Member Info for extrader

Some comments from elsewhere :

Hopefully Plunkett's arrival will bring a bit of focus/discipline to the Board and its grip on SRT's finances.

As to the PB, my understanding is that :

- SRT is required to post a bond for $21.4m (ie 10% of contract value....hmmm, I'm more familiar with 5%...) as surety for its ability to 'perform' (duh!) its contractual obligations ie delivery of specified kit that works as described;

- it's evidence for the client that SRT's bankers believe it'll be around long enough to fulfil its contract obligations, including maintenance. It would be interesting to know the duration of the PB...and how it phases out as the contract progresses/completes).

- SRT's bankers aren't willing to post such a bond without 100% cash margin (make of that what you will), so SRT has got a bridging loan in cash from OI that SRT will in turn place with its bank, which will then issue the [cash collateralized] PB, which is sure to be a Condition Precedent for contract signature.

- with the Contract signed, SRT's bankers will/should release the 100% cash collateral they hold (which SRT will then return to OI) in exchange for an equivalent (substitute)guarantee from OI in favour of the bank.*

* This tells you something about SRT's still parlous state with its banker, even after securing the Contract.

It also pre-supposes OI's own credit-worthiness, of course, and will come at a cost.

- SRT will use the proceeds of the placing + other cash inflows (Indonesia? Kuwaiti / Phillipine/ Saudi invoicing and 'revenue milestones') plus other support (UKEF facility AND £7m proceeds of OI 20m warrants) to convince its bankers to release OI from its guarantee obligations to the bank within 6 months.

- OI gets 20m shares in SRT at a discount and - if there's any slippage (surely not!) beyond that - the chance to tighten its grip on the Company. Not quite a CLN situation, but maybe rhyming somewhat.

The mid-morning announcement and 'cash is king' solution speak to the urgency of the situation....and the 31st October deadline.

I'm sure they were burning the lights over the weekend...in MSN and elsewhere!

All AIUI

GLA and ATB

It maybe just recognizes that ZIOC won't be producing for several years, even if it's green-lit now.

Vale's interest in the Gulf AIUI has been to find customers (a) for its technology/engineering skills and (b) for its own Brazil ore.

That's clear from the 3 x 'megahub' MoU's....it's interesting that today's Oman news re Jinan shows that it's finding it easier - for whatever reason - to do business there.

If that requires it to (c) handhold others on an investment in Africa, it'll probably be happy to do so, in view of (a) and other relationship considerations eg PIF's stake in its Base Metals spin-off.

All AFAICS. Other views , as ever, welcome.

GLA

Hi Jiving,

The Oman J/V demarche (hat tip MM) is intriguing :

(1) Is it the Chinese - 2 x recently pipped to the post by Saudi and UAE re Zambian copper - flexing a bit of muscle ?

It's hard to find anything on Jinan itself, it appears - along with Rizhao - to be part of Shandong Group, see https://en.wikipedia.org/wiki/Shandong_Steel#History .

Shandong was previously in Sierra Leone's Tonkolili

(2) What does it say for the quality/extent of Gulf co-operation with Vale on Saudi/UAE 'green megahubs' and impact - if any - on prospects for a joint consortium for ZIOC ?

I'd love to be a fly on the wall at Wilt / Pimenta's (Maaden/ Vale) coffee break in Riyadh later this week!

(3) Is the recent Aramco/PIF/BaoWu steel project postponement because of Chinese reluctance to stump up cash or (maybe) Saudi dithering ?

(4) Is everything on hold until after the US elections ?

I'm reminded that the phrase 'to kowtow' has its origins in China :

"Kowtow is a word that derives from the Chinese 'kētóu', which means to knock the head. The word refers to the Chinese practice of touching one's forehead to the ground in an expression of deep respect and utter submission"

Onwards and upwards!

ATB

..". Trashing a company's prospects on a public forum impacts the investments prospects of all holders[TRADERS] It lowers expectations and discourages further investment[TRADING]. These have negative feedback loops galore. Doing so is selfish, stupid, ignorant and disrespectful to other holders[TRADERS]"

There. Fixed that for you.

Comment on public fora may affect the price at which investors/traders buy from or sell to OTHER TRADERS/INVESTORS.

