Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
L-A Yes agree they would offset all the appropriate costs, but those costs would be a very small fraction of the £1.2 billion proceeds from the sale of Haverion on kieffy's numbers and ProfQ's calcs.
So assume for illustrative purposes £12m attributable costs, the tax amount on the net proceeds would be 29.97% of the gross amount. So to 1 decimal place rounds up to 30%.
For these back of fag packet calcs not significant.
And deduct 30% Aussie corporate tax.
So somewhere between 17.5p and 21p
Every year Newcrest issue a Mineral Resources and Ore Reserve Statement, the statement includes a table of the company's long term metal price assumptions.
Newcrest Annual Mineral Resources and Ore Reserves Statement - As at 31 December 2019 (Issued 13 Feb 20)
Page 3 Table 1. Long-term Metal Price Assumptions
Mineral Resource Estimates (MRE) . . . Ore Reserve Estimates
Gold – USD/oz $1300 . . . . . $1200
Copper – USD/lb $3.40 . . . . . $3.00
Silver – USD/oz $21.00 . . . . . $18.00
Molybdenum – USD/lb $10.00 . . . . . £8.00
https://www.newcrest.com/sites/default/files/2020-02/200213_Newcrest%20Resources%20and%20Reserves%20Statement.pdf
You can see the last five years of statements here:
https://www.newcrest.com/investor-centre/results-reports?report_type=7
It is worth noting that NCM, despite the fluctating metal prices, have consistently used the same long term metal price assumptions for the last five years. The main exception is that from 2015 to 2017 they used a MRE figure of $1350 gold and $3.60 copper for the NAMOSI JV.
Compare NCM long term assumption on gold price with the following actuals:
The average annual $ gold price 2015 to 2020 (YTD)
$1158 $1251 $1260 $1268 $1393 $1688
Annual highs:
$1298 $1372 $1351 $1360 $1542 $2061
https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart
Seven year rolling average: (calculated from data)
$1325 $1365 $1370 $1326 $1287 $1327
Actual realised gold price $/oz (from NCM annual accounts and half year for 2020)
$1236 $1166 $1263 $1308 $1269 $1446 (For Q to June $1646 !!)
https://www.newcrest.com/investor-centre/results-reports?media_type=results
So what is the implication for the long term metal price that will be used in the Haverion MRE?
On the half year and quarterly report the realised gold price this year may well be over $1500
Can NCM continue to use £1300 for mineral resource estimates when actuals are much higher? Will they issue an updated long term metal price assumption after the release of the annual accounts? Or will they create a higher value as they did for the Namosi JV? What will the long term gold price assumption be?
As much as I would like, I doubt it will be $2000!
CTC
Hopefully: "GH stating that if more funding was required it would turn to its supportive shareholders."
That was GH in June 2016, in the interview on 18 May this year he stated
In the London South East interview 18 May 2020 Gervaise Heddle CEO of Greatland Gold said:
“Hopefully we're at the point where its a decision to mine. And then we share the up front capital costs according to our share at that time and at that time we would have 30% they would have 70%.”
“Now they do have the right to buy 5% at fair market value at that time from us. If they do that will be a BIG amount of CASH that will come in at that time. Which will obviously, that may cover a lot of our costs in terms of the up front capital that we'll require. But whatever the case we'd be looking to debt finance any amounts that we need to do this”
“The key is to minimise equity dilution now and maximise value for shareholders. On a project like this I am sure that we could get some,well, I am optimistic that we could get debt financing for our share of any upfront capital costs”
We could assume that Newcrest have sight of data to conclude that they have sufficient evidence of a viable mining project . Enough evidence to commit the funding and recruit and employ staff.
The reward is far greater than the perceived risk.
Have to disagree, I don't believe the decision to mine has been confirmed by this job advert.
The advert clearly states, Twice, Exploration Decline.
" . . . to safely and efficiently deliver the Exploration Decline to meet the requirements of the Havieron business plan."
And:
"Managing the construction and execution of the greenfields Boxcut and Exploration Decline"
Also included: "Developing underground mining team" - Developing the team not the mine.
and: "Managing the surface infrastructure and mine development camp" - again not mining, the mining devlopment camp.
In my view of course
You may be right Madgoose, but like you anyone can come on here and say what they like (within the rules)
This is just idle musings after supper after that second glass of Chateauneuf.
So a decline down to the high grade zone and start taking truck sized samples .
Send the truck sized samples to Telfer and process the gold/copper and see how much it sells for.
Continue sampling until you have built the block caving infrastructure.
The joy in finding a $30k gold nugget
https://youtu.be/osj8d77_JI0
Sandeep Biswas = he would prefer to buy assets rather than whole companies.
The correct link:
https://www.reuters.com/article/us-mining-conference-newcrest/newcrest-ceo-says-happy-to-do-ma-if-right-value-for-shareholders-idUSKCN1QE2CN
Sandeep Biswas = he would prefer to buy assets rather than whole companies.
https://www.youtube.com/watch?v=EjNXwSeLuTU
And BR's GGPhelp
Definitely followed this for two years, and just referencing this thread after some of the most appalling threads over the weekend, so was a breath of fresh air.
I have to agree Lebugue that Paddygall wins the award for the most comprehensive and continuing feed of highly valuable insight. I would say without a doubt I have only stayed in this share because of the paddysat images giving a view of what is happening on the ground at Haverion far in advance of the Newcrests reports.
magictrades video presentations are also on another level beyond anything you could expect from a private investor'
And dont forget investmentjourney and all the other contributions from so many on this board.
Thank you All.
Risk of T/O GGP v buy out of Haverion.
Extract of comments made by Sandeep Biswas CEO Newcrest as reported by Reuters 25 Feb 2019:
HOLLYWOOD, Fla. (Reuters) - Newcrest Mining Ltd Chief Executive Sandeep Biswas said on Monday his company would pursue a potential acquisition only if it were the right value for investors, adding that he would prefer to buy assets rather than whole companies.
“We are happy to do M&A if it’s the right value for shareholders,” Biswas said at the BMO Global Metals & Mining Conference.
“The entire focus in not on the size of ounces (in a potential deal). It’s on rate of return for our shareholders.”
So I would infer therefore that he would prefer to buy Haverion rather than whole of GGP.
https://www.reuters.com/article/us-mining-conference-newcrest/newcrest-ceo-says-happy-to-do-ma-if-right-value-for-shareholders-idUSKCN1QE2CN
By far and away the most constructive and informative thread I have seen on this board in the two years I have been following here.
Thank you Rational Assessor and all the other contributors.
Goodnight all
Day high for 7 July $1,797.74 just $2.26 short
Don't count your chickens before they're Taxed!
Tom, I can go along with that thought process, but to be conservative I would deduct the potential Australian corporate income tax bill of 30%
So in the range 52p - 63p
Newcrest's tax bill for 2019 as reported in their financial statement after adjustments was $272m.
So on an accounting profit before tax of $830m works out at 32.77%
That article dates back to June 2019 and the dispute was resolved with MacMahon in November of 2019 with a new contract.
https://www.asx.com.au/asxpdf/20191104/pdf/44b7l85lnqnpv7.pdf