Member Info for Dubliner

There was a comment posted yesterday from one of the posters here regarding the most recent RNS and its mention of bulk samples. The poster perhaps reasonably questioned why more bulk samples are needed at this stage given the previous bulk sample work undertaken.

First a reminder of bulk sample related info posted via earlier RNS.
I will follow up with my thoughts (and it will be IMHO) on what this is all telling us in part 2.

>RNS 30/10/18<
“2 tons of Perlite successfully expanded by one of our potential customers.
100 tons of Pozz ground in a commercial production mill – tested positive”

>RNS 14/08/19<
“7 ton sample of Perlite processed to trial mobile primary and secondary crushers and high frequency screens to prove the concept using mobile processing equipment”

“Horticultural grade raw perlite product expanded successfully in customer’s commercial scale plant”

“Larger trial planned for100-ton bulk sample already collected to produce larger amounts of horticultural grade perlite for supply to a wider range of potential customers”

>RNS 20/09/2019<
“Following the reporting of further successful commercial scale perlite expansion tests the Company has received strong enquiries from a number of potential new perlite customers. The Company now plans a series of larger commercial scale tests and intends to process the 100-ton perlite bulk sample currently located on site to produce additional supplies of crushed and screened horticultural grade raw perlite for supply to these new customers”

>RNS 15/05/2020<
“Up to 22.9 acres of surface disturbance related to exploration activities will occur within the Project Area and will include programmes of drilling and bulk sampling which will allow extraction of much larger samples than have been permitted to date. These samples are required to secure sales contracts and generate initial cash flow”

Also

“Following the issue of the BLM’s Decision of Record and FONSI the Company is required to submit a reclamation bond within 60 days and before mining can commence. The Company’s Plan of Operations is phased, allowing the amount of the initial bond to be minimised. Initially only the drilling/bulk sampling will be bonded and the bonding for mining phases can be bonded very quickly thereafter, as required”

Hi AGEOS, that cheered me up after a tough day!!
Sorry did not respond on your previous posts - amazing what you pick up that most of us miss/missed.

I have felt for some time here that we have a very strongly interested party for our Pozz for the initial 100K tons per year which Patrick has talked about consistently for 12 months. I think most of us have an idea who it might be but lets not count any chickens..

All these posts with my name in the subject line - it is going to my head..

By the way folks we will have the interim results probably sometime next week so maybe will get some more info from Patrick...

Mmm that theory was wrong then - apols Tottyman!

Hey Safe perhaps he can do something about the Price of Oil while he is at is coz my Oil share is on its bottom! ;-)

MMs offering .12p to sell but not a hope I will be selling.
I am stocked up on lemming food so can carry on holding (!)

Hi Losesalot, am expecting PC to avoid placings for any of this if he can. Hoping Fulmar is correct about some upfront Capital.
With a permit in his hand reckon Patrick will have no issues in raising Capital without diluting us.
I just added a few too (around 1.5M)....

Cheers for all the posts/responses etc.
Dfens, good info on the powerline and good to have your US knowledge here.
Sam - 1st Prize on the FONSI (soundalike)
Min - cheers, what did you think of my thought about SRES having a 'man onsite' - is that normal?

>Capital cost & Contract mining<
For those who did not see the podcast last November;
https://omny.fm/shows/dig-deep-the-mining-podcast/the-wonderful-world-of-pozzolan-in-conversation-wi

If short of time listen from 17th to 23rd minute. PC mentions a cost of $2-3M to bring CS into Operation and I believe this includes the reclamation bond. He listed options for Crushing/Screening kit; Rental, Lease or put in by a Contract miner.

To me it seems most likely we are going down the Contract miner route. The Contractor will do all the heavy lifting and we will pay per ton for mining/processing. They will employ all the staff and use their existing plant (dozers / haul trucks) etc.

Assuming our SP increases when we get the permit (and Henry Winkler – a prize for first to work that one out!) and offtake deals are announced. Let’s say our MCAP then is well North of £10M a loan of circa £1.5M is very doable, that would be a very low gearing level and eminently doable.

