Member Info for Dcat80

When AA left Zambia they relinquished the licences and it was grabbed by company called Zamsort who Arcm took a position in and ultimately took majority ownership of. There is no buy back clause/right (leaving Arcm open to negotiate with others and turn down any AA offer), however also at different stages of discovery with a small high grade deposit easily monetized, signs of potential large system, but at this time no actual large scale discovery such as racecourse.

Very different positions albeit AA potentially involved in both. Only thing I’d read over from there is part of AA process I.e. they’ll want their technical team to review all data then their deal team will either accept the terms of independent valuation, or if before 2mt offer an alternative not tied to independent valuation.

Personally I’ve held Arcm for over 4 years and knowledge gained during that time on wider copper exploration plays enough that when I saw XTR initial deal on Bushranger and the presentation on it I knew to wait for placing (1.2p) and loaded up then.

The April 2020 presentation is very useful, items such as $1m to drill 4000m for example does make me chuckle when someone pops up and says we’re now be short of cash!

The £5m placing certainly gives options now to amend development plans. Size of that placing surprised me out as I thought more likely pace would be dictated by success of the legacy manica assets providing income. That’s clearly not the case now, although still need to be prudent with cash.

Question is why raise the amount we did? Either it was a matter of Colin wanting to take funding when offered or a matter of striking whilst the irons hot i.e. with the excitement on the project accelerate plans.

No doubt makes sense to get a more basic understanding of what is at racecourse first (not necessarily drill out entirely, then plan after. Hopefully updated plans and insight into strategy will follow in the coming month or two.

Andrew - the buy back is undoubtedly over the whole EL5574 licence (its a defined area for starters, which racecourse happens to be in and has only current jorc) so after 2mt of AA exercise their right then they benefit more from any copper over 2mt, whereas if we drill and don’t jorc until much later we get the benefit of that 80% uplift.

It’s where our best interest and AAs are clearly different and probably the crux of icebergs thoughts on amend deal before so pace of exploration can be increased, whilst still giving Xtract good uplift to anything priced up later.

Questions that would be good to hear from Colin are

1) is he considering deploying another drill to test the other targets?
2) do AA geologists have access to our drill data/will they be given access to our drill assays as and when they come in? This matters as their own technical team will need to review the data and provide input to AAs commercial team.

At another play AA are in discussions (Arcm) their technical team were given 6months for a review in the form of exclusivity deal, then upto another 6months for the deal team to negotiate. Believe 6months was how long GGP gave newmont when they looked at them number of years back. Point being talks can take time and we’re also not sure how long AA have to consider within the buy back option or if we could for example drill footrot or other targets during this window.

It’s quite possible. If AA are keen they’d want to expedite progress for sure. As with any deal possibility just have to keep an open mind as both parties will have own views on how they would like to monetize and preferred way to do so. They’ll be compromise from both and it’s definitely in our advantage to have a keen major on board and not to say cut our noses off by being unreasonable in discussions. One thing for sure is the pie seems to getting big enough for both parties to do very very well.

AAs right is to acquire 80% of the deposit at fair market value. After that further development costs are dealt with pro-rata or we can elect to move to 0.75% net smelter royalty.

Those further development costs would include considerable infill drilling, potentially drilling of other targets within the licence, economics studies, permitting costs, economic studies and equity portion of any mine build financing.

Agreement could be made for Anglo to purchase 100% of mutually agreed by both parties, their right is for 80% that doesn’t mean terms can’t be agreed for 100%. How deposit would be acquired hasn’t been mentioned, however with a £37b MC and H2 2029 EBITDA of over $6b Anglo aren’t exactly short of funds...

If not 100% it’s for CB to decide if he wants is to be in for the long term, ensuring we always have funds to pay out portion of costs which has risks with AA then being project leader and dictating development speed of the project. Or to take the NSR option which whilst probably less beneficial in the long term would provide some more certainty and less risk.

If we sell 80% or 100% to AA then it’s upto Xtract what they do with the money. Return to shareholders via special dividend in part (less likely whole), or use the cash elsewhere.

