors of Vanadium and VRFBs, coupled with what BMN is doing, tells me very strongly that it is going to happen. The latest interview from FM today only strengthens that view point further. I cannot lay out every reason here but the reasons are most definitely there and I see the success coming very clearly around the corner. When BMN state they are gearing up to deliver something, they are always always many months ahead with their thinking. What we are told about with regards the VRFB at Eskom, the electrolyte plant and BE as a whole, will I guarantee be minimum 6 months behind the reality on the ground. At every turn BMN is succeeding far greater than it demonstrates, at times much to our frustration. But nevertheless and most important it is happening. A very good example of this is the recent change in emphasis from 5,000 mtv to 10,000 mtv. As you will no doubt appreciate that isn’t some new idea, it’s a clear trigger point. A sign that they have achieved their hold of additional brownfield processing to the point they can begin to tell the market that they will move beyond 10,000 mtv. They may say they are looking at brownfield but that communication tells otherwise. BMN do not layout pipe dreams. They layout achievable targets driven by agreements that are already well developed. I very much have that feeling I had in late 2015 once more. A second brownfield is already agreed it’s now simply about the process being delivered to the market. At 10,000 mtv that second processor must be big, which Vanchem of course is. Vanchem also needs sizeable upgrading and repair, so the medium term delivery also sits very well with that point. Such indications and deliveries go a long way to demonstrate how BMN tick, which once understood, bring clarity to the BE story and the targets set there. BMN will build an electrolyte plant and they will I am sure hit that 100Wh target. How they will do it I don’t know but when they do, they will have created the biggest VRFB supply chain business outside of China and for me there will be no stopping them at that juncture.

@Daisan I do not wish to tread on anyone’s toes by entering what is a very interesting and knowledgeable debate. However, I would like to question how those technologies you were involved in compare to energy storage in terms of their potential market size and ability to impact how the world does things. That for me is key here because the pending energy storage boom is being driven by a global change in mindset. The world wants to be cleaner, it recognizes that it must be cleaner and thus the technologies that enable that are being encouraged. To what extent the answer in the end will be lithium or vanadium based has still to be clearly answered. I am greatly encouraged by the stance taken by China because in my opinion the rest of the world could fail in its support for VRFBs and it wouldn’t really matter, so long as the Chinese stick with it. I am also greatly encouraged by the position BMN is and has carved out in this fledgling market. Regulation may well still fail other participants in other lands but BMN is demonstrating a clear path forward with Eskom. There is a reason why BMN keep repeating this 1000MWh energy storage mandate target in their latest presentations and reports. They know something we clearly do not but can at the very least speculate on. FM himself has indicated that post initial results a path will be set upon to tie Eskom and likely a number of other interested parties to want of a better phrase, take off agreements. These indications, these snippets of insight, do not portray themselves as being small scale. So the path to very large multiple MW demand is perhaps much closer than we think. With the electrolyte plant planned for the East London SDZ with access to a port, the export of electrolyte also looks cemented in their strategy. Therefore, BMN has two very strong markets to tackle, China and South/Southern Africa, and is demonstrating early signs of leading the market outside of China, in terms of fully integrated supply of Vanadium, electrolyte and VRFBs. We must remember that BE has only being (officially) going 2.5 years, which is nothing. So whilst I cannot say that VRFBs will win the day, I can with greater confidence say that BMN is in as strong a position as anyone to achieve the market penetration needed, such that others can follow in their path. Nobody outside China in my view, has greater control of the process right now then BMN or can control their costs and their offfering better. So when the BE numbers and plans do finally come, they will highly likely demonstrate a model, which is far more complete and successful than we currently darecto imagine, and that has the very best chance of crossing that chasm, if it hasn’t already done so.

As is your entitlement PDub.

@Knuttie it was $61.50 but is of course not 100% precise given the company reported 4 week lag on prices is guidance only. As a point of note the Q2 production report will show an average price of approximately $65 per kg for the calendar year, which is what SP Angel will employ.

