The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Doropo PEA 2022 2nd version : Build $275 million; AISC $ 904 ; gold $1,450 ; AFTER tax NPV $234M ; IRR of 21%
Doropo PFS 2023 : Build $349 million ; AISC $1,017 ; gold $1,600 ; BEFORE tax NPV $330M ;IRR of 26%
Important Differences Between 2022 PEA & 2023 PFS are these added caveats:
1*) "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"
2**) "Centamin will continue to review their tax position regarding corporate income tax, withholding taxes and VAT to ensure that the DFS accurately reflects the most suitable and relevant taxation for the asset."
3***) "The evaluation method considers the Project has been evaluated on a 100% ownership basis, with no debt financing."
* 'free carried interest' means the interest derived from holding shares of which the holder enjoys all the rights of a shareholder but has no obligation to subscribe or contribute equity capital for the shares; i.e a 10% share in the net profits
** Cote D'Ivoire royalty rate on gold sales: 3-5% (sliding scale based on gold price) & corporate tax rate: 25%
*** any means of financing (debt, streaming, etc) will further reduce IRR
Conclusion:
a) Doropo will be more costly to build than estimates made in 2022 & 2023
b) why Centamin chose to fabricate a higher IRR of 26% in the 2023 PFS by raising the sell price of gold, deleting taxes & royalties, ignoring the Ivory Coast's 10% free carry interest and the biggest faux pas - the cost of debt financing or other (like royalty or streaming financing) is IMO cynical & deceptive marketing (not an idiot thing to do on the part of CEO Horgan, just plain evil to shareholders and the Market)
somebody persuade me I'm wrong in this assessment , preferably backed up with facts & figures
Such as laughable and idiot - those are not directed at an individual - just the ideas we all formulate about a company, situation or predicament
in fact I often call myself an idiot for a multitude of frivolous reasons , it's just a habit like swearing - apologies for any offence
my next post is a doozy , so nobody get the nails & cross , please
Filled post after hate filled post on LinkedIn these days.
If I was their boss they wouldn't have spare time to post this during work hours. But sadly , this included Centamin group managers and every level of employment at Sukari.
Ahmad Mohammad likes this
Muhammad Ahmed Eid, ISEE®, PMP®
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Connect with Muhammad Ahmed Eid, ISEE®, PMP®
America must immediately stop meddling in and corrupting peace among nations and international communities.
Everyone knows that Israel is not a state; Israel is a corruption hotspot, planted by America to corrupt, destroy, and steal the resources of the Middle East.
continues...
You posted 'seems to me Cowichan is not on our side'
yet , who else on the LSE chat board highlights the data Centamin's management would rather bury in the pages or obfuscate behind a misleading headline ?
if you figure somebody who wants to prevent you and other LTHs from being deceived and ultimately losing money isn't on your side, you have no business purchasing shares in any company - ever
The only job you seem to have MrBond is covering up for Centamin's mismanagement - whom you continually worship for giving shareholders dwindling dividends, a flailing share price & ever rising costs - if that is your definition of a normal shareholder then you are anything but
I'll give you that nobody at Sukari has been seriously injured or died lately - but the rest is utter rubbish
the elevated waste clearing is not scheduled to finish until the end of mine winddown period - as per Centamin's brand new LOM schedule found here : https://www.centamin.com/media/2996/sukari-life-of-mine-summary-oct-23.pdf
year 2024 waste to ore ratio 6.4 to 1
year 2025 waste to ore ratio 10.0 to 1
year 2026 waste to ore ratio 11.4 to 1
year 2027 waste to ore ratio 10.0 to 1
year 2028 waste to ore ratio 11.1 to 1
year 2029 waste to ore ratio 7.5 to 1
year 2030 waste to ore ratio 5.8 to 1
and forget about less ounces being very good for shareholders - less ounces means higher AISC because the ounces produced is the denominator in that equation ($600,000,000 / 500,000 ounces = $1,200 AISC vs $600,000,000 / 400,000 ounces = $1500 AISC)
how about experts like Bond stop spewing the same old misinformation to lull shareholders into a comatose state of delusion , without numbers and facts all you have is pie-in-the-sky platitudes that all is well
It's been 12 quarters since Centamin last cleared 130k oz
Centamin's own estimates at the start of 2023 was not for 130k ounces in Q4
so why would shareholders expect that to be reached? unless there is a standby source of higher-than-normal grade ore waiting to be processed -
Centamin's processing plant runs at capacity 24-7 (not including during breakdowns or maintenance) so there is no means to push more ore thru the system - the only other way to increase ounces is via higher grade - if Centamin has higher grade ore just waiting for such disruptions, great - tell shareholders the same - if not - tell shareholders the shortfall is unlikely to be met
Just like in Venezuela & Lebanon. First your money becomes worthless, then its use becomes restricted, and lastly its not yours anymore, its the banks… Goodluck Egyptians 🥳
https://www.instagram.com/p/Cyih932IK8L/
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Ahram Online , Tuesday 17 Oct 2023
The Central Bank of Egypt (CBE) issued new instructions on Tuesday to regulate the use of credit cards for transactions in foreign currencies abroad amid concerns of misuse.
