Member Info for ElectricLion

"Offers have been made to buy the surface rights from all landowners within the mine site infrastructure, 50% have accepted."

That's 50% of the landowners I think, not 50% of the area. A poster on ADVFN claims that those landowners that have accepted are the smaller ones. I fear it's possible that 50% of the landowners may account for less than 50% of the land.

In any similar hypothetical situation with a large infrastructure project and a large number of displaced landowners, we can imagine that some will sell quickly/cheaply, some will sell later for more money and some will not want to sell at all. It would be naive to think that all landowners will settle quickly/cheaply.

Therefore we might speculate that the theoretical limit to when we can expect 100% of the land to be purchased probably does not depend on the rate at which negotiations with those landowner who are willing to sell proceed, but rather what mechanisms there are to force the holdouts to sell, and how quickly those mechanisms can be brought into play. One assumes that such mechanisms exist, or else, how would any such hypothetical project get completed.

I am of course completely ignorant of what mechanisms exist in Nicaragua for such purposes, or how quickly they could be mobilised. The government is apparently supportive, though seemingly unwilling to do anything would could upset the apple cart once more but if Condor gets to a point where everything is ready to go apart from the land purchases, then surely the government wouldn't just sit on it's hands forever, when there's a literal gold mine ready to go.

Oh for goodness sake SS, do yourself, and all of us, a favour, sell up and push off.

So, coming at it from the other direction, the theory is that inflation rises - I guess it's mostly the oil price which would have a direct impact on AISC, which then goes on to affect transportation, etc, etc - and so "they" raise the gold price - I guess we're actually talking about banks buying gold as a hedge against inflation? And that "they" don't raise the gold price (barring short-term spikes) for any other reason than inflation? Interesting theory. Your chart is quite compelling, but correlation is not causation. Got any links to somewhere that might explain the theory in more detail? I'm a little skeptical TBF, but I like to think I have an open mind!

RR: You may be broadly right in what you say, but cherry-picking your time period for Calibre performance from the end of 2018 is a little disingenuous. The 5-year chart doesn't look quite so rosy. https://www.ii.co.uk/shares/calibre-mining-corp/TSE:CXB.

I saw somewhere that the IFC is now only (or at least primarily) interested in investing debt in very large projects. Quite apart from all the other issues which we are already aware of, we may actually just be too small a project for them to be interested.

Also, can't quite figure out why the AISC would rise with the gold price? Or do you just mean it will rise across the industry, as previously uneconomical deposits become economical?

Noel: You may also be right, but I struggle to take people seriously when they use phrases like 'MSM'. Seems to be right out of the phrase book of the alt-right/red-pill/conspiracy theory groups. Doesn't make you wrong, but if you want to convince people, best to stay away from such loaded language IMHO. No offense meant.

I have my own extremely bullish fag-packet numbers, which is why I'm here, however the fact that the market is currently valuing us at little more than a sixth of your 120p per share valuation tells us something. It tells us that the market simply does not believe it will happen, or at least, won't happen without crippling dilution, which would knock any per-share valuation on the head. Now the market could be a dumbass. Probably is. But it's the market we all have to deal with none-the-less. Due to Nic political situation and local protests, the market is likely to remain somewhat skeptical until we're actually pulling gold out of the ground and selling it, but in the relatively near term, the mine financing is the single biggest monster to slay IMO. If we can get finance without crippling dilution, and a concrete date for mine construction start, then it's very much game on. But until that happens, multi-bagger dreams may have to wait.

Yes, fully diluted means including outstanding options and warrants, which are detailed here: https://greatlandgold.com/company/

Just add them all up. I get 4,062,547,171 in total.

In a takeover situation, it is highly likely that any vested (exerciseable) options and warrants at a strike price less than that of the takeover offer would be exercised, raising cash and increasing dilution.

https://masterinvestor.co.uk/economics/mellon-on-the-markets-20/

"Long-suffering shareholders of Condor Gold (LON:CNR)should be pleasantly surprised, I believe, as gold goes up, and gold pouring comes closer to reality."

$300/oz sounds like an awful lot to me. Where has that figure come from? A quick Google turns up this article: https://www.kitco.com/commentaries/2015-06-03/The-Real-Value-of-Gold-in-the-Ground.html which is much more conservative.