If you're buying from Shard, your money goes to ZIOC and benefits the Company (and, by extension, all holders) IN ANY OTHER CASE it benefits another trader/seller.

HTH

Some belated thoughts on MK's options in particular and the o/s options/recently crystallised packages generally :

(1) There don't appear to be that many options o/s (E& OE). Apart from MK's 1.5m exerciseable at 0.01p, the others extant appear to be :

- the GLEN-appointed Country Manager, who got 3 million Oct 2023, exerciseable @ 7.5p; and

- an unnamed consultant, who has had 1.6 million, since 2014, exerciseable @ 18p.

(2) Most similar instruments - deferred compensation, LTIP and retention fees ('golden handcuffs') - were crystallised in Oct 2023 ie post acquisition 2022 and may give some clue as to management thinking/expectations at the time. These are :

- Deferred : the management team (3?) and BoD (3) took 5.8m and 5.3m respectively @5.29p, covering 5 years' deferred compensation of £ 1.7million (£ 340K p.a. or £60K pa each - reasonable ?) that was discounted to £ 600K (or £20K pa each).

One wonders why they agreed the discount ? (a) perhaps dilution by a greater amount would 'upset' the 'balance-of-power' with GLEN ; and/or (b) they expected (in the not-too-distant future) to be able to monetise at a significant multiple, sufficient to make the end amount 'enough'.

-LTIP - deferred bonus for management (3?) of 13.6m shares also @5.29p, for £ 720K, covering 4 years since 2019, say £ 180K pa or £ 60K each. A 'reasonable' bonus ?

- Retention fee arrangement - again, for 3 (?) key staff : 2.8m shares @ 5.29p = £ 140K, also covering 4 years, so £35Kpa or £10+K per person. Hardly 'golden' handcuffs, maybe more 'pig iron'.

(3) What everybody gets (so far) :

The BoD we're told :

- Elphick 2.2m, total 82.5m

- Dines 1.5m, total 2.1m

- Velloza 1.6m, total 1.85m

Assuming that there are 3, acting as consultants and all paid equally, we'd have

- Colin Harris, mining/technical consultant;

-Andrew Trahar, business development/PR;

- Gary Vallerius, Chief financial officer

each picking up (1.75m + 4.5m + 0.9m =) about 7.15m shares for the last 4 years, plus whatever they collected (if anything, any ideas?) in earlier years.

(4) How do these numbers compare :

- MK 1.5m shares for 18 months' fulltime work;

- CM 3.0m shares for 10 years' work;

- Harris, Trahar and Vallerius 7.15m+ for 4 to 10 years' work;

- the Board : about 2m apiece.

I'm out of touch with current conditions, but I'd think compensation based on 100p to 200p per share (+ maybe some further 'success fee' at the end) would be in the ballpark.

And all this to end up where beardozer got in a few minutes....

Ho hum.

As ever : Comments/corrections/clarifications and objections invited !

GLA and ATB

You seem to be hinting - yet again - that you have some kind of 'inside track' to what's happening.

Unfortunately, the track's not led anywhere ....so far.

However, there's a first time for everything..and meanwhile the 'musings' are often interesting and thought-provoking.

Pray continue.

Hat tip kukidoh

.."An interesting ten days ahead for Burford: announcing Q3 results presumably this week; Sundance resources settlement with the Congo update due end Oct after the rollover at the end of Sept; US DOJ Nov 6th deadline for input to the YPF shares turnover motion…"

Reply :

.."There's also the small (related) matter of the outcome of the US election : it appears that Trump, Musk et al are more likely to do business with a country and a politician that takes its obligations seriously.....which would give it the wherewithal to meet those obligations....

Two shorthand characterisations of delinquent borrowers from my banking days:

(1) 'Honest, but unfortunate'; and

(2) 'Can't pay'...or 'won't pay'?

Jes' sayin'."

GLA

Classic GIGO, I'm afraid : a google search will show you that Macquarie has very limited exposure to greenfield anything (in Africa so far limited to renewables) and its preferred area of business is regulated utilities, toll-roads and the like infrastructure where it can deploy sophisticated (= 'cute') financial engineering in 'rule-of-law' countries that use PFI and similar to confuse the electorate.