@Pdub there is more than enough clear evidence in just the first 4-5 posts of today, to demonstrate just how wonderful a story BMN is and is going to be. The supposed seller is but a tiny pimple on what is a very beautifully formed set of assets.

Thank you Brasi.

@Loudspeaker good morning. Yes and take a look at this enlightening tweet from Australian Vanadium showing the state of main Chinese inventories. If there was any doubts that the Chinese were up against it in terms of product, then such data certainly should blow such thoughts away. Just circa 200 tons of inventory between the 3 main producing provinces, compared to over 2,000 tons in early 2017. Bring on those new rebar regs

@Faramog I have constantly employed the ZAR 250 figure employed in the Admission Document for 2019. That’s because the same document described such operating costs as being the point when Vametco achieved 3,750 mtv. The current 2018 average Rand to US dollar exchange is circa 12.40. That gives an actual overall cost of $20,200 per mtv. I upped the cost slightly because the reality is the reported anticipated production cost of ZAR 205 for 2018 included H2, which will see far greater production. Therefore the H1 production will undoubtedly be higher, thus driving a higher overall operating cost. Thus my figure of $22,000. Knowing BMN, it may well be lower but for me it’s fair based on what we know at this juncture.

@YTSS that’s extremely difficult to say because between now and the end of September, there are any number of further catalysts that will go hand in hand with Vametco’s progress. One example is the Lemur BFS which is a defining moment in that project’s value proposition. Then there is the sleeping giant that is BE, which come come before or after. Throw in Mokopone and Brits, and who knows what the H1 results will be pushing things on from. Sorry but SP predictions in this news climate are extremely tough to determine.

I believe investors should be a little careful with their expectations for the H1 results. That’s not to say they won’t be very good, it’s more that they will be more of a spring point for what is still to come, rather than the all encompassing big hit. The Q2 production will be the first true indication of what we can expect because it will deliver the total sales for H1. Prices right now are flying and Q3 has had a quite wonderful start, but its important to remember that the H1 average price was circa $61.50 per kg. That’s still a very healthy number but given that it will be coupled with the lighter half of the year’s anticipated production, it will mean a very eye catching number but not a huge number. If Q2 delivers an uplift in production to say 800 mtv, so circa 10%, and they sold the lot (remember there is minimum 40 mtv kicking around from Q1), then we are talking 1,490 mtv sold. The anticipated production for 2018 is 3,680 mtv, so that would be a good 350 mtv less than half way. Of course they may have achieved more but it is less likely than likely in my view. I hope I am pleasantly surprised. At reported $22,000 costs, the EBITDA has the ability to come in at circa $59m, meaning BMN could declare EBITDA of $35m and therefore post tax profits of circa £16-£19m, depending on tax etc. All very good and very positive. But I caution that there will be in there somewhere other payments, such as the expansion Programme and EVRAZ, so they are likely to pull that figure back. None of that is to say that the result won’t be wonderful, the progress clear and the path to greater profits in H2 and beyond even clearer. I am just cautioning that whilst the production hikes and current prices seemingly identify a huge profit, they are more likely to truly benefit H2 than H1. At 1,490 mtv Vametco needs to do some 2,200 mtv in H2 at prices currently averaging as high as $78 and rising. That’s very big money indeed. I know I am ignoring the US prices and the premium and no doubt several other things as well, but until they are proven they should in my view be toned down. By being cautionary and realistic one avoids leaving oneself open to criticism by parties who will inevitably ask, why are we not seeing much bigger profits. The reality is those profits are coming and H1 will demonstrate that they are achievable by clearly showing what $61.50 FeV does for Vametco per ton, in a period of great expansion.

https://twitter.com/vanadiumworld/status/1019031980522917889?s=21 I agree wholeheartedly.

Bushveld tweet. FM to be live on CNBC Africa but no time or date stated, perhaps now.