The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
What follows is a comparison of gold miner CEO pay as a cost (an expense) per ounce of gold. In other words the total CEO compensation divided by the total number of ounces produced in the year 2022 (where companies mine copper etc. the sales were converted to equivalent gold ounces) Drum roll please ....
Northern Star $ 0.39
Newmont $ 2.28
IAMGOLD $ 2.88
Kinross $ 2.97
Barrick $ 3.17
Centamin $ 4.16*
B2Gold $ 5.59
Endeavour $ 7.75
Alamos $ 7.95
Eldorado $ 8.06
Centerra $ 21.00*
You'll notice neither Centamin nor Centerra originally appears on the graphic link, they are included in the LinkedIn comments. https://www.linkedin.com/posts/jftduncan_ive-put-this-quick-chart-together-to-hopefully-activity-7077644511136428032-xQL2
Now before somebody dismisses the comparison as a simple 'you get what you pay for' or 'returns are based on profitable ounces not total production' - consider Northern Star Resources, the lowest CEO pay, generated shareholder return of 14% in 2022. Meanwhile Eldorado lost 9%.
I suppose Centamin's place in the middle is neither good or bad , except that CEO's paid both less and more outperformed Centamin across the board (ever since Mr Horgan arrived.)
Just what are the metrics by which Mr Horgan was to be compensated? Production growth? ROE? Reduced AISC? New ounces discovered?
So far he's been rewarded to enrich his friends at Capital Drilling, enrich his ESG buddies (solar project), appoint friends from his previous life onto the Centamin payroll (FTI Consulting), abandon West Africa deposits (Batie) and run-out-the-clock on the final hope of diversification (Doropo.) Yippee!
From Capital Sukari Gold Mine With Mr/Jamie Boton❤❤❤
https://www.linkedin.com/posts/radwan-ahmed-nasr-191106227_from-capital-sukari-gold-mine-with-mrjamie-activity-7081542775539646464-0xDm
Disclaimer : Personal Opinion
Judging from the selfie, Mr Boyton looks much happier than the average Centamin shareholder - perhaps it has something to do with his financial arrangement with Mr Horgan and co.
I am old enough to remember when being 'shackled to a corpse' was one of the pro-#Brexit arguments.
Now, seven years later, the UK's bond yields have just hit new record highs, so that UK has to pay significantly more for debt not only than Germany, but also Greece.
https://twitter.com/NvOndarza/status/1675867946151731202
reference point here (chart link below) UK 2Y vs Greek 2yrs… UK spread on Greek borrowing is also approaching 200bps - 194bps… similar levels it briefly got to at mini budget, but haven’t seen on sustained basis since early 2000s…in between it got to -3600 bps in UKs favour during Greek crisis
https://twitter.com/faisalislam/status/1675852351024898049
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of course, what's bad for borrowers is good for savers wanting higher yields on deposits
what do the UK people think ? (without relitigating the Brexit debate) do higher interest rates for savers outweigh higher cost of borrowing ? my take: net bad for businesses , ok for retirees
The secret behind generating value for mining shareholders is nicely summarized in this excerpt from the London Indaba earlier this week (where Barrick CEO & Centamin CEO rubbed shoulders)
"When M&A opportunities manifested themselves, they were grasped well beyond the operational assets into major additional asset building through brownfield operation around the assets acquired. The surrounding exploration potential was invariably assessed in cases where assets were acquired and measured against a proven discovery and development yardstick."
Questioned by Indaba chairperson Bernard Swanepoel on the number of people that make up Barrick’s exploration endeavours, as well as the company’s investment in exploration, Bristow responded that the New York- and Toronto-listed company employs about 400 exploration geologists and spends about $150-million a year on greenfield exploration.
