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Hi allthatguff,

Thanks for this !

I particularly liked that " [ Simandou] was seen as one of the most strategically important assets in the mining world. Its development was a threat to the three dominant iron ore miners, Vale, BHP Group and Rio Tinto Group, at a time of insatiable Chinese demand for the steelmaking ingredient..... It was in that context that Vale wanted the asset. ...
...it was so important not to let this get [into] the competition hands.”

I'm reminded of Tesco getting rapped for buying up promising sites in the UK, not to develop themselves, but just to frustrate the competition.

ATB

Hi NewKOTB,

Yes, I did ;->
Even better than intra-day is that it's before a long weekend, so lots of time for PI's to have a celebratory bevvie or three whilst they digest the news.
If Carlsberg were to write RNS's....
If there is material news for ZIOC, I think the RNS would have to be 'suspension', given our M Cap and limited free float.
And I'm with you - 100% would hardly be worth getting out of bed for.
Have a great weekend !
ATB

Hi Aberdeenman,

"Any significant news may require a mirror RNS from Glencore..."

Who'll be considering their Zanaga options very carefully (if asked) , given that
- GLEN is the leading international supplier of seaborne thermal coal;
- spent $ 3.7 bn last year on coal mines in Oz (oops ?!);
- has recently said it'll cap production at about 145m tons, 'for the foreseeable' (maybe to help prices);

OTOH China's need for coal for its existing and planned power stations sees coal's contribution falling ONLY from current 55% of energy mix to 35% projected by 2050 ie likely no reduction in absolute terms.

If China showed interest in Zanaga, GLEN might now be more minded to 'sacrifice a pawn' , taking account of the bigger picture.
And - as an 'option value' incidental, picked up as part of the Xstrata deal - there'd be no great emotional or symbolic significance to giving it up now.

All IMO
ATB

Hi allthatguff,

…"The market has not cottoned on to this fundamental shift in prospects..."

The recent rise has been on limited volume. ZIOC is probably too small (NMS) and illiquid to attract institutional interest...but a more adventurous HNWI or two might be interested in taking a punt in light of recent developments.

Over at NCCL, for example, ScottJFletcher ponied up a couple of million £ for a 16% stake in the company.

ATB

Hi Kr1ck,
.."I wonder if it will occur to the Australians to buy Zioc to prevent China acquiring it. .."

Nice idea, but I think it's a non-starter :
- there's no point the Aussies just doing a blocking manoeuvre to spite the Chinese - that would just irritate / invite material retaliation, for negligible benefit. Unless the Aussies were then to make the massive investment/commitment to C-B that we're all hoping that COIDIC has in mind : Zanaga by itself (no power, no rail, no port etc) isn't worth much.
- GLEN has right of first refusal if ZIOC wants to sell its share of Zanaga…..and has plenty of other interests in China that it would want to protect. It won't want to tweak the dragon's tail without good cause.
- ZIOC has Clinton Dines on its Board. " Clinton Dines (NED).. has been involved in business in China since 1980, including senior positions with the Jardine Matheson Group, Santa Fe Transport Group and Asia Securities Venture Capital. In 1988 he joined BHP as their senior executive in China and, following the merger of BHP and Billiton in 2001, he became president, BHP Billiton China, a position from which he retired in 2009..."
He's currently senior NED at Fonterra, New Zealand's largest co, with extensive dairy interests in China.
It's worth having a look at his linked-in profile for all his other business interests.
Dines is an old China hand who values Asian-style relationship building, I'm pretty certain he'd counsel ZIOC to kick any 'diversionary' Aussie approach into the long grass.....

[Incidentally, Dines has a seriously impressive CV and I think his presence on the Board of ZIOC is very good for the company's credibility...and potential]

ATB

Hi all,

Edison have repeated verbatim the CMD/Q&A comment :..." The test data has confirmed the world-class productivity of each well with both 205/21a-6 and 205/21a-7z exhibiting an INITIAL [my bold] productivity index (PI) of over 200stb/d/psi (cf to the Saudi super giant Ghawar field PI of c 140stb/d/psi). …"

I've asked Godalming Towers whether the current PI is materially different ie why the qualifier ?

ATB

Hi Kr1ck,

AIUI, the IMF has agreed 'in principle' to a debt restructuring/rescheduling.
As conditions precedent, they want to see certain things done on the structural reform front (promoting good governance, etc) and some 'level playing field' type stuff re existing debt.
China has made some moves (on rescheduling, not forgiveness), the oil traders inc Trafigura and GLEN have been under pressure to do likewise.
IIRC the traders HAVE recently made some concessions.
Everything is apparently due for review by the IMF in early July, to see if C-B has done enough.
If they have, that should unlock some new money from the IMF and - by giving a seal of Good Housekeeping to C-B - give other potential lenders the political cover they may need to go back to their credit committees and see if they can support any attractive business opportunities that might happen to be around.