I haven't kept any bookmarks unfortunately, but the sources appeared to be from the horses mouth so to speak. I have seen a couple of places where the protesters have publicly proclaimed their intents, efforts and victories. Facebook, possibly?

They were not trying to get into the PC to sit at the back and ask difficult questions - they were there to shut it down, and I believe they made that intent quite clear. I dare say they would have succeeded if there was no security.

The principle action I have in mind is the one which resulted in a legal case being brought against some of them, though as in every case where there are two sides, it is hard to be certain of the truth of what actually occurred.

IFC was one of the possible avenues yes, but just one possibility, no more. I think armed security guards for the PC can be considered separately to any other incidents. Armed security is commonplace in many parts of the world. The UK has an aversion to guns, which a great deal of the world does not share - the USA, just for starters. So I think the armed part is probably less significant than we may think. Secondly, some security at least was made necessary through the very threats and previous actions of the protesters themselves. As it was, they tried to force their way into the PC and would have probably made it impossible to continue had the guards not been there. We don't know the whole story, but the protesters themselves have chosen a confrontational route and the company has a right and indeed a duty to ensure there is sufficient security for it's staff and events.

FWIW, my impression is that while any police intimidation is clearly deplorable, that this was not a large factor in the IFC's decision. It is after all, outside of the company's control. I haven't heard anyone anywhere alleging that the company itself is involved in such action and so it seems a little unfair to penalise Condor for this. In addition it seems that IFC had reservations from before the trouble started and so, I fear it is Condor that dropped the ball in this respect, and cannot lay the blame entirely at the feet of the political unrest. I very much doubt that Condor had any ill intent in any way, but perhaps did not take the social situation as seriously as they should have early on, when these issues could perhaps have been nipped in the bud, in as much as that is possible. The social team has been significantly expanded in recent months, so at least these issues are being taken seriously now.

I don't wish to dwell on these matters too much, my curiosity was simply piqued by the suggestion that the IFC had withdrawn funding, which I imagined could have meant mine construction funding, which would have been news in the sense that we didn't even know that they had offered it in the first place. It now seems more likely that this is a translation issue, or perhaps intentionally misleading from the anti-mining lobby (who, FWIW, I believe are hardly whiter-than-white themselves).

Regardless, it is history now. The government is supportive of the project, as are surrounding communities, even if some La India residents are not. I continue to be bullish overall, though a breakthough on something, whether that be land purchases, toll agreement, financing or something from left-field would make us all feel a lot better.

http://www.cao-ombudsman.org/cases/case_detail.aspx?id=1278

Now only really of historical interest, but worth a look regardless. Use the 'View Documents' button for more, specifically the Compliance report.

Several points are raised in the report, though regrettably the theme seems to be that Condor did not adequately respond to issues raised by the IFC following their initial investment, which initially led to the IFC to abstain from additional investments, and then eventually to divest completely after (it is implied) Condor did not act on the advice of the IFC to carry out a security risk assessment following the unrest. The one spot of light seems to be that complaints related to groundwater levels appear to be unfounded. No other specific environmental issues are mentioned.

Clearly, we are largely ignorant of Condor's view on all this, but at best, it seems like a missed opportunity to have engaged with the IFC more thoroughly, which might have avoided some of the social issues we are already aware of.

The article refers to the IFC withdrawing funding. Any more info anyone can find on this? It must presumably be documented somewhere, apart from this unreliable-at-best (in my view) anti-mining group.

Just a note of caution with regard to warrants:
1.) 2.5p is 42% higher than we are now.
2.) Warrant holders would want the SP to be North of that before exercising them.
3.) Just because warrants can be exercised does not mean that they definitely will be.
I'm invested and bullish, but relying on warrants being exercised at a price significantly higher than it is now for funding is unwise.

nero. I suspect MC has in the past also been trying to get the company sold for more than suitors are willing to pay. Very few acquisitions go through at multiples of the prevailing share price, and yet that's what MC (along with many LTHs) believe the company should be valued at.

So yes, I think it's very possible that MC is not one of the 'in-crowd' precisely because of his efforts to look after his shareholders (and himself of course, as a large shareholder, but his gain is our gain too).

Yes, of course, and I said as much. By my tally, we're up to around 118M fully diluted right now. IIRC, MC has implied that the small mine would require little to no dilution. Conversely, I believe he has also said that the big mine would be quite dilutive. So my interpretation is he thinks he can raise somewhere between $30M-$50M without diluting too badly.

