Member Info for breaktwister

Any tips on high yielding miners? I have never invested for yield before but need to diversify a little now I am growing older and poorer after shocking PM miner performance the past 6/7 years

15% down in 3 days on "no news". FFS.

The news about Burritica is terrible for us, even if something is agreed with MMA that leaves us in a position to find other JV partners, the political situation in Colombia spilling over into cartel action on the ground does not make a good sales pitch.

Agree with barhut, too big a drop for a "no news" day. If it is bad news on permit then we are going much lower, maybe it is some other minor bad news has leaked?

Hall, we are all entitled to our own views. The previous investment case based on support of majors with free carry investment of $30m plus cash payments of over $3m is now gone. There are a range of outcomes possible here, worst case scenario is MMA try to play hardball and take 51% while refusing to meet the corresponding obligations to progress Phase 2 drilling. This could result in a protracted legal dispute with 2 of the biggest mining companies in the world while, if drawn out, OMI will need to raise cash to pay for the legal costs and stay afloat.

6000 shares bought, up 12% lol!

I wonder what OMIs proposal was, obviously it is for OMI to take control at Anza, but I hope we havent done something silly like offered MMA a significant free carry.

Karl, that would be the best case scenario. But why would MMA pay $2m just a few weeks ago only to walk away with nothing now? Was it poor decision making on their part, surely not? No, I think they will want their $2m back at least, or some other minor stake/free carry maybe?

What is our relationship with Newmont in a wider context? We have the contractual relationship for Anza, plus they seem to be interested in the Argentina project, plus they are our major shareholder with 15% if I am not mistaken. I have to admit I have no idea whether their shareholding plays a factor in how OMI deals with the current position at Anza. Worst case scenario they dump their shares? I do not know.

Here is what needs to happen now:

1) OMI need to write to MMA expressing their concern at recent comments made re: "care and maintenance". OMI need to state clearly that the contract has no such provision.

2) OMI should state that the 90 day timeline for entering into Phase 2 has long passed and that the current state of delay is unacceptable. Provide an additional 30 days for which MMA must enter into the new JV otherwise OMI will assume that MMA are terminating the Agreement. In this case OMI will retain 100% of the the Anza rights and will be free to seek new JV partners.

3) Alternatively, MMA can exit the Agreement immediately at no further cost or obligation. The contract allows for such an exit prior to the start of Phase 2. What is key here is that, if Phase 2 starts, work must progress, not sit in "care and maintenance".

Putting time limits upon MMA is critical here, in my view OMI leadership must do so to protect shareholder interests.

After taking some time to digest the most disappointing thing for me is the attitude and lack of timeline for action.

OMI has a strong contract here that does not permit MMA to take a 51% stake and then down tools. The 51% stake comes with obligation to progress the project and if MMA do not do so then the contract allows for OMI to progress the project, spend $20m and send the bill to MMA. It is all there in writing, there is no option for MMA to halt work or "place into care and maintenance", unless they wish to exit now which would be a clean break with OMI retaining 100%.

Payment of the $2m recently is likely to be a sore point. MMA must think that secures them a controlling stake and they can then down tools which is certainly not the case.

I see somebody dumped 350k at once today. I am not surprised tbh. Louis said "7-8 months" to complete the paperwork for Phase 2 new JV company rather than the 90 days as per the contract. Fine, but this process started on 9th Sep 2022 as per RNS at the time.

Re: Collective (or any other potential JV), Louis said they need to sort things with MMA first. What kind of deal Louis can make with MMA is critical. The agreement was never intended for MMA to down tools and have a free carry into Phase 2 and beyond which would make things very messy for any other JV partner to come into, and lets face it, it is clear OMI cannot finance an Anza scale drill program.

Brad said that if OMI are able to regain control they will likely bring Apta to JORC, rather than embark on wider drilling. I agree with this approach and wonder if the board has any cost estimate for such activity?

Thanks for the webinar Donald. I was disappointed that there was no timeline provided within which MMA need to make a decision, as an investor I do not want to be sitting here in 6 months time hearing the same thing which it seems is entirely possible.

re: 90 days between Phase 1 and 2. Fine for both parties to agree that a contractual timeframe no longer makes sense, or indeed is not possible due to changes in law or govt. But that does not mean it should become an unlimited time period!

