Member Info for Canary3

My take on the SP fluctuations going forward, rest on the three main theories being put around as to why it is happening.

1. It's only Pi’s trading the news / whims and that causes the movements.
2. The shorter are forcing down the price whenever it rises.
3. That II’s are accumulating ( my favourite as i have posted before ).

It's probably a bit of all three, and i think the accumulating is beginning to show itself a bit more. In Feb Blackrock declared that they increased from 60 to 100 million.

At that point morningstar said that funds and II;s hold about 1 billion shares. That might be correct or not.

If they hold 1 billion plus i would say that between Starvest and Pi’s with big holdings we can account on another 4 or 500 million that won't sell. ( that could be a low figure or a high figure its just a number to help my view along)

That gives 1.5 Billion not available so 2.5 available for trading / shorting.

II’s increased by 40 million last month, if they do something similar for the next 6 months as we move through to the FS then that will come to about 250 million shares to buy. ( thats a big if of course)

Thats about 10% of shares available, according to my numbers.

Getting 10% in 6 months will not be an easy task, particularly if the SP stabilises and starts to rise a little ( IMO this is already starting we have been in the 12’s briefly 5 times since December and we seem to be trending up a little since December),

So IMO if the SP stabilises then Pi’s are less likely to sell, so the job at hand will be to destabilise the SP

Destabilising the SP allows the II’s to get that 250 million they need from PI’s that want to get out and of course those sales will need to outweigh PI’s buying, so IMO for that to happen there needs to be spikes of 10, 20 or 30% , that then retrace ( like last week) that will encourage Pi’s to sell on the up and on the way back down.

I expect and hope that the following happens over the next 6 months.

1. II’s and funds continue to accumulate.
2. We see spikes that go up fast and come down fast , but each time the lower number get little higher.
3. Pi’s slow their selling

and to help it all along we get a steady stream of encouraging news.

If the numbers change IE there are more that 500 millions shares held by Starvest and PI;s that don't sell then the accumulating gets more difficult and Vice versa of course.

I have a fully operational Tin Foil hat , so I am completely safe if this happens or indeed it doesn’t.

Bottom line for me is that the SP will rise into the FS and we will see quite a lot of Spikes and retraces.

The only thing that will prevent this is major news.

All IMO

Regardless of whether we are sold soon or go mining, i mamvery pleased that SD was awarded 12 million shares.

If GGP is to be sold then very penny on the price will make a difference to him personally.

And they were awarded before NCM threw him under the bus, so no bad press available.

He has made his name in OZ mining by going rogue, now he can make some money as well...

I think that the MRE was delayed to inhibit GGp’s ability to access finance, that of course would put NCM in the driving seat.

i am hoping that in taking the bold step of releasing their own MRE GGP have done so in the knowledge that finance will now be forthcoming. ( Really it had better be forthcoming). Lenigas commented on another board , that he had never known a Junior partner in aJV take such an action against one of the big boys. So IMO it is a high risk strategy.

The MRE does put a value into the public domain and since it is independently verified by a known and respected entity, it puts a stake in the ground.

We know that if an offer comes into GGP for all or part of their holding , NCM have the right to first refusal on that offer. Is there someone in the wings waiting with an offer for all or part of GGP’s holding?

NCM might be seen as a bit misguided chasing new opportunities in North America when they own 70% of this major new find and haven’t made a strong partnership with the owner of the other 30%.

There will be some interesting discussion going on thats for sure, now that we now know rather than just suspecting that II’s are building their positions, it would seem that all parties are in play.

Again all IMO

I have been a believer for a long time that shares are being accumulated as the SP moves around 13 to 16p , despite being informed by other posters that a lack of Tr1 mean that i am a naive and foolish PI.

it seems that Blackrock have increased there holding by 41 million to 100 million recently, Morningstar information

The accumulation continues IMO

Page 24 of the briefing book released at the feb released has hav at 26% IRR using 1750..

Apologies, the 5% is indeed crucial..

NCM have public stated a number of times, that they will pay the next phase of mining costs for Hav from cashflow from Hav, they said that more than 12 months ago when SB was asked about capital required by an analyst.

So both parties are counting on that cash coming in, NCM might fudge but until then the is position is that the starter mine will fund the rest.

I was about to post about SD talking about, going back to first principals and fully understanding the ore body, or words to that affect.

I have been in enough meetings in my life that when the top person say that or something like that, generally it means

- We are not achieving what we want to achieve so let's go back and make sure we have been doing the right things. More colloquially , we are in the doo doo and we need to get out of it.