“That excludes mineral resource management and reserve extensions of our current operations,”
https://www.miningweekly.com/article/junior-exploration-absolutely-critical-barricks-bristow-tells-london-indaba-2023-06-27
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Disclaimer: Personal Opinion To Follow
It seems to me Barrick has been using its assessment yardstick to gauge Sukari's potential for quite some time. The level of secrecy Mr Horgan has decided to employ when it comes to 'Top Secret' geophysical surveys, 'Top Secret' step-out drill results & 'Top Secret' already-known satellite deposit resources around Sukari leaves no doubt he's not working in the best interest of Centamin shareholders, rather 3rd party interests are in play.
You may be surprised to hear a critic like me say it , but Centamin's share price is far too low. The reason however, is not primarily a sagging gold price, h'ell it's still above $1900 - no, it's a lack of transparency and any sort of articulation to exploit what resources (and potential) that already exists.
35m ago
Endeavour Mining Plc made a takeover approach to rival Kinross Gold Corp. in recent months that was rebuffed by the Canadian company, according to people familiar with the matter.
Endeavour, an acquisitive gold miner backed by Egyptian billionaire Naguib Sawiris, was considering a potential cash and stock deal for Kinross, the people said. It held talks with potential partners about teaming up on a bid, according to the people, who asked not to be identified because the information is private.
Discussions between Endeavour and Kinross didn’t proceed beyond the initial stage due to differences over valuation and other issues, the people said. Kinross shares have gained 16 per cent in Toronto trading this year. Both companies have market capitalizations of about US$5.9 billion.
the company has also backed away from deals in the past if it couldn’t reach a friendly agreement — it abandoned an attempt to buy Centamin Plc, which owns the Sukari mine in Egypt, after the company rebuffed its advances.
https://www.bnnbloomberg.ca/kinross-gold-is-said-to-reject-takeover-approach-from-endeavour-1.1939801
Posted June 27
Allied Gold Corporation joins us at the Egypt Mining Forum as a bronze sponsor. Allied Gold Corp is a private equity and industry-backed specialist in transforming gold mining assets in Africa. With a focus on turnaround projects*, they have successfully operated three producing mines and have had two development projects in Africa for over a decade. Their operations span Cote-d'Ivoire, Mali, Ethiopia (under construction), and Egypt (early exploration)
https://www.linkedin.com/posts/egypt-mining-show_egyptminingforum-mineralwealth-miningindustry-activity-7079440537166000128-VzF7
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Background Information:
Note the line from above * "with a focus on turnaround projects"
Allied 'was' a private company but is going public soon and will have a multi billion dollar market cap. Additionally they've already raised $300 million cash in a bought deal to use in acquisitions/ development.
https://ca.finance.yahoo.com/news/allied-gold-corp-limited-allied-145100716.html#:~:text=As%20previously%20announced%2C%20Allied%2C%20AMC,combination%20and%20Going%20Public%20Event.
Coincidently, Allied's Chief Geology & Strategic Officer Greg Winch was at one time the exploration manager at Sukari - and was gifted a generous package of shares for his troubles. Funny how these things come full circle...
Series 30: 400,000 shares were issued to Greg Winch under the ELFSP on 21 June 2011. The share based payment arrangement was exercisable on 30 Sept 2014
https://www.annualreports.com/HostedData/AnnualReportArchive/C/LSE_CEY_2011.pdf
https://www.linkedin.com/in/greg-winch-885b013b/
Posted 1hr ago
It's been a pleasure to meet you in person James Siddorn. We had lots of insightful discussions 💡 that really helped me see things from a different and more wide perspective 🧭. I'm looking forward to next time we meet 🤝🏼. My best wishes for you Mr. James🍀
https://www.linkedin.com/posts/mohammed-el-shinawy-3bb73810a_its-been-a-pleasure-to-meet-you-in-person-activity-7079814094735704064-xOEk
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James is just the latest specialist brought on site to 'teach' the locals how to interpret the Sukari deposit (it was Bret last month). James creds:
I am a specialist in the structural analysis of ore deposits, focused on deciphering the deposit-scale controls on ore plunge, geotechnical domains, seismicity, and hydrogeological pathways. I am also an expert in the applied geological interpretation of aeromagnetic data, and have extensive underground and surface mapping experience, and a broad mining experience in conventional and mechanised underground mining.