The decision was taken as the CBE has noticed recently “misuse of credit cards by withdrawing cash from abroad despite not travelling,” the central bank said in a statement on Tuesday.
Banks have already started to inform customers of the limit of their domestic transactions.
State-owned National Bank of Egypt (NBE) limited domestic transactions to the equivalent of $250 per month.
https://english.ahram.org.eg/NewsContent/3/12/510436/Business/Economy/Egypt-sets-new-rules-on-use-of-credit-cards-abroad.aspx
RE: Accountability At Centamin & Share Price Performance
25 Feb 2022 00:13
Some good points Cowichan. When the pit wall fails they obviously have to change their mine plan immediately (all hands on deck, think panic), and depending on whether what "fell in", is ore or waste or of intermediatry value, it can have different effects on AISC, head grade etc. Lets just say things are muddied and mixed somewhat. They would announce the new plan, which is what they did in their presentations including the Jan 2022 presentation. Investors should look at the ounces produced prediction, and predictions on strip ratio, AISC's etc. This is what dicates the margins, profitability etc. .. as well as the price of gold (!!, anyone got it right so far?)...
I like the figures they present, and this is what they will be held to account on. Slide 24 on the Jan presentation is one to look at. This year they are predicting higher AISC, and thank goodness for the global instability (sad comment), the gold price could exceed the cost increases, and the margins could be healthier than predicted. After, 2023 on, gut feel is CEY will be a cash cow again.
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the January 2022 presentation goldgnome refers to can be viewed here
https://www.centamin.com/media/2477/centamin-investor-presentation-jan2022.pdf
page 24 indeed forecasts AISC coming in at $900-1175 in 2024
whereas the newest LOM plan shows AISC coming in at $1,140 - 1,220 in 2024
Now, the question is - how can CEO Horgan advise the market that in 2025 AISC will reduce to $1042 when the same 'just revised' LOM chart shows the strip ratio spiking up to 10 to 1 in 2025 (verses 6.4 to 1) in 2024 ?
These two facts are not compatible. Wouldn't you agree, goldgnome?
So you literally went from if the strip ratio doesn't come down Horgan should lose his job
to
everything is great now, trust me, i know what i'm talking about
that's laughable
what will your view be next week, i wonder
These are YOUR words posted earlier this year:
RE: Regarding Strip Ratio & 2023+ Ore Grades11 Mar 2023 09:10
Cowichan Interesting comment regarding strip ratio suggest you remove the waste removal impact in 22,23 and 24 and the strip ratio definitely reduces. So if average is 8:1 then as I say remove the first 3 years and logic says strip ratio will (should or GOT TO if Horgan wants to stay in a job) reduce.
Excellent news also is the higher grades years 25 through 29 in the open pit (hopefully justifying the waste contract).
Grades lower than 22 for 23 and 24 but increased ore both above and below ground hence forecast of marginal improvement in ounces.