IMO SD is going to try to get GGP into a position where every claim made by NCM can be countered if it is not factual, or at least disputed with a rational argument.

The difficulty he faces is time and resources, but i am sure he will give it a good shot.

And IMO at some point, either NCM or GGP or both will get approached by a bigger entity and they will take the prize., if they can’t resolve this difference and become good partners again.

A takeover is much easier if you have ii’s to deal with, get 30% to agree and you make a bid, 50% and it goes unconditional, 90% to squeeze out remaining holders who don't want to sell.

If it is a scheme of arrangement you need 75% to agree.

It is much more difficult to do this with a company that’s a very high Pi holding.

In GGP’s case getting 50% to agree will be difficult IMO.

This is one of the reasons that I have thought for along time that accumulation is going on..

Timewill tell

It can be valued above that if there are circumstances to justify it, but on my limited undressing of the code equally they can put a zero or nominal value on it.

The Jorc code puts it as,’

The part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity.’

and as such has a low value in negotiations, my words there

Sorry, that was speculation on my part, we just have the 6 months delay at the moment, having lost trust i can easily see that stretch out. .

A few weeks ago , i did a post about trust in business and that good partners don't throw you under a bus. Well IMO NCM have just shown they are not a good partner.

Arbitration without an MRE upgrade means the Valim code is used to determine which valuation is chosen, the code can be applied to put zero value on inferred ounces. It's not going to be favourable to GGP thats for sure.

Another years delay on getting the ore and cashflow could be very detrimental for GGP.

At this stage of the JV for NCM to do this IMO is not negotiation its blackmail. They are going against their stated corporate values of building great relationships with partners and suppliers.

Our board needs to be looking at other avenues as well as trying to continue to get NCM to release the MRE upgrade.

Not great, i was one that thought NCM would play with a straight bat, unfortunately i am wrong.

A couple of months ago NCM said they were moving to spot pricing agents their projects.

We saw the result last night, IIR went from 16% to 21 % on HAV, that is almost a 33% increase in how they calculate the future profitability of HAV

If they were playing games they wouldn’t have done that..they basically said the HAV was underpriced on their books by that 33%

Decline is disappointing of course but a 33% lift when negotiations on price are ongoing is a major sign of a good senior partner IMO.

A good IIR for investment purposes is around 20% , as Zoros pointed out last night Institutions will like this.

I think BHP should just retract their half year dividend and buy GGp... some cash machine at the moment.

That company has some firepower

The Eu has just changed ts taxonomy of power regarding climate change such that gas is now green, as long as the new power station replaces an old one, Nuclear has now been included as well as a green source of energy.

This was done at the request of France , they have just announced a major upgrade to their power supply that includes 7 new nuclear power stations as well as new gas power stations.

One rule for France the rest nowhere!!

BTW Germany gets over 20% of its energy from coal, specifically Lignite filthy stuff, they just and had a new power station burning this rubbish come on line, that power station was commissioned after the greens forced the closure of their nuclear capability because t he Japanese disaster.

Why we don't hist do our own thing is beyond me..

That article is from 2010, around that time and a bit later cases actually did got o court, unfortunately very dodgy CEO’s used the threat of this type of action to shut up posters with legitimate concerns and to hide their corrupt actions.

It all fizzled out.

When holders want to sell more than other investors want to buy , the price goes down.

When Investors want to buy more than holders want to sell the price goes up.

Shorters only impact the price temporarily

price insensitive buyers drive up the price temporarily.

Ultimately value will out, one way or the other , IE up or down.

https://www.australianmining.com.au/news/newcrest-credits-cadia-performance-to-block-cave-mining/

Forgot the link

And yes most Aussie investors think it’s too deep. They are focused on historically shallow deposits and don’t seem to get that NCM don’t care about depth…. They care about 50 years of large scale production

I find this odd, NCM have stated that they are the best in the world for Block caving gold S Biswas said that in a recent interview. In Oct 2020 this article appeared in Australian mining.

I would imagine all investors intended in mining would be aware of this in some form or another and the specialist investment houses will be all over it.

?

Great stuff as usual Dip, the thing that strikes me is that GGP is growing fast and will need to continue to grow as the 25% of grows, we are not taking a royalty on Hav, we are partners, albeit junior, and own and must contribute in proportion to that 25%.

Of course NCM are utilising Telfer and its infrastructure and people initially , but as the years go by and people retire, technology moves on and investment decisions need to be made , we need to be part of the discussions on how these things develop and are implemented, and so we need great people to help make these decisions.

Sd seems to me to becoming more calm and thoughtful, as well as being optimistic and excited.

Thnaks again for the notes.