I have spent 20 years in the structural analysis and 3D geological modeling of gold...
https://www.linkedin.com/in/james-siddorn-11174614/
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I do hope these international pros help decipher Sukari's potential , cuz...
https://www.youtube.com/watch?v=zTcu7MCtuTs
The short answer is that I would very much like to be invested, again.
I think an investor ought to do his/her homework before, during (and after in my case) so as to not be caught unaware.
I'll ask you, what is the alternative - take the management's word for it? That hasn't been a reliable or forthcoming source - so I seek alternatives. Do I think Centamin is investable ? Not at the moment - too many unknowns. Can it be investable again? Sure - but as I regularly point out - the current management takes extreme liberties when sharing info. (some of it blatantly misleading)
The best outcome I see is a takeover by a reputable team - perhaps B2gold - then I'd have the confidence in disclosure - and the diversity we as Centamin shareholders were promised many many moons ago.
I hope that answers your question satisfactorily? Centamin is but one of many companies I track and have invested in over the decades. Posting on here really doesn't take much time - it's a tiny fraction of what I do daily. Best, D
Please do send me an email (what we're doing here is called a 'chat' post)
I have no problem letting you know who I am : https://www.linkedin.com/in/don-lawson-98619370/
please do the same and share your linkedin account for all on this chat forum to see , maybe we can be reconciled ? want to friend me ? Jesus did.
Please post exactly when I countered your posts on inflation
and when I said anything derogatory to you
you won't find it
thus, get back on your meds
ps
if it's being a horrible person to warn others not to listen to Centamin's mistruths and post actual research on the company instead of fluff - then I choose horrible every day of the week for the rest of my horrible existence
Costs from the PEA released last year:
total to build US$275 million ; AISC of US$ 904/oz at a gold price of US$1,450/oz for an after tax a NPV of US$234 million and IRR of 21%
et voila, costs from today:
total to build US$349 million ; AISC of US$1,017/oz at a gold price of US$1,600/oz for a BEFORE tax NPV of US$330 million IRR of 26%
Shareholders - can you spot the changes? Good for you!
https://www.centamin.com/media/2439/doropo-project-pea-report-2021_01_updates_190921.pdf
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Other cr*p:
The metallurgical bla bla actually stayed the same although worded to sound better, the electricity should come from the grid and costs less than diesel (astounding!) and to quote today's PFS;
"Under the current Ivorian mining code, mining permits are subject to a 10% government free-carry ownership interest. However, for the purpose of the PFS project evaluation and disclosures included within this document, the cash flow model is reflected on a 100% project basis"
Now that is hilarious. What, when reality isn't pretty enough resort to fallacy? These goons are the real deal.
and finally, another gem from today's PFS announcement, and I quote:
"Construction cost-saving opportunities by increasing in-house project execution versus the use of engineering, procurement and construction management contractors"
Now there is the first truly honest thing Centamin management has said in a long while - it actually costs way less to do it in-house than hire a contractor?!
Too bad our good Centamin Lords didn't realize this BEFORE they signed away hundreds of millions to the Capital Drilling waste contract at Sukari.
So glad I sold this sh*t show when I did. Have fun waiting for Doropo LTHs
Quarterly average all-in Sustaining Cost (AISC) for #gold mining rose to US$1,358/oz (+6% m/m, +10% y/y). This a new high
https://www.gold.org/goldhub/gold-focus/2023/06/evolving-picture-global-gold-production
https://twitter.com/KrishanGopaul/status/1672174973283074048
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Thoughts:
When will inflation abate? How will miners pay for exploration? Are dividends safe?