This is somewhat tempered by Louis statements that the new JV company merger is ongoing. It was good to hear him speak in detail about the merger and transfer of licences and shareholdings.

The significant care and maintenance costs ($500-700k pa) give me some confidence that MMA will want to resolve this sooner rather than later.

However, I am worried as to how OMI will pay for project progression in Brad's preferred Option 3. This will require serious dilution or the complexity of introducing yet another JV partner into the mix.

Brad said in the last interview that there is no reason for MMA to want to delay. I have been thinking about this and have already posted extensively about one reason, which is the clock starts ticking with financial obligations attached.

Another reason, and this is conjecture, is that it strikes me as much easier from MMA perspective to offload the project while it is in limbo, an "unspecified timeframe between Phase 1 and 2" compared to trying to sell a stake in a crystalised new JV, because while in limbo any new party will be able to insert their own demands and put pressure on collapsing OMI to have the new JV work in their favour. Essentially, MMA are looking to sell their existing right to enter into a JV with 51% ownership, rather than crystalise that right and then look to sell their new JV stake with concrete T&Cs and financial obligations attached.

LW, I agree that Brad seems to just be willing to "wait on the majors to decide what they want to do". Ok, we have waited for 7 months, how much longer? Failure to draw a line at this point is complete and utter mis-management.

Furthermore, Brad seems to think that MMA have "a cast iron legal right to 51% of Anza". No, this is incorrect, they only have a right to enter into a JV, within 90days of Phase 1 earn-in notice, within which their 51% will be crystalised. This has not happened yet and we are well outside the 90 days. The statement "there is no time limit and this is a deficiency in the agreement" is incorrect. Why would our board say this unless they cannot read or simply following orders from MMA? Either scenario is very bad for OMI shareholders.

Unless management are willing to take action to protect shareholder interests I think all can predict what will happen here.

The stance of goodwill and taking time on JV paperwork was perhaps acceptable when the intention was to create the new JV company and start Phase 2 drilling. However, the revelation of MMA intentions of "care and maintenance" changes everything, and it is clear that Brad knew, or at least suspected this was coming, all while telling us the 7 month delay was for lawyers to set up the new JV company, which has not progressed at all it seems. My view is we use the lack of progression to our advantage and pressure them with a default notice; unless we have already done something stupid like given written assurance that they could take their time - surely not?

"willingly backed into a corner" yes, because there should have been a plan to deal with the possibility that MMA would seek to exit the JV or seek to delay entering into Phase 2 with its financial obligations. The contract places two criteria for this transition 1) 90 days 2) both parties to be reasonable. It seems clear that MMA are in breach and OMI need to grow a set and put a line in the sand.

With Agnico taking ownership of the project on the ground, the dynamics changed. MMA now have the perception that they are in control and it seems our board share this perception, incorrectly. OMI are still 100% owners of Anza and need to start acting like it to protect shareholder interests. What is needed at this time is for a clear line in the sand for MMA to make a decision, lets say 30 days, if they don't then we hold them in default, say goodbye with our 100% and look for new JV partners. The only trouble with this is that MMA will laywer up, unfortunate but I cannot see another way.

Obviously, if there is any type of relationship there at all Brad just needs to call the most senior amicable contact at Newmont and say "our share price has been decimated because of a lack of timeline, we need a way forward in the next few weeks or we will have to default you, work with me on this before things get formal/lawyers".

Jeb, MMA are not required to progress Anza, so your confidence in a "free carry" is very much displaced unfortunately.

Even if they enter Phase 2 they can choice to do next to nothing for 2 years before OMI can take action.

Year 1 they have carried forward $3.65m so only need to pay $350k to keep their option alive, year 2 they need to spend or pay OMI $4m, but if they do neither OMI are stuck for a full year before being able to hold them in breach of Phase 2 Y2 conditions.

And according to our board there is not even a timeframe for entering into Phase 2!

My questions are in, I did not copy the form so cannot paste here but I am sure you all know what my questions are, I want to hear some kind of a plan with timeline. It is entirely unacceptable that 7 months after Phase 1 has ended OMI are still permitting MMA to take their time with no end date in place. OMI own 100% of Anza at present, MMA have earned the right to enter into a new JV of which they will have 51%, fine, but we cannot permit them unlimited time to exercise this right or we will be bust.