There is no point bringing AA in before 2mt, unless there is a fundamental change to the buy back right. Nor is any other major or mid tier likely to get involved unless AA decide not to take up the buy back upon a jorc of 2mt contained copper being achieved or decision to mine made. They get just one opportunity to make that decision..

Can we expect some comms on trial mining application soon, whether being submitted or what other steps first required. Also would be nice in next RNS if more detail can be provided on what now funded i.e. whether recent placing would cover trial mining application and other works to get us to mine financing decision.

In only a few months this bb had gone from being one of the more depressing to read to one of the more positive - and rightly so. We got Bushranger for a steal as it was and drilling has exceeded the most optimistic expectations.

Personally still prefer a rig deployed to Footrot and other targets to test them. AA buy out would be based on fair value of the contained copper and not cut off at 2mt. Would be Bittersweet if licence sold on racecourse exceeding 2mt if another 1-2mt might be at footrot and/or the extensions.

To maximise returns CB will have to play it smart on when best for formal jorc. They’ll have their own internal rough calcs not done to formal JORC standards. Best to update jorc before 2mt then drill more or not jorc for a while. Would be nice to hear his thoughts on drilling other targets and how to best maximise our opportunity.

Heard JP will also be doing another crux interview

Not sure if Obelix still is. Timeline wise for Q1 production sooner submitted the better, only aspect we might still need is the dry magnetic separation results as that obviously affects the operation.

Took another £1k, was Nt when put the order through but took them over an hour to fill and stock became available in that time! Slow brokers

Simplest way is fill and kills when NT to buy.

I also keep eye on buys vs sells over few sessions. At Jangada we had just 60m of 248m shares outside of TR1, so roughly 600k buys = 1% of the free float. We also know lots of that free float is held tightly and not really available. When we shot uo before PEA there was something like 1.2m more buys than sells over the last couple of sessions. No one had appetite to sell, MMs were naturally short from selling shares to us and not being able to buy them back. More buys put more pressure on them almost like a short squeeze and we moved up quick.

MMs will often keep making it nt at times like this, hoping to wait out sellers.

Often see a lot of conspiracy on MMs, yes they’ll play games at times and try to kill a market if short. Overall though it’s generally demand vs supply and that can be monitored easily enough over a few sessions (delayed transactions make harder, but still possible over shorter periods)

Krayl- I was writing below when your message appeared and didn’t see. Hopefully though my posts answers your question, still looking to buy. Have some to put into isa, am waiting as well for company pension to be transferred to my SIPP before I can top up there

I think you’ll get from that why I get so annoyed with the hurried bid hitting. Little patience and wait for buyers and we all win!

Whatever I add share count wise now is fraction of what I picked up at lower prices, as such my methodology is more buying in a manner it moves our value (sp) up. Don’t mind paying little more in my top ups if it’s helping the value of my existing shares I.e. SP/MC increasing.

As far as I’m concerned we’re nowhere near fair value and as we all know when the herd arrives they rarely look at the fine detail of value disconnect, but rather % it’s gone up. Therefore I want a higher starting point. Plenty of news items expected that can trigger the re-rate, in all are interest to be higher valued when they land!

Explains my approach anyway. Not just about getting more shares which i definitely want, but in doing in a way that best helps my current holding

I’ll leave you guys to mop up loose stock for now then. I’m hoping to add circa another 230k shares, however I’ll wait until fill and kill buy orders are needed. Nothing I like more than moving those pesky lazy MMs when they try and stop buys :)

Why buy when you know the mm on the bid will offer something cheaper on the ask soon. Exactly what happens when bid is hit and it stands out very obvious on the illiquid stocks.

The seller isn’t helping themselves.

Assume the person selling at bid wants no one to buy. Idiot. Put me off buying anymore now

And another £1k.

Definitely a super cycle, everything is coming together at the same time. Will vary on different commodities dependant obviously on supply/demand, but inflationary pressures will help all.

Anyone added £1k when quiet.

Been nice buying, if seller acts sensibly and slowly who knows even more might be tempted to buy.