>Contract mining – cont’d<
I note this in section 2.1.8.1;
“The Project would not include an on-site vehicle wash down area. Mining operations are expected to occur on a campaign basis. The mining contractors would conduct vehicle wash down activities at their yard, which is located off site”

So it seems we already have the Contract miner lined up and ready to go as soon as we get the necessary permits hence the above statement about vehicle wash down. No doubt a contract is prepared and ready to be signed if/when the permits drop. The one thing I wonder is whether Sunrise/SR Minerals would have their own Company man onsite to ensure things are all done ‘correctly’! I was out walking earlier and even thought there would be a nice little job for a certain person who is leaving Tertiary shortly but I quickly dismissed that theory as me getting ahead of myself!

>Powerline alternative<
Most of the sections talk about a powerline alternative. It seems due to timescales / costs that we are initially going down the generator route for all power requirements but the Plan covers what the alternative impact would be should part of our power come from being connected to the grid. Am guessing Patrick does not want any holdups to Production whilst waiting for a Power utility to connect us up and it is probably not a simple job (or cheap) as seems that would be tied in with a possible move of existing pylons.

>Sales at the gate and distance our product is travelling<
Table 3-2-5 on page 3-10 of the main PDF is interesting. Where our Customers are located is still confidential. It talks of sales being done at the mine gate with Customers organising their own Transport! Looking at the average miles travelled per ton of product in Table 3-2-6 very much suggests customers are in some cases quite distant from the mine.

That will do for now. I might dig out my list of reasons to invest in SRES later.

Morning y’all herewith some thoughts and a disclaimer; below is AIMHO and what I know about mining you could write on a pigeons derriere.

>Income from Bulk samples<
Noticed below statement in yesterdays RNS which suggests that we have customers lined up ready for bulks samples and these samples will be part of establishing contracts. Importantly we can get some money in for these larger samples – see cashflow comment;

“Up to 22.9 acres of surface disturbance related to exploration activities will occur within the ProjectArea and will include programmes of drilling and bulk sampling which will allow extraction of much larger samples than have been permitted to date. These samples are required to secure sales contracts and generate initial cash flow. These exploration programmes will also test for extensions of perlite and natural pozzolan which are open ended and project beyond the current pit limits. This includes evaluation of the extensive Northeast Zone which so far has been tested by a single drill hole which intersected 40m of high quality natural pozzolan from surface. Previous exploration suggests that the Northeast Zone target extends over an area at least as large as the Main Zone and is an exciting target for further evaluation”

>Why Extension Drilling?<
Am a bit intrigued why we would need to do exploration drilling right now when we have at least 27 years worth of known product at expected production levels. I can only think that perhaps Patrick wants to make sure that the sheer scale of this deposit is better understood and perhaps that relates to ensuring we get a fair price should someone with deep pockets coming knocking.

>Potential years 1 to 3 volumes<
From page 1-3 of the EA PDF document it seems we are targeting 906K tons of product over the first 3 years. Lets work on $80 per ton for that based on majority being Pozz. I reckon that to be $72.4M or $24M per year in Sales as an average although it will doubtless start lower and build. If we can get a 25% profit level (the SVS research note suggests a quite specific 29-30%) then we are looking at around $6M (just shy of £5M) profit margin per year on average which is not too shabby.

>Public comment period<
Whilst we wait for the public comment period am sure that Patrick will be getting things ready such that we can hit the ground fairly quickly after we get all the permits thereby ensuring time is not wasted. I would hope he is lining up finance for the initial Capital spend which he flagged in that diggers podcast - circa $2 to $3M if I recall.

Might add a part 2 later over the weekend but got some lavenders to plant – my life is so rock and roll!

Good news chaps our Project is now up on the BLM 2.0 website.

Hi 1Investor, hope you don’t mind me commenting on your post. Some observations.