I just don't see the cheque-writers from the various potential Strategic Partners that we're speculating about being culturally or professionally interested in anything Macquarie might have to offer, myself....and Elphick and co would have to be pretty desperate to turn to them.

I appreciate - as I'm sure we all do - your 'thinking outside the box' (and some of the ChatGPT insights/perspectives).

That doesn't mean that we have to accept uncritically or can't have a different opinion.

After all, that's what makes a market ...and provides opportunity.

HTH and ATB

Hi MM

In case unaware, Macquarie has a bad rep as innovative financier : google Macquarie Thames Water controversy ( though shysters got me there also).

Seriously, you don't want them anywhere near Zioc.

HTH

Hi Mitch984,

Thanks for engaging...and I assure you that you're not alone in your concern at the recent s/p movement.

'Money on the move is information' as John Reed, I think it was, once said. Summat's up, for sure, but what? Nature abhors a vacuum, so it's natural to seek an explanation. I think various are possible here - and I've given mine FWLIW as a point of view.

There are a number of points I could raise re your thesis, perhaps it's safest just to stick to one as it's a fairly objective one : your statement that GLEN is dominant because it has 'distribution rights' that are discouraging participation of other potential mining co's.

Surely that would have become obvious from the get-go?

My reading is that it doesn't in fact have such rights - and even if it did, there's wiggle-room.

What it has is laid out in the 23 November 2022 Acquisition RNS :

.." Life-of-mine MARKETING agreement granting Glencore INTERNATIONAL the exclusive marketing right for all iron ore conforming to certain specifications produced by MPD, ZIOC or their respective Affiliates from the Project or in the Republic of Congo using similar infrastructure that is not subject to existing sales arrangements.

o AGREEMENT by Glencore PROJECTS [ZIOC shareholder] to PURCHASE from MPD or the Company the Product, OR SELL the Product on behalf of the Company ON ARM'S LENGTH TERMS.

o Glencore INTERNATIONAL to be entitled to receive a MARKETING fee in accordance with the detailed provisions of the Marketing Agreement..."etc

The devil's in the detail, of course, but even the fuller description later in the RNS doesn't suggest to me much more than that :

(1)'International' (the trading arm) will go out and seek buyers for the Product (for a fee); and

(2)'Project' is willing ('agrees', but isn't obligated or committed) to buy the Product (presumably for /on behalf of International) and is also willing to on-sell the Product, in either case (or both cases, it's ambiguous) on arm's length terms ie no collusion between buyer and seller.

Even the 'loose offtake' agreement is subsequently qualified by flexibility in quantum eg, "International has agreed to purchase all OR PART of the Product.." which I take to be anticipating/providing for an eventual pro-rata distribution of Product amongst eligible Strategic Partners.

So (1) I'm not sure how much of a disincentive there is in practice and (2) even if there had/has been pushback from a Strategic, it would be relatively straightforward to 'tweak' the Marketing and Buy/Sell rights to get a deal over the line.

But that's consistent with my long-held view that GLEN's put things into the agreement that - for the right price - it's willing to give up.

Where I accept that , to paraphrase, ' views may vary'.

ATB and GLA

I don't think it's stated anywhere that

.."Nice 1m chunk buy at the death!!!!.."

Maybe that's some smart alec hedging the 1 m dilution that will happen when MK's option vests next week.....

Well, you started it!

;->

Hi beardozer,

.."extrader: are you Clifford Elphick in disguise?

All the rubbish posted between you and MinorMiner has been a complete waste of your time."

Everything's relative : you've no idea how I 'waste' the rest of my time!

A moment's thought (I know, I know) would tell you that that (ie implied pump/boosterism) was unlikely . At least on my/Elphick's part; I can't and don't speak for MM.

It's only in Elphick's interest to talk the shareprice UP if there's no deal afoot (so that he gets more cash in for any Shard-driven dilution and can keep the lights on longer, while he waits for something positive to happen);

Remember, ZIOC can instruct Shard to suspend sales at any time, so any Shard sales at these levels that might be contributing to s/p weakness have its / Elphick's (implied) blessing :

.."The Company would have the right to require that SMC cease to make (or procuring) sales of Subscription Shares under any Tranche for such time as the Company determines.."

