Member Info for Dee12345

@Amtech

Must I report your account for being hacked?

Daresay that's the most legitimate criticism I've heard you make of this company ;)

They certainly made a mistake using the phrase 'imminently', and made another mistake by not correcting it.

I think I stated months ago (Either here or on Telegram) that 90% of this frustration was due to that one particular word. If they didn't use it? Half the traders who entered probably wouldn't have, and the longs would be a lot more understanding.

@wasa I did put a higher graphite basket price, but I'd be inclined to agree that I ought to halve the 66p target on the basis of Free-Carry, Jurisdiction, and this being on AIM. Predominantly, this being on AIM.

I made a DCF last year, (available on The Telegram Group)

Please Note, it doesn't factor in Jurisdictional Discount, excessive dilutions, or additional Free-Carry.

Using the following assumptions:

Basic Tax Calculation: 30% Corporate Tax Rate. 3% Royalty
Graphite concentrate at $1,500
CAPEX at 8% debt. 70% Debt-Finance.
Dilution at 10p
$1 = £0.72
EBIT calculated by kT mined multiplied by $1500. Converted to £ from $
This is NOT factoring additional production increases
Added 100m shares instead of 86,085,000 for dilution

EV/EBITDA 141,804,000
Average 70,902,001

Factoring in a 15 year LoM, the DCF came back with the following:

Rate of Return
Target Price Upside 997%
Internal Rate of Return (IRR) 49%

Market Value vs Intrinsic Value
Market Value 0.06
Upside 0.6
Intrinsic Value 0.66

So from 6p, full production values this at 66p.

Again, that's not factoring additional country risks etc.

I'll post a link to the full DCF when I get the time to copy it to a new sheet.

@OldmanJoe

Content can be the most tedious and time consuming thing to do - So I can understand why they'd have copied and pasted (with a few amendments), with a view to changing all the content as time goes on... I'm just pleased as it's a start!

They've even tidied up the Corporate Presentation!

Better layout, with a much cleaner website - The content looks to be a little bit of a rush job, but let's see how they update and build it out as time goes on.

I'm not complaining :D

No harm in mentioning toxic funders - It always serves as a good warning.

Pallinghurst (who hostiled Gemfields) has made NMG look a lot more sour than it needed to.

Even here, with early stage funders such as Kabunga; We're still feeling the brunt of their past mis-deeds.

Well thankfully this is being played at the pace of a correspondence game!

I'd say it's a Berlin Game, Wasa ;)

@Wasa - From what I remember when looking into Ecograf, they had a heavy focus on vertical integration and processing, so I'd imagine it's the reason why they've been so quiet.

@Glengarth - Greenwing is another to keep an eye on, as they're looking into re-opening an existing project that was mothballed.

I wouldn't touch Volt with a bargepole, though. Kabunga (a Director at Volt) has been responsible for a lot of the selling post-ML here, and the ridiculous options/warrants that we're at the tail-end of at ACP, is in full steam over at Volt.

Good point Wasa,

I'd also recommend this: https://www.benchmarkminerals.com/membership/more-than-300-new-mines-required-to-meet-battery-demand-by-2035/

As recommended reading for a lot of people here.

They've been talking about lithium for years, but they're only now starting to talk graphite.

Everytime anyone takes the time to address a question Amtech may have, he will sidestep the issue, and raise another point.

It's almost as though all he wishes to do is to raise the doubts of others.

In our discussion yesterday, he was annoyed because ACP didn't explain how TANESCO's projects are funded.

The good thing about these characters are, they eventually show themselves up.

Plenty of things are public knowledge, that neither ACP nor BKT have mentioned.

TANESCO is being run as a business. Government owned, but run as a business.

They tend to have their projects funded, either by companies, foreign governments, or global institutions such as the World Bank etc.

So no, TANESCO will not be funding it out of their own pockets.

I guess it's something that doesn't need to be mentioned, because it's considered to be a given.

I agree with you regarding the board. Very few don't.

But to answer your question, can you imagine reading an RNS saying: "We're waiting for infrastructure projects to be advanced to enable ACP to cut costs on building Mahenge."

On the one hand, it looks weak (even though it's smart). On the other hand, I wouldn't want to get into a game of brinkmanship with a better funded and managed neighbour. Let them progress, and ACP and quietly do their deals in the background.

Looking at the salaries of the BKT board, you can almost argue that you get what you pay for, but BKT can't exactly 'stall' their project because a competitor 'may' be trying to use their infrastructure to cut costs.

But if ACP release an RNS to that effect? COMPLETE different ballgame. Their board can openly state "We need to negotiate cost sharing with our competitors/neighbours for x,y,z reasons" - Namely, ACP piggybacking off their infrastructure.

So RNSing what you ask would be madness, and I'd call that incompetent.

I too, don't particularly enjoy discussing BKT or any other company - But it makes perfect sense to wait for them to make their move, commit to it, and then onwards as march.

I hope that explains why we're not seeing anything via RNS with regards to waiting it out.

So you now have the two weak points from ACP's DFS:

1. Road Transport
2. Power

You can now surely connect the dots and see why we're waiting on BKT?

Surely you can see this needs improving, and piggybacking BKT is the cheapest method of doing so?