Once the small mine is in place then money starts accumulating for the bigger mine a couple more years down the road, again hopefully without undue dilution.

I think running costs should be considered separately from capital costs. You can get a loan for capital, up to a certain limit. There's probably no other way of funding running costs than issuing equity at this point, though a toll mining deal would take the sting out of that.

Disclaimer: the way I'm doing it below is probably (definately) playing fast and loose with the definition, but it's still valid I think and good enough for these kind of fag-packet calculations. P/E ratio is defined as market value per share divided by earnings per share. But the per share part in both the numerator and denominator can cancel out to just give market value (MCap) divided by earnings (total profit).

So I take the expected annual production of 150,000 oz multipled by profit of $800/oz at $1500/oz gold price to give annual total profit of $120M. Then just multiply that by your anticipated P/E ratio (10) to get MCap of (a scarcely beliveable) $1.2bn. Then divide by your anticipated total number of shares. Let's say 120M for this calculation, though I fully expect there to be more than this. Gives (a scarcely beliveable) $10 per share. Which matches what you have.

I do realise that it's a very rough and cavalier approach, but it seems broadly sound to me. Though do please set me straight if I'm way off! And yeah, I do realise that there's years to go and it's far from a done deal, which is why we're at 19p, but it's nice to fantasise sometimes! :-)

I don't think I would TBH. The market values our current 2.4M oz, and stage of development at £18M. No particular reason why it should value 5M oz much more than double our current depressed SP. And it would take a lot of time and money to get there. And after that it's still a pretty binary bet on whether anyone wants to buy our 5M oz for a price we'd want to sell for. We have got to be able to stand on our own two feet, can't rely on the kindness of strangers.

Yes, it's all going to take even more time. But I've made my peace with that. I imagine most LTHs have, or else sold up long ago. My motivation for staying comes from fag-packet calculations of where this could go eventually. 150k oz per year. $1500/oz gold, maybe higher. Minimal dilution. P/E ratio of at least 10. That's life-changing. And time wise, if it happens at all, it'll happen in less time than I've been here already.

I'll take a stab an answering some of that! Aguila's numbers are $30M-$40M for 40-50k oz per annum. I have no real way of verifying the accuracy of these estimates, but for the sake of the calculations...
If our AISC are $700/oz (likely to be lower, as the ore would presumably high-graded where possible), then profit per oz at $1500 gold is $800/oz. 50k oz works out to $40M profit a year.
Got to repay the loan out of that of course. Could repay the whole loan within a year, or stagger it over a couple of years, so remaining cashflow very dependent on how quickly we repay the loan.
Not sure what we would want do with the cash either - save up for the big plant, more drilling or a bit of both.
Not sure how the market would value that. I'd imagine the market would initially be skeptical until production (and cashflow) is well established.
After that I can only assume that the market would begin to value us on a P/E basis. Whether the market would consider the profit before loan repayments, or after, I'm not sure. P/E ratio would be conservative I would think, to account for the jurisdiction and the risk of just having a single mine, rather than a portfolio of producing assets.
On the up side, dilution would be minimised - that's clearly MC's priority, above all else. (Could this be one of the reasons why he (allegedly) doesn't get much respect from some of his peers? After all, this would move a lot faster if he diluted us to hell and back to raise the cash for either drilling or production...)
Hard to come up a final SP estimate, due to all the above unknowns, but the big picture is that $40M profit a year is a lot compared the current MCap. So whatever we do with the cash, the market should recognise that fact in some way.

While far from a glowing review, I think your bias is showing a little!

I find it a little odd he said he hasn't been able to get out - City Financial and the IFC were able to get out. The SP got a bit trashed, but they got out. Plus IIRC he contributed to the recent placing.

He acknowledges that there's "a lot" of shares he has got out have gone on to be "very happy stories".

He says the price he got in at was "fairly cheap" - I don't recall what price he originally bought in at, but likely to have been higher than it is now - so if it was cheap then, it must be cheaper now?

He says he's frustrated because it's been a little more complicated than he had expected. Well that's not news! The concerns he mentioned - Nicaragua unrest, social issues and unproven CEO are not exactly well kept secrets and are all in the share price (and then some) IMO.

He (kind of) likes the deposit, "the project is still good" and the CEO is a "decent guy" but "hasn't had any big wins so far".

Let's hope for all our sakes that Condor is the big win that earns MC a bit of respect.