You suggest more drilling has been carried out since the SVS research note. That is actually not true, the last drilling was done approx 12 months prior.
I don’t think the size of the resource right now has much bearing on the S.P. We have more than enough resource at CS certainly for Pozz and when Perlite runs out we have NewPerl.
Consider also on this front that the SVS research note was based on a 15 year mine plan (see page 2) but the plan of ops submitted in May 2019 was for a 27 year mine plan;

In the Company’s announcement of 30 October 2018, a three-phase 15-year mine plan was outlined providing the option to mine pozzolan from either the Main Zone pit or the Tuff Zone pit, or both with separate alternative mine plans developed for pozzolan in each zone. The Plan of Operation now submitted includes both alternatives and envisages a longer, 27-year, mine life where both perlite and natural pozzolan are mined from the Main Zone in Phases 1- 3 (years 1-15) with pozzolan continuing to be mined in the Tuff Zone in a new Phase 4 (years 16-27).

We know there are other areas of Pozz at CS barely drilled so would not get hung up on resource size.

Also bear in mind the SVS note was written after the Jan 2019 raise and in their valuations they were expecting us to burn £100K per month and I believe we have burnt way less than that.

The financial markets are fickle and we are in a different place to Jan 2019 with investors chasing the biotech stocks. I think permit approval will have a positive impact but the main share price driver as we have always said will be offtake deals being signed. I think then investors will start looking at the hundreds of millions of tonnes forecast over multiple years, multiplying by 80 to 100 bucks per tonne then thinking whoah this is a cash generating machine.

Oh and final point was pleased to see that we can just bond initially for works related to bulk samples thereby preserving cash until those deals are in the bag.

Have a nice weekend.

Agree this has been a long time coming but the starting pistol has effectively been fired and momentum should build from here.
All the best...

Good to see that, nice spot SGD. Not on the 2.0 site yet that I check...

Mr Fulmar that is very amusing!

Guys (I am pretty sure most here are blokes) it seems to me that we broadly have several camps.

1. Those who are invested and hope that we get the permit and then move on to mining and are generally hopeful/positive that this can be a profitable business in the future. Even those in this category will be frustrated at the delays.

2. Those who are invested (some for many years) but very angry with Management over the slow progress and disappointed at the lack of progress. People in this category are frustrated at people who are in camp 1 and don't share their anger.

3. Those who are not currently invested but perhaps would consider doing so if the SP dropped from current levels as they think the current SP does not adequately reflect the risks / start up costs etc.

I make no bones about being in camp 1.
I have no intention in getting into a row with other folks even if they are in camps 2 or 3 and have a different view.
I have only ever met one other poster here that I met at last years AGM and he was a thoroughly decent chaps but owes me a cuppa!

So an appeal to all here to please stop having a go at each other.
There is no point and there is unlikely to be a 'winner'
Everyone pretty much knows which camp they are in yes I know it can be frustrating if folks post in an inflammatory way but perhaps the best option is to ignore or filter rather than exchange insults.
All the best..

So why not just nail your colours to the mast

Hi Ice, none of my business I know but Safetrader1 was correcting his post where he was lamenting SRES's Market Cap (MKT Cap or MCAP) being only £4M. He was comparing SRES with, it seems, ACP, where it seems things are doing better.

Losing a CEO would be a bad news story for a Company but in this case don’t think the Market will take it badly.
Interesting now to see who CF brings in, it will no doubt ultimately strengthen the BOD.

I am not the only one to clock the 17.55M sale earlier. This exactly matches the fees that Peterhouse recently took as shares for last years £350K placing. Good that they took shares rather than us paying that fee from the raise. Pity they did not want to hold and guess this explains how recent bid dropped to .09p to deter other sellers until these were sold. They are sold now and as Sam said dummy buys of any amount today went NT.

Not sure whether to point out to Mr Jones he popped back at wrong poster. Think I will keep out of it!
Laterz y’all.

Nice article Sam, thanks and take care youself!