Along with these heavy hitters:
https://www.londonindaba.com/other-indabas/the-london-indaba-2023
2023 Speakers
Robert Friedland - Founder & Executive Director & Co-Chairman, Ivanhoe Mines
Neal Froneman - CEO, Sibanye-Stillwater
Martin Horgan - CEO, Centamin
Tom Attenborough - Head of IBD, London Stock Exchange
Mark Bristow - CEO, Barrick Gold Corporation
Matthew Chamberlain CEO, London Metal Exchange
George Cheveley - Portfolio Manager, Ninety One
Martino De Ciccio Deputy CFO & Head of Investor Relations, Endeavour Mining
Martin Horgan, CEO, Centamin, will discuss his company and the Nubian Shield at the inaugural #londonindaba, 26-27 June #joburgindaba http://londonindaba.com
https://twitter.com/joburgindaba/status/1672938014077591554
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Thoughts:
- Ninety One has been meeting oft with Mr Horgan lately ( top 7 shareholder )
- Barrick has been rebuffed several times already this year by mids & majors alike not keen on a zero premium merger, but at Centamin's current share price, even a 25% premium would look good on paper to both parties , and maybe even some LTHs tired of the battle
That would be B2Gold and Barrick - one has since abandoned all talk of Egypt exploration
B2Gold's AGM report is 91 pages - not a word about Egypt...
Jun 12, 2023
https://www.b2gold.com/_resources/FINAL%20Circular.pdf
but B2Gold has decided to diversify into Canada (for the first time) and will spend $675 million US to build a mine. That's on top of the $1.2 billion they spent last year to acquire the Canadian deposit from Sabina.
NB
When B2 originally won the concession in Egypt I was excited to have a secondary way to invest in Egypt's gold scene. Today, I have no confidence in the EMRA's ability to attract new investment. On the contrary, 2 and half years have passed and the EMRA refuses to finalize exploitation terms. It's like the EMRA wants foreign investment to fail.
Mining deal-making declines, but Beaty and others see opportunities
June 23, 2023 | 10:40 am
They say share prices are reasonable or low for their assets while commodity prices have been high
Companies on his radar include Endeavour Mining in Côte d’Ivoire, Burkina Faso and Senegal; Omai Gold in Guyana and Centamin in Egypt.
“Centamin, they were ballsy enough to go into that country and now I see that Barrick Gold is going in,” he said. “That’s what I’m looking at, companies with potential that can grow, then they will be a tidbit for some of the intermediates or the majors.”
article continues here:
https://www.mining.com/mining-deal-making-declines-but-beaty-and-others-see-opportunities/
Bottom Line: the gold deposits not already held by the majors are on sale
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Given the above, it's reasonable to defend one's rationale for holding Centamin. It's even reasonable to get annoyed at those posting negativity on a forum dedicated to investing in a company.
However, nobody who posts only good, positive vibes here is going to compensate you as a Centamin investor if you continue to hold while the share price drops further & further.
Therefore, why not consider all aspects of a company and not just the positive? That is unless the pro-invest crowd is willing to compensate those they've lulled into a state of security when it turns out Centamin might just as easily:
1) lower or cease dividends
2) have less than anticipated growth (the Doropo project is anything but a sure bet)
3) lose money if gold drops to nearer AISC levels
With mainly Berenberg employees
https://www.linkedin.com/posts/berenberg-conference-and-events-952398215_yesterday-we-hosted-the-annual-berenberg-activity-7077918193209499648-NMnK?
posted 9h ago
Yesterday, we hosted the annual Berenberg Thematic Mining Afternoon and Summer Drinks Reception at the Marylebone Hotel. The afternoon consisted of two panels; 'The Energy Transition Theme: Assessing Where We Are in The Journey' and 'Funding The Next Generation Of Mines To Drive The Energy Transition', followed by a drinks reception in the courtyard.
Thank you to our excellent panelists and to everyone who joined the event.
First panel: Paul Gait (Anglo American), James Whiteside (Wood Mackenzie), James Rutherford (Centamin PLC)
Second panel: Marc Bishop Lafleche (Ecora Resources PLC), George Cheveley (Ninety One), Menno Sanderse (Rio Tinto)
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but also reps from Centamin's 7th largest shareholder Ninety One
https://ninetyone.com/en/united-kingdom