Cui bono?

Conversely - if there IS anything afoot - it would be in Elphick's interest, if anything, to talk / walk the price DOWN and ease out ('voluntarily') as many 'unsticky' PI's as possible, helping move their shares into more 'predictable' hands.

Note in this context the Unsold Shares Buy-Back provisions on termination of the 2024 ESA, which ZIOC can invoke at any time.

Jiving has just wondered about those hands being a Strategic, I've wondered (when I'm not wearing my Elphick hat) in the past whether they would be Elphick's original fellow-promoters.....

I think Elphick (when he's not wearing my hat, of course) is 'saying it best, when he says nothing at all'.

;->

Having railed so long about the risks of 'confirmation bias', I'm aware of course that the above interpretation of what's going on may have an even shorter shelf-life than MK's options....

Have a great weekend, one and all.

ATB

Last 2 x depeches :

(Thurs) : Russian ambassador re-states oil pipeline commitment :

.."With regard to the project to build the Pointe-Noire Brazzaville-Oyo oil pipeline, the Council of Ministers approved the start of construction work, 90% of which is to be carried out by the Russian pipeline manufacturer ZNGS Prometey and 10% by Société nationale des pétroles du Congo.

The infrastructure is supposed to link Pointe-Noire, a port city, and an oil industry hub in the capital Brazzaville before reaching Oyo, [Big Den's homeland] in the Cuvette department. ‘I'm not hiding our vision. We would like to see the Congo become a hub for the whole of Central Africa in terms of the supply of oil products, gas and electricity. Completion of the pipeline would ensure the availability of petroleum products throughout the country AT A TIME OF RECURRING FUEL SHORTAGES AT THE PUMPS [Ed.: for non-payment]. The concession agreement should specify the technical and financial aspects for the construction, operation and transfer of the infrastructure. Russian companies HAVE BEEN CONTRACTED (?) to build the hydroelectric DAMS (?), and to deploy tracked bulldozers and pipe-layers for the construction of roads, hydraulic works and civil construction materials..."

(Fri)

- Talk re Japanese stepping up investment in Africa. Mostly DRC mines, rare earths...

- Big Den talks at BRICS about a new world order / payments system, segues somehow into suggesting payments (to C-B, himself) for safe-guarding the planet with its forests..

-[Ed.: of far greater significance IMO is that HSBC, no less, has signed up to CIPS - the renminbi alternative to the $ SWIFT payments system.

https://www.zawya.com/en/business/banking-and-insurance/hsbc-joins-chinas-payment-system-in-boost-to-yuan-usage-qc1s14e]

-for Eddsy / 4kandles : Local footie dispute takes it to the wire...goes into extra time

.."Fifa also invited the ad hoc‘Commission .. to comply without delay with the directives, which included returning full possession of the headquarters, the Ignié technical centre and the Fécofoot facilities to the Fécofoot executive committee ; abandon any attempt to change the signatories of the Fécofoot bank accounts and/or return the accounts to the full control of the signatories known to Fifa and CAF, stating that the use of funds made available by Fifa and CAF is strictly regulated.

Fifa clarified that if it did not receive confirmation from Fécofoot's General Secretary within a week that the above directives had been implemented, it would be obliged to submit Congo's case to the Fifa Council. The Executive Committee notes that the ‘ad hoc committee’ is intent on persisting with an illegal, unjustified and irresponsible approach that would isolate our football from the rest of the world’, states the press release..."

And so it goes...

GLA and ATB

.."where they have stated $28 billion of deals/partnerships will be announced..."

......and where '1,000,000 of the shares [MK's options] would vest and become capable of exercise on 1 November 2024'.

The award is explained/justified as follows :

.."Marty has played an instrumental role in delivering an update cost estimate for the Zanaga Project and advancing progress with potential Strategic Investors. The ZIOC Board has unanimously agreed to the granting of share options and is DELIGHTED with Marty's efforts to date, and expect to see his efforts delivering MEANINGFUL OUTCOMES in due course."

Why would Elphick give this seemingly gratuitous, time-limited hostage to fortune ?

Hmm....

