Proposed Directors of Tirupati Graphite explain why they have requisitioned an GM. Watch the video here.
Tibbs I wouldn't say don't invest in Nigeria because done right Nigeria is a very large and interesting market and was actually the company I worked for largest market for many years. Our company having been established over 70 years ago "knows how it works" so whilst extremely challenging can also be very rewarding if managed properly.
Unfortunately I think Centamin would as a new investor struggle to cope with such challenges whereas Ghana and Ivory Coast are better structured and investment follows quite clear procedures similar now in Egypt since the new investment structure.
Experience is crucial when venturing into developing counties and in Ghana and Ivory Coast there are people and organisations who understand the procedures, have worked in the structures and know how to reduce risks and make things happen.
Just a quick note if you go onto the Centamin web site and look at Batie West it clearly states that the exploitation license expired last November so they aren't hiding the fact but unfortunately not answering questions on the impact of the value of the resource, or indeed whether they still have ownership of the resource.
Contrary to what I hear from other people who contribute to this chat I don't see any issue with developing a couple of mines in West Africa. I would prefer they were in Ghana but Ivory Coast would be my second choice over BF and Mali for example.
I like the fact that Ivory Coast isn't land locked and mining companies, contractors and service organisations are experienced in "how it works".
If we were talking Nigeria then I would be one of the contributors saying No to a West African venture but thankfully this isn't the case.
I haven't made a film in either West Africa or Egypt like Sotolo but I have lived and travelled both markets and would be happy to see Centamin develop Doropo and ABC. I also see no problem Centamin funding these projects using Banks, Export Credit Insurance organisations etc like most other companies looking at growth to develop these resources as this will strengthen their credit rating and hopefully their SP.
Tibbs the reason I asked about the expenditure of $100 million is that I understand that there has been a considerable amount of money spent in West Africa but I think it was quite early on that the geologists and their mining consultants determined that Batie West in particular was a complicated ore body. Whilst the mining of refractory ore isn't unusual it does involve complicated processing albeit not unusual. There is an extra risk and if Lycopodium saw it to be complicated and marginal then best out and concentrate on other resources in the initial portfolio namely Doropo where the ore bodies seem on the face of it to be far less risky.
daren love your confidence but I am not too sure we are going to see any profits for a while yet there is just too much waste still to shift and going owner miner underground will mean reduced ounces while they get up to speed. So costs out stripping ounces so unfortunately I see first qtr results in my opinion being disappointing. I do hope I am wrong.
Cowichan it was a question that I asked but didn't get answered an exploitation licence at Batie expired last November and I asked what will be the impact on the value of the resource and also does this mean that the resource reverts back to the Government. As I say no response so I do reckon it is a piece of bad news waiting in the wings.
Tibbs what is more worrying is that I think the BOD at that time believed what Pardey was saying and Youssef was just a political mouth piece he wasn't a qualified mining anything so just read from a script.
Even more worrying is Pardey believed what people on the ground were telling him because that was what he wanted to hear and he knew no better.
I will never forget Pardey's embarrassing presentation in Denver when he was saying something that was already known to be incorrect and Youssef repeated the nonsense a week or so later.
As far as I am concerned it all started to unravel after Trevor Schultz decided to retire, a man highly regarded by me and more importantly the mining community at large. This I think also coincided although earlier with the much too early passing of Harry Michaels who whilst he and I had our differences he was also well respected and a steady guy to have at the helm of the mine.
Listening to Martin Horgan I feel confident in what he says and what he says makes me feel he really does know what is going on at the mine face and also understands what needs to be done to bring success. There is no doubt in my mind that he is the driving force and that he has a team he trusts around him but I am under no illusions that we will see some hurt before the company gets back on track. There will be some in my opinion long overdue borrowing/gearing as the cash gets spent to right the ship and grow the business.
Tibbs unfortunately the 560/600,000 ounces are the reason for where we are today following the higher grades regardless of the repercussions and impact on the plan. It is worth going back to the early years forecasts and if I remember correctly projections were for a high of 500,000 oz's per annum. The resource can only be mined once and this is why I hated the over estimated forecasts because if you take 10% extra out you need to find 20% extra next year just to stay at the same level. Sorry doesn't work. Far rather have a smoothing out with the occasional bonanza than highs followed by crashes and the inevitable lack of trust.
Tibbs thanks the strip ratio question was answered very well I thought but the Batie West question didn't get an answer. Guess Burkina and in particular Batie is a bit of a problem that Martin could have done without.
I have as you may have gathered been able to listen to the presentation with the help of Emilie Hodson of Corporate Management also the lengthy Q&A and found the event enlightening and encouraging, only hope when we get the bad news about BF it is out weighed by good news from elsewhere.
I think Cowichan's question about the seismic study was also answered and justified, a few small curve balls but to be expected for an open forum.
Cowichan glad at least you had replies to a couple of your questions it does at least prove that we can access the board.
Unfortunately I had an appointment at 2pm yesterday so very disappointed that there is no transcript of the Q&A's so no idea whether my questions were asked and answered.
I have registered my disappointment to Centamin so hopefully in the future they will record the presentation.
If you or anyone else did listen in my questions were as follows do you know if they were asked and answered : -
"Since the issue relating to the instability of the west wall we as investors have seen the value of our investment more than halved.
“Exactly” when are we to see a strip ratio in the open pit at Sukari that resembles what is acceptable for a profitable mine?
The resource at Batie West in Burkina Faso said to be non core had an exploitation license valid until November 2021 so does this impact on the value and if so by how much and when are you going to realise a value for this resource? Are you under pressure from the BF Government to develop the resource or pass it back to them for development by another mining company?"
