Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
n888, granted the individuals that make up Boris' cabinet are a bunch of numties, HOWEVER, the first past the post system has its limitations but speed of legislature I'm afraid is really not one. Most European countries have STV voting systems which are good for representation but often lead to coalition governments which are unbelievably slow in legislating for the obvious reason that rarely can they all agree. The US bicameral system is arguably worse though as literally every policy, no matter how good or moral, is run as a red/blue contest - beyond some minor presidential powers, old-Joe is pretty stuck in getting big change through the house. China, Russia, North Korea, fair enough, they do what they want, but they aren't giving a toss about SAF so aren't relevant. So, apologies, but unless you're from Norway with good intentions and have oodles of oil cash, I don't really understand your point.
Roger, I think you're confusing POW with a mining company. It's not a mining company, It's an exploration company. Drill programs are expensive, but they cost nothing in comparison to the infrastructure and opex required for a working mine. Mining companies sometimes have exploration arms within the company structure, but it's also fairly cheap for them to just buy licenses off exploration companies when they they know they have something. Same with loads of other industries, retail agents/brokers/recruiters/salesmen etc. they run around chasing the quick revenue, then larger corporates just simply buy they IP and enjoy the long term revenue. Some mines take several years of digging before they even reach the commodity they're after, no exploration company could or would fund that, and you as a shareholder in one would go loopy if an RNS came out stating 'doing an equity raise every year for the next 7 years, and then in 2029 we'll start selling metal'.
Trying to quantify the number of shares that have been issued as part of acquisitions, have I missed any:
Pilot Mountain
Total shares issued = 48,118,920
sellable in 25% tranches (28/02/2022, 31/05/2022, 31/08/2022, 30/11/2022)
(doubtful Thor will enact the 4p super warrants before 31/08/2022, so that just leaves their 12,500,000 options in addition to the issued)
FDR Australia
Total shares issued = 23,333,333
sellable - not specified but presumably still held as issued at minimum of 2.75p valuation.
(an additional 23,333,333 warrants were issued, as well as net smelter royalties).
Garfield
Total shares issued = 2,250,000
sellable - not specified but again issued at strike price of 2.25p so presumably still held
(further 2,250,000 warrants issued at exercise price of 3.25p)
Think it's just these three acquisitions that sit alongside the warrants, happy to be proved wrong though.
Great operational update from POW, the two IPOs this quarter should hopefully give the SP the correction it needs.
PJ has mentioned a few times that "it's easy to work out who the sellers are", does anyone know who he is actually referring to? Looking at the biggest shareholders they all have vested interest in POW or have shares as part of a quid pro quo. The only big shareholder I can't work out who they are / why they're invested is Mohamed Zafar Quraishi, but he/they have increased their holding in the last 12 months by the looks of it. Anyone have any ideas?
I should've also added that on the flip side, if ALL outstanding options/warrants were exercised today, we'd see a 11.9% rise in todays share price. This would obviously reduce as this share price rises, the tipping point for where the total outstanding begins to drag the share price down (if exercised in one big go) would be 2.22p.
Note though this is all very hypothetical and not actually how it works, but it's interesting to consider as this is what the directors would consider when structuring acquisitions and sell offs, 'how can we create pull effect on the share price, rather than a drag'. The furthest away expiry date if Oct-24 and is 12.5m warrants on Pilot Mountain, at a share price of 4p. If that were today, this would be a huge pull, but I would hope by Oct-24 we would we moaning about how much of a drag a 4p warrant is.
Bumble is right, the spin off model will help the working capital position of POW.
Additionally, as there are still a number of options/warrants outstanding there will be some cash flow from this. Fortunately, there are only 6 tranches of negatively impacting (i.e. exercise price being below the current SP) warrants/options left (4 of which are Directors which is slightly better news), for a total volume of 159,683,937 and an average strike price of 0.83p, which is equivalent to -6.8% of share price movement - in other words, if they were all exercised today the share price would drop 6.8%.
Cash flow coming from warrants & options upcoming (based on expiry dates):
2022
- Feb £247,279
- Mar £78,750
- Jul £1,398,091
- Dec £2,310,000
2023
- whole year £17,791,250
2024
- whole year £24,415,537
In short, lot's of cash flow over time coming into POW if all options are exercised, and this is without considering any cash received from spin-offs or POW investments.
Ivans, we have plenty of dosh, at last count I believe it was circa 2.2m of working capital - PJ regularly adds the figure to his RNS' so won't be long til we get a more up to date figure.
