Thought for today ?1 Sep 2019 09:40
My old man said to me as a young lad You have to take the opportunity of a lifetime son in the lifetime of the opportunity ... wise words Frankie lad haha
I think that time may be fast approaching here cos I reckon in their ideal world the board would understandably want to take Araguaia to production if they could ,unless an unbelievable offer came in ,as this situation here and now must be stuff of dreams surely
They’ve got Nickel flying , they know supply deficits are highly likely in future years giving serious upward momentum on pricing , demand is multiplying by the day , and after this weeks news it would be a brave person (even nickel investor) to bet against finance being acquired to take it into production ...so it’s looking good on either count imho
As for Vermelho for 8 million quid it’s bargain of the century -given Vale spent 200 million on it as well ,so what are the options here ?
well for starters it could go either J/V or again maybe an outright sale and as such in either case I reckon that would bring in a huge amount .
I did read somewhere that a fag packet valuation for Vermelho came out around £350m let’s say which sounded about right to me & seemingly ,the optimum time if such a deal was to happen would be a month or two after releasing the PFS which of course is due this month
The current Mkt cap is circa £60-70million (and if it hits 100 million then that figure opens itself up to a much bigger investment community on its own) but if any deal on vermelho was struck then at those figures the value multiplies simultaneously .
Point being the variations are plentiful and Araguaia at current nickel prices don’t forget, will be throwing out billions in free cash flow once it gets rolling ..so even now at 5p a share ..this still represents unbelievable value when u consider there is an in ground nickel value of 60 -70 billion and that doesn’t even include the cobalt resource ffs
As such I reckon this must be fairly close to meeting the criteria for Mr Buffett’s iconic phrase “ when it’s raining gold get ur bucket out, not ur thimble “ ... time will tell as always but exciting times GLA
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