Cowichan the difference with the joint ventures in Nevada and Dominican republic is that they also share the investment costs and operating costs so an OK ROI for both companies.
Problem with EMRA is they are Government not private and at the same time non operational.
These are only my opinion certainly wouldn't guarantee that Newmont aren't a prospective suitor.
Steve, I know Newmont as a company and they are extremely conservative and agree that a 50% share of their net profits after what would be a sizeable purchase price doesn't compute.
To think that it is only now that Newmont is interested in Egypt is way off beam, they will have been monitoring what has been going on for some considerable time. I am not sure that even the new revised terms of business will actually suit their business model. As for how Newmont will if they feel it is of interest enter the Egyptian market it will be on their terms and I have serious doubts they would need to spend millions on buying Sukari. There are a number of junior mining companies with large areas to prospect and Newmont will be closely monitoring developments in these areas.
As for the comment relating to the boards buy in and high salaries I suggest you send a question to the board but this is something they might find difficult to answer in open forum because a negative response could have an adverse impact on the SP and a positive response well could that be bordering on insider trading, not sure.
Cowichan, History can't be changed only learned from and I live in hope that the current new members of the board understand the mistakes made by their predecessors and steer the ship back on course or preferably a better understandable course.
So my questions are related to when will Sukari be back to normal production close to or above the 500,000 oz p.a. Not projections finger in the air hopes and wishes, but realistic targets and something that gives shareholders and new investors confidence,
Also we need to know what is going on at Batie West and the impact of an exploitation license that expired November last year. This would normally mean either an application for an extension or reverts back to the Government so what is the impact on the value of the resource and is there a time when any sale or joint venture needs to be completed? A resource can't just be sat on it needs to be developed or relinquished.
I have always been a fan of a focus on relatively small number of achievable targets rather than the confusions of a large number of projects /targets and none being achieved.
One of the reasons why I like the contractor focusing on the additional waste removal and the Cey fleet concentrating on the mining which will also involve waste removal. This however can't go on indefinitely there needs to be a cut off date or a plan that is known and shared with us.
Cowichan,
The only reason questions won't be answered is if the answers will directly effect the SP so expect answers that are guarded but experience of the last few phone ins is that answers are normally provided.
If you have already submitted your questions then they will at the very least have time to carefully word responses and or maybe incorporate in their presentation.
Darren I think you will find the majority of the costs relate to a major waste management muck shifting contract. Double the waste is double the cost and some.
We aren't going to see true mining numbers until this contract ends and they move away from building an additional mountain of waste.
Just a reminder to everyone who wants to direct pertinent questions at Martin Horgan and his team the opportunity exists for 23rd March when there will be a presentation to retail investors.
One question is "exactly" when are we going to see strip ratios that are realistic to the running of a profitable mine.
BOD visiting mines is highly recommended if they involve and listen to local management. Also excellent if the BOD understand more than just the fundamentals as the answer to success is in the details. Unfortunately BOD's are comprised of financial corporate types "Gucci miners" not too many hands on grassroot types.
Examples Geologists aren't mining engineers and mining engineers aren't muck shifters and muck shifters aren't mining engineers, accountants, political appointees aren't any of these. Would any of these understand that there has been high grading practices I very much doubt it until it became obvious.
I have in the past had detailed discussions with Mining General Managers who are excellent in MIning technologies much of which I hadn't a clue and often needed my own mining engineer on the team to explain acting as an interpreter. Much of the problems being communication and open pit mining as an example isn't that difficult providing the guy on the digger understands where to dig and the truck driver knows where to go. OK very basic because considerably more required such as maintaining haul roads, compacting waste dumps, pit layout etc. Where it goes wrong is prior to the the guy on the digger being told where to dig.
So on the surface it all looks good until you are backed into a corner which is where Centamin found themselves and now having to dig themselves out of the hole.
So at the end of the day it needs someone who understands Mining engineering, geology and material movement and from what I hear Martin Horgan has a team around him that understands all of the nuances. So would suggest he has individuals targeting the weaknesses getting back to the basics.
Cowichan am I worried about the seismic report yes would be great to get a response from someone in authority even though the information might be difficult to understand, is this a priority I am not sure, as I would prefer the management concentrate on getting the major asset back on track.
Won't be long now until you can phone in your question(s) to the board.
Tibbs You are preaching to the converted and I thoroughly agree that the old guard were way short in too many areas but there is nothing you or I can do about history. As I say we now need to have trust in the new team and keep asking pertinent questions when the opportunity arises such as the phone ins, and doesn't have to be a phone call as they take questions in writing during the presentations.
As a bogger flogger of mining equipment I would have loved for the customers to double up on equipment but it was never ever the case and as I say to predict everything by way of parts that are going to fail over the life of a machine is only possible to a certain extent. I do have first hand experience of a mining company that did over spend on parts and components so much so they had more parts in their stock by value than the local dealer who were supporting numerous mines. The mining company unfortunately actually went bankrupt and the new owners a major mining house chose to go the contract mining route and it is still operating 20 years on with good profits.
I don't have any specifics as to Barminco's short comings during their contract so can't comment on your criticism of them.
I am not sure what hands on experience Centamin on site team has in working the Sukari underground resource, why should they as they have had a contractor doing the mining?
I have seen contractors actually make more money through efficiencies for the mining company than the mining company was able to achieve when previously doing the mining themselves. It isn't just contractor mining being changed to owner mining it works the other way around.
I can't comment on Egyptian tax laws as it relates to depreciation.
The NHS heaven forbid Tibbs this can't be compared with a mine and I was once a member of a trust and goodness inefficiencies and down right incompetence was enough to tear your hair out. I only refer to management not the medical teams who I have the utmost respect.