Additionally there have been drips and drabs of share options and warrants being cashed in over the last few month so that'll be helping to counterbalance the costs of the various drilling operations.
Just looking at comparable IPOs, I wouldn't be surprised if the comments made on the last RNS about the possible full sale of the Athabasca Basin licenses were made with the 92Energy (ASX:92E) story in mind. 92E IPO'd in Apr-21 on assays (albeit extremely positive assays) from a very early stage drill program, it listed at AUD 0.30 but then shot up to 0.80, and now sits at 0.56. Not ridiculous growth but a good sign of the market. Demand for Uranium is due to outweigh supply substantially by the end of 2022, likely triggering a price rise, and so these exploration projects 'should' become fairly sought after - in theory.
I've tried to find similar for IPOs for the POW potentials, it's a fairly mixed bag and obviously tricky to compare apples and pears, but 2021 did look fairly positive for junior explorers. I did think it all sounded a little too easy to say 'just IPO it and get the market to pay for drilling and get - win win' but looking at the mining IPOs in 2021 it does seem a little bit more believable (not to mention 2021 was generally a pants year on the markets - apart from if you managed to jump on a renewables stock early and jump off at the right time).
It's a bit bamboozling isn't it! Just goes to show how much work (and legal expense) it takes to have a global footprint , and one that I'd imagine is fairly tax efficient.
Does anyone know the purpose of Cobalt Blue Ltd and/or Regent Resources Interests Corp? Presumably they aren't SPVs for potential exploration sights... Or are they purely for tax purposes / might even just be legacy from POW pre-19?
Thought Oliver Friesen came across extremely well in the Telegram Q&A, clearly knows his knitting.
Thanks Mjd, appreciate the response. I suppose I naturally leaned towards there being US involvement in this FSP somewhere but I guess with a buyer from say China, fraying relationships with the 'West' might actually encourage a deal to be done, to further improve ties with the State. I guess it all totally depends on who the buyer(s) is/are. Equally , at the moment there doesn't ever seem to be an opportune moment for this deal to go through, there's always a new variant, a riot/protest, natural disaster, an election, so war with Ukraine might just be another unfortunate bit of background noise.
It sounds increasingly more likely that as the ground freezes in a couple of weeks, there might be 'some' argy-bargy between Russia and Ukraine. I don't think anyone (bar maybe Mr. Putin) has any certainty of what will happen and what the fallout/repercussions would be of any military action, but the MOEX (russian stock market) and Russian-trade flow clearly seems to be reacting, whether that's pre-emptively or due to sentiment I'm not sure. But considering EUA seems to be gathering pace and the end feels to be more tangible now, does anyone know what the impact would be on EUA? I can imagine economic sanctions imposed by the US or IMF (on Russia) would probably be worst case scenario, but do you think, should it end up just being a bit of sabre rattling of handbag swinging (which I imagine is the most likely/optimistic outcome), is EUA far enough removed that, that the good ship can sail on unencumbered, or would Dmitry and the boys have to delay until the smoke clears?
Disclaimer, I'm not 'de-ramping', just hoping someone with better understanding of this stuff will be able to shed some light.
OIMFHO and GLA and ALL THAT GOOD STUFF.
Bumble, that does all make sense, managing a company is managing a company, it should be a fairly transferrable skillset, I was just slightly surprised given the niche nature of junior exploration that there wasn't a more natural line of provenance. For the record I've been a POW holder for a year or so, and couldn't be more happy in my investment, but due to that I'm now proactively trying to pick holes in it to test my own rationale. It's very easy to convince yourself of something, and then put that decision up on the top shelf with no further interrogation and view it as immutable fact.
I hope you're right that assay results will help the SP, it seems at the moment there's so much market dislocation that only covid and sentiment move the dial anymore, facts and figures don't seem to matter. I sadly think we have another year in the woods yet, happy to wait it out though.
I’d like to prefix this question by saying that I obviously understand that people’s online presence doesn’t sum them up as a person or their experience/expertise. However, I was a little surprised looking at PJ’s LinkedIn how varied his professional history is - only the very latter part is mining focussed, a large part of his early career was in what looks like marketing. Clearly that experience is proving useful now as POWs marketing and communication to PIs is brilliant, but the cynic in me is now asking is it too good? Please do have a look yourselves, and please do correct me if I’m wrong but something strikes me as odd about it.
Equally, I did know Oliver Friesen ran his own consultancy and probably invoices to POW on that basis, but I also would’ve thought he’d have some reference to POW on his LinkedIn?
Shout me down if this all just sounds like superstitious nonsense. GLA