All just my understanding , more than happy to be corrected !
ATB

Hi TCF,

No change since you last asked on the 14th...

From memory, ZIOC has to report its 31 Dec numbers within 6 months. On past form , they'll likely release these at the end of June...A quick runthrough of past RNS's tends to confirm this.

Apart from something material re COIDIC cropping up before that , the next 'hard' date is early July, when the IMF is due to decide whether to agree to/support RoC's debt restructuring.

HTH and ATB

Hi Caterham7,

This one -7th May - maybe
https://www.proactiveinvestors.co.uk/companies/news/919104/ncondezi-energy-worth-three-times-current-valuation-suggests-canaccord-919104.html

HTH and ATB

Hi bartlebobton,

.."Just can't see Dr T... reading those 3 highly informative lines...and thinking, ohhh blimey, why didn't I think of that..."

If you read my comments or had troubled to listen to the CMD yourself, you'd be aware that Dr T is fully aware of the issues (doh !) , likely painfully so.

Sometimes it's better to keep quiet and be thought a fool than speak up and remove any doubt.

Good luck with your other investments : if the level of insight shown here is representative, I suspect you'll need it.
ATB

Hi all,

Re water issue, as I recall the CMD presentation + Q and A, Dr. T said that it would be possible to 'bypass' any water - found in a future drill by 'logging while drilling' - by putting in casing at the relevant points when/before completing; and ISTR that he also acknowledged that - if they'd had their druthers - they'd have done this on the existing wells also.
The existing 'problem well' 7 could be re-completed, but it would be v expensive, both directly and indirectly (need to shut in for a while, etc).
Maybe they didn't expect to find as much water ? If so, an expensive 2020 hindsight false economy.

ATB

Hi Caterham7,

I think you're right re the Chinese desire to up their skill-set and move up the value-chain. It would seem that the World Bank was involved in helping set COIDIC up (back in the days when the US and China were on better terms), their #2 Nicholas Mintsos is/was a WB secondee. WB does a lot of 'technical assistance' to help countries up their game , and COIDIC may be one such. And although WB isn't apparently a shareholder in COIDIC, the announced shareholdings from the source doc only add up to 95 %, so it looks as though the intention may have been there.
I also find the COIDIC President's analysis of the challenges in Africa and the weaknesses of the Chinese as refreshingly - perhaps riskily ? - frank.
If they can walk the walk , like he talks the talk, they may be able to pull it off.
It was also interesting to see him reference PPP as a way of addressing sovereign debt issues, which again suggests an awareness of the need to keep WB/IFC/IMF on-side....COIDIC is not your run-of-the-mill project manager.

On a separate matter, I see your reference to NCCL (I'm a small holder there and look at it mainly for possible read-across to ZIOC), since you've raised a possible timetable for ZIOC end-game, let me turn the table and ask you what time-frame you see for something happening there. Due allowance for coronavirus, etc.

TIA and ATB

Hi oldabutnowisa,

SRT managed to accommodate PI's recently , see https://www.lse.co.uk/rns/SRT/limited-time-retail-share-offer-via-primarybidcom-g44zf5cjx1lva2t.html

Not perfect, the time for reply was tight, but do-able.

See CEO Simon Tucker's comments re PI support at end of RNS !

Suggest you forward to Pengilly ….just venting here won't make a difference...but making the point (politely !) to him might...

ATB

Continued....

"At the same time, there are subjective challenges. First, Chinese companies do not have enough experience to internationalize. They lack investment experience and management experience abroad, they also lack a staff that understands technology, business practices and languages. Second, at present, Chinese companies that are internationalizing mainly participate in engineering projects through EPC contracts, but rarely participate in operations at both ends of the implementation chain. They have long been at the bottom of the value chain for infrastructure projects abroad. However, a merciless competition is gradually reducing the benefits of project contracts. Third, Chinese companies have a biased [Ed.: limited ?] understanding of the laws, taxation, institutional systems and cultural concepts of the countries in which they invest, and their superficial understanding of international rules is not conducive to investment “

And here’s what this is intended to mean for one of their other target countries, Guinea .

For […….], read -across to Congo-Brazzaville …and think what the read-across might be.