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you can't have it both ways , either you were wrong before , or you are wrong now - saying both are true is a diservice to others LSE posters and shareholders who believed things were headed in the right direction post Capital Drilling contract
I seem to recall you and others quite positively assuring others the strip ratio would be reduced significantly due to the costly but quite prudent Capital Drilling contract wrapping up - indeed stating the strip ratio would return near the historic average once complete -
but now - when presented with quite the opposite - it's "just how older mines" operate"
wow, there really is no wrong CEO Horgan and team can do - it's always a 'buy' rating
clearly - these elevated figures which rise year over year is new information to shareholders as nobody, not LSE posters, Centamin management or analysts have drawn attention to it
to state one thing about reducing strip ratios in the past , then pretend one didn't , is the realm of executives with stock options , not simple shareholders like 'us' - but maybe we're not in the same boat after all
The 'not actually lower' LOM waste to ore ratio of 6.4 to 1 CEO Horgan touted on the video presentation last week isn't the end of the bad news - look under the hood at the 'year by year' chart and you'll see the ratio actually rises substantially for each of the next 5-6 years!
the chart is found here : https://www.centamin.com/media/2996/sukari-life-of-mine-summary-oct-23.pdf
2024 6.4
2025 10.0
2026 11.4
2027 10.0
2028 11.1
2029 7.5
2030 5.8
Neither the analysts nor management discussed this upward trend. No wonder the AISC isn't scheduled to get below $1000 until 2029 - the waste stripping ratio is elevated until the next decade!
Siko,
it's impossible to defend Egypt's position , so the only option is to end debate - that is fine, just don't expect democratic minded people to gladly support Sisi's decision to prevent Palestinians from leaving - there is no 'seeing' Sisi's point of view - Sisi is a ruthless dictator that cares even less about the Palestinians than he does Egyptians - the tens of thousands of political prisoners his regime has arrested, jailed & tortured over the last >10 years is but just a little proof
That is the most stupid & heartless justification an idiot could think of
so here's the scenario:
I am a Palestinian waiting at the Rafah border - it's because I want to leave - which should be my right
nobody, not Sisi nor Israel nor Americans can tell me I'm not allowed to leave - I want to live , and if that means I live someplace other than Gaza under Hamas dictatorship so be it
now to claim Egyptians are united in preventing Palestinians who want to leave from leaving is either a) an indication a whole nation is heartless or b) an indication Egyptians would rather Palestinians die than give what they perceive to be a 'win' to Israel
either option is a disgrace to any nation - but hey, if Siko says it's true who am I to disagree
additionally , I don't buy the crocodile tears anybody would express at the plight of Palestine while they hold the view Palestinians shouldn't be allowed to flee into Egypt and beyond -
I doubt Islam condones allowing innocent people to die for the sake of one's hatred of the Jews - but hey, maybe it does
I think all who post on this forum agree with you regarding the atrocities in Israel & Palestine
Many factors will push the price of gold around, Ukraine has endured 600 days of Russia's onslaught with hundreds of thousands dead collectively and tens of millions forcibly displaced - one could argue that gold should have been affected more so by that much larger conflict
Some theorize that it's US longer term interest rates spiking that is currently spiking gold - counterintuitive as that may be considering gold has no yield (if held at home in a piggy bank)
I do hope Egypt's Sisi (and those demons Hamas )will allow the Palestinians to flee through the Rafah Egypt border - why Egypt a fellow Arab nation would prefer to see Palestinians whom they count as 'brothers' go hungry and possibly get bombed is beyond comprehension - if Israel really is an apartheid state then by the same token so must be Egypt
Egypt’s bread subsidies are unsustainable
But with inflation soaring people can afford few alternatives
Nearly two-thirds of Egypt’s 106m-strong population rely on subsidised bread. Partly as a result, they devour about three times the global average per head.