Yes, this outlines the difference in the two companies - But this information has been there since 2018... You've had plenty of time to do you DD and figure that out?

@AIMtodeath - I've never had a problem helping people, but it does get frustrating when you're constantly having to repeat the same points over and over.

That's exactly it, Amaretto.

@AmTech

If you take a look at Google Maps, and go from Mahenge (Ulanga District) to Dar-es-Salaam, you'll see the distance is almost 400km in a straight line.

There are other highways that can be connected to, but I'm not sure whether BKT will be building a direct road, or more likely a connecting road to a highway (A7 looks to be logical, but there are 2 national parks on either side).

It is highly likely that ACP are looking to let BKT build this road, and save $20 million themselves by simply building in an access road connecting to whatever road BKT build.

Will BKT like that? No. Can they do anything about it? No. But these roads (and part of the reason countries open up to private mining) will always be public access.

Now with regards to power, I do believe there's a hydro-electric dam not too far away, but they'll certainly need to build infrastructure to bring that power to Mahenge. Again, this is something ACP can simply plug into. (Paying their own bills, of course!).

The Tanzanians have run a PFS into extending the power cables (TENESCO) for:

and read this bit carefully: "...to upgrade the power network to supply the proposed MGP load and service other expected growth in consumption in the region." - Taken from original BKT DFS

But it's another reason why countries open up to mining. A lot of the rural villages along the route would now be 'plugged in' - And ACP, too.

It's also likely to be a requirement to allow public use as it incentivises other projects to go into production.

I can't profess to know the ins and outs of this, but it's what it looks like to me.

@Wasa,

There's an interesting interview on Crux, where Matt Gordon spoke to two CEO's, and there's an interesting snippet here:

https://youtu.be/zOeiRFewZsI

In effect, what do you do during a poor macro outlook?

Mawson stated that you can't control the macro, and you just keep doing that you're doing.

The CEO of O3 mining however, categorically stated you're better off NOT advancing projects during times like this. Just wait it out, and be careful with your spending and investments. (Question from 1:21)

Echoing what you said Wasa, at 26:07, the CEO of O3 stated: " This is a cycle. We should not have a short memory. This is approaching the bottom, and those who have liquidity will benefit from the turnaround. We've learnt this from the 5 majors recessions we've had in history".

Two differing, but equally valid points of view. Personally? I'm in the waiting camp.

@pumpky, How did you go from Wasa's comment to withholding price sensitive news?

It's easy to book a meeting in 2 months instead of 2 weeks. It's easy to hold decisions and take your time as you 'gather your thoughts'. There are many ways to take your time that are perfectly legitimate. It's not about signing material agreements and then withholding the RNS.

The real fear that everyone needs to understand in this climate, isn't about RNS', advancing projects etc - It's about being fearful of companies that need to RAISE cash for operational costs. That's the fear. If (as with ACP) the company doesn't have cash issues? Then it's literally a case of waiting it out - That's all.

You're forgetting Wasa,

The vast majority of PI's are driven by the following:

1. Momentum
2. Herds
3. Emotion

1 - 2020 was all momentum trading. See something going up? Jump on the train, and ride it up - This doesn't happen anymore, so a lot of people buying into pumps are now stuck. This is how they started investing, and many haven't learnt otherwise.

2 - Novice investors like to go where the crowd goes. Enough hype on a Telegram group? It's a buy. Enough hype with Youtubers? It's a buy. It's safety in numbers, and where ACP doesn't have a herd of PI's, people are at a loss at what to do.

3 - Emotions drive people (not that it ever should with an investment). So when staring into the red, some people simply cannot handle it. It doesn't matter what happens in the future, how good the fundamentals are, how much news is still due to come, or the global macro outlook - (Graphite is finally starting to get some attention from Benchmark). People are emotionally down, and no logic will change their outlook.

Not much has changed her since a few of us spoke to MB, and some of us understand (albeit frustrated) that there are legitimate reasons to be waiting.

One thing people don't do, is compare the ACP price movements with:

A - Other graphite plays YTD
B - Other AIM resource stocks YTD
C - The wider market YTD

When comparing it accordingly, we should treat the lack of news as a blessing in disguise.

AbraSilver posted monster silver grades, and had a muted response from the market. - They can't re-post those grades when the market picks up.

Blencowe posted a very good PFS, and actually fell - Again, they can't re-post the PFS when the market picks up.

Every piece of news we drop into an abyss is a piece of news we will never have the opportunity for the shareprice to benefit from. It seems many now just want to see some quick RNS' to get to 5p so they can exit, and undoubtedly just put their money into the next pump stock like WSBN or something.

I know you probably know most of this, but it's more for the benefit of others reading.

I don't think Kabunga has much left, to be honest - Certainly not enough to temper any potential buying volume.

Warrants expire end of September.

So if by the end of October/November we have nothing?

Then I concur - There are serious issues.

But I'm happy to wait until the end of November for now.

Amtech,

Do you have September Warrants?

I'm actually hoping we don't receive an iota of news prior to these warrants expiring (30th September).

I'd actually be disappointed at this late stage if we DID have news.

The last thing we need is Kabunga and others exercising warrants and then selling heavily into news.

This is what happened a year ago, and we don't need to see it happen now.

That being said, I'd like to see MB take up his allocation irrespective of the shareprice.