“…according to the cooperation agreement signed by the two parties, the CPG [ Guinea’s version of C-B’s Ministry of Major Works ] will forward to COIDIC in the future the list of priority projects identified by […..]. After preliminary studies by the Chinese side, and after the two parties have agreed on the major projects, it will be up to COIDIC to finance them, appoint an ad hoc team to prepare a feasibility report and draft an environmental impact report and prepare a draft. Then, to help […] set up financing, COIDIC will join other Chinese financial institutions to finance well-designed projects. In addition, in order to control the extent of external debt and introduce advanced business models, the [….]government will encourage Chinese companies to invest directly, establish BOT contracts or form public-private partnerships [PPPs] to finance infrastructure construction projects in […….]. COIDIC will be able to help […..] draft, negotiate, technically evaluate franchise agreements, PPP agreements, operating and maintenance agreements, long-term purchasing service agreements, etc. Overall, COIDIC interfacing with the CGP and other institutional contractors will boost cooperation between China and […..] in infrastructure construction.”

On the face of it, the read-across sounds encouraging.

NAI, DYOR, etc etc
ATB

Hi all
I’ve been trying to get a better understanding of COIDIC and where Zanaga / ZIOC might fit in to its plans for Pointe Noire SEZ.
COIDIC was set up in 2016, with technical help of World Bank, see https://www.ecofinagency.com/finance/1310-35556-world-bank-will-not-invest-in-china-overseas-infrastructure-development-and-investment-corp
There’s a detailed Dec 2019 writeup here https://halshs.archives-ouvertes.fr/halshs-02425258/document , courtesy of GTA5 on advfn.
Brief takeaways :
Countries where active so far, Cameroon, Congo-B, Djibouti, Guinea , Ivory Coast and Mozambique.
Seemingly, not intended to help its Chinese parastatal shareholders just to venture abroad along the new Silk Road , rather to help them move up the value chain. Not EPC (engineering, procurement, construction), but rather BOT (build , operate, transfer), which implies some control of project revenue; BOOT (build, own, operate, transfer) – greater , but time-limited control; and – ideally- PPP (public/private partnership) – part (?) control ‘forever’….
Of Congo B’s 4 SEZ’s announced in 2013 , Ouesso and Oyo-Ollombo were set up with help of Surbana Jurong, Brazzaville by a Mauritian entity (Black Rhino ?) and PointeNoire with help of ‘China’ , later progressed (2019) by COIDIC. [Incidentally – and curiously – for those with long memories, Singapore’s Jurong features as one of the planners involved in demarcation of PN’s proposed boundaries.]
Here’s how their President Zhou Chao describes the challenges and opportunities in Africa [and, by implication, when describing the challenges facing Chinese companies, where COIDIC fits in] :
Q : “ What are the current challenges and risks facing Chinese companies investing in Africa?
A: It's not just objective challenges. First, most African countries have poor infrastructure, weak industrial foundations and inadequate industrial support facilities; where infrastructure requires significant and long-term upfront investment, a single company's investments often face greater risks. Second, Africa's financial environment, particularly investment financing, is immature. Some countries accustomed to various types of development aid still do not understand how infrastructure projects are financed. Third, local laws and regulations as well as infrastructure policies are likely to change with the political environment causing discontinuities or insufficient monitoring.

Continued....

Hi atg,

.."China could score "wins" here in multiple mining commodities..."

Swap potash for iron ore with Brazil, for instance...oh, wait....;->

ATB

Hi TCF,

From memory, ZIOC has to report its 31 Dec numbers within 6 months. On past form , they'll likely release these at the end of June...A quick runthrough of past RNS's tends to confirm this.

Apart from something material re COIDIC cropping up before that , the next 'hard' date is early July, when the IMF is due to decide whether to agree to/support RoC's debt restructuring.

HTH and ATB

Hi allthatguff,

..'alea jacta est....' which - from my early reading of Asterix the Gaul - I remember means literally 'the die (ie dice) is cast' and metaphorically, 'passing a point of no return'.

The difficulty I have is that I can see the tumbler being shaken...and maybe even the dice in mid-air....but I don't think it's landed yet, much less come to a stop...;->

ATB

Hi allthatguff,

Agree the principle, but we're 2-3 years away from production, so it will be a while before Zanaga would change the 'actualite'....altho' it would be helpful having Zanaga 'in the bag' if the Chinese wanted to show early doors (some of) their cards..

ATB

Hi Careful,

Last post Thurs 17:17. If you go there and click on his name, you get a list of his prev posts, most recent re CMD. See Weds 1820 for a flavour.

HTH