Bread subsidies are already expensive. They cost $2.9bn in the past fiscal year, 2.6% of the budget. Only half of the grain Egypt uses is grown domestically;
https://www.economist.com/middle-east-and-africa/2023/10/05/egypts-bread-subsidies-are-unsustainable
------------------------>>>>
Egypt's latest inflation figures were yet another record at 38% for September
https://www.reuters.com/world/africa/egypts-inflation-quickens-record-380-september-2023-10-10/
Another Arab Spring type uprising is certainly possible given so many Egyptian's are hanging on by a very thin thread
Country diversification is all the more important for Centamin today - but I don't see Doropo being economically viable unless more gold is found (yet I don't think they are even looking at the moment) so what will become of Doropo ? Another Batie West/Konkera loss ?
Hi Somnamna,
I just finished watching the presentation replay and a few things stuck out - regarding the waste stripping ratio, too little detail was given regarding how the Capital waste removal project dovetailed into what now remains a permanently elevated strip rate. Surely the assumption was getting a whack of let's call 'pre-stripping' done let's say 'more efficiently' by a dedicated contractor team was going to improve on the previous LOM rate - but nope - it went up and they pretend it went down. Fibbers.
Next, the decision has apparently been made to hook up to Egypt's power grid. The benefits are touted as reduced carbon emissions and cost improvements. Except it doesn't accomplish the first, as 90% of Egypt's electricity production comes from burning fossil fuels, mostly oil, some gas and 11% solar/wind. Out of sight out of mind doesn't help the environment - just optics on site. And second, the is no guarantee electricity rates won't rise - currently Egypt subsidizes the cost of producing electricity for consumers/industry but we know how subsidies were removed from diesel fuel in the past. Also, the danger of relying on the national power grid over self-generation isn't worth the risks - power outages are a real problem to avoid at the processing level
Next, AISC aren't budgeted to come down below $ 1000 until 2028ish - anything can happen to those pie-in-the-sky projections. So why pretend that you've achieved something in the way of cost reductions until they actually occur? Dumb.
And then there's the high grade Bast zone not being able to be processed until 2025 onward - what was the holdup on the gravity circuit? They first talked about its 'close proximity' to the underground stopes in 2020. 5 years later it might get incorporated? Sheesh.
All in all I don't see a catalyst to get excited about unless the new concessions hit some great prospects - even then the timeline goes out so long to production - hard to justify a buy
I suppose Mr Horgan feels whatever he says today won't be scrutinized in the future so speculate away - only thing is the under promise over deliver days at Centamin have turned into under promise and underdeliver - but that's only my take - i'd like to hear an alternate view by current shareholders - please convince me I'm way off the mark
The glaring lie in today's revised LOM being:
Optimised open pit
· Redesign: Improved geological and geotechnical understanding of the orebody, alongside improved ground conditions following the incorporation of paste fill has resulted in a re-optimised open pit design.
· Reduced strip ratio as a component of the redesign: Optimisation of the open pit wall angles alongside an increase in ore tonnes has resulted in a reduced strip ratio of 6.5x
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Yes, reduced from the ridiculous one-time Capital Drilling waste stripping contract of >10x
but more importantly it represents an INCREASED from the previous LOM ratio of 5.3 to 1
Mr Horgan has proved time and time again he's a fraud - spinning the latest figures as improvements when in fact it's not
I don't know who posted it a few weeks ago about a Sukari plant disruption causing missed Q3 production target - but we all poo pooed him as ill-informed - I even think Tibbs might have checked with shareholder relations (correct me if I'm wrong Tibbs!) so it turns out he was right !
Whether or not Q4 makes up the missed ounces is really irrelevant - the most important fact to come out of this update is CEO Horgan cannot be trusted - he doesn't know what truth is
1:30 AM · Oct 10, 2023 - 251 Views
Last week we welcomed our #Board of Directors at #Sukari. In addition to Board & Committee meetings, they were able to witness first-hand the significant progress being made by our dedicated team in #Egypt to grow & optimise the #SukariGoldMine. 🤝👷♂️👷♀️
#CEY #gold #governance
pics here:
https://twitter.com/CentaminPlc/status/1711645288664793209