Perhaps somewhat timeous ?

FT Headline today

Indonesia says it drove Chinese coastguard ships out of disputed waters

Beijing’s sweeping maritime claims and muscular enforcement actions have been creating friction in South China Sea

Let's hope it helps people focus !

GLA

Meanwhile, competing date-wise with FII Riyadh, I see that the FT has its own show :

https://africa.live.ft.com/page/3130270/speakers

With attendees including Angola's Secretary of State for Land Transport, the US State Dept for Global Infrastructure, folk from the World Bank and its offshoot MIGA, Ruto of Kenya and various African development banks, the Pres of Ivanhoe Mines and the head of Strategic Investments at Trafigura, this looks like an opportunity to grandstand the Lobito corridor...

'Africa' seems to be flavour of the month !

GLA

Thanks for this, MM - an endorsement of the thesis that Twiggy's interest in Belinga (and possibly ZIOC) was as admixture to his own 'Pilbara rust' assets.

The article hints at the very real domestic political difficulties that ANY Aussie miner will face if it ignores its domestic constituencies. Hence the euphemistic ref to Simandou as a 'complement' to its existing W Aus and Canada sources.

A quick google , meanwhile, of 'RTZ and Saudi Arabia' - after 'BHP and Saudi Arabia' elicited little of interest *, brought up this interesting comment, in an article 6 months back about RTZ and Manara being in the running for the First Quantum mine ...

* our man Clinton Dines, of course, made his name as intermediary between BHP and the Chinese....

https://www.miningweekly.com/article/rio-saudi-arabia-said-to-vie-for-stake-in-first-quantum-mines-2024-04-18

Manara recently pipped both RTZ and the Chinese bidders to the prize.

Referring to both, the article included :

.." For Saudi Arabia, the deal would be another major coup following its purchase of a stake in Vale SA’s base metals unit for $2.6 billion. The kingdom is looking to secure supplies of METALS for its industrial ambitions as it attempts to diversify its economy away from oil.

Rio, the world’s second-largest mining company, is GENERALLY RELUCTANT TO BE A NON-OPERATOR and has also avoided the CENTRAL Africa region [ Ed.: but not Simandou...]The company’s copper head said at a recent conference that he sees MUCH MORE VALUE IN BUILDING MINES RATHER THAN BUYING EXISTING ASSETS. .."

More permutations, maybe ?

;->

ATB

.

The FT article has 2 x good write-ups on the potential for (a) copper (cf Chile potential); and (b) shale oil at Vaca Muerta.

In both cases, experts praise Milei for steps taken so far, but says 'legal clarity' is an important precondition for significant investment....

Milei, pls note!

Incidentally, article also suggests that the lithium hype may be just that, somewhat over-rated in significance.

Don't tell Musk - or Trump- that....

GLA

Https://fii-institute.org/conference/fii8/

Only 2 bits that may be relevant, afaics :

Day 0 Mon 28 October : various seminars on AFRICA : investment, infrastructure, energy, supply chain logistics and public-private partnerships, with some familiar names (alas, not incl Little Den).

Day 2 Weds Oct 30th :

Future of resources: are clean industries achievable?

Industries are challenged to adopt cleaner technologies while ensuring a reliable and fair supply of critical minerals as the world aims for a more sustainable future. In 2023, the demand for these minerals increased due to the use of clean energy technologies, with electric vehicles using the most lithium and cobalt, according to the international energy agency. Can this change happen responsibly, ensuring these essential resources are

managed sustainably?

speakers:

• abdulrahman al-***eeh, ceo & executive member of the board of directors, sabic

• ana cabral-gardner, co-chairperson & ceo, sigma lithium

• robert friedland, founder & executive co-chairman, ivanhoe mines

• Gustavo Pimenta, CEO, VALE

. Robert Wilt, CEO, Ma'aden

Maybe the last two will have other things to talk about during the coffee break ?

GLA and ATB

https://fii-institute.org/conference/fii8/

only 2 bits that may be relevant, afaics :

day 0 mon 28 october : various seminars on africa : investment, infrastructure, energy, supply chain logistics and public-private partnerships, with some familiar names (alas, not incl little den).

day 2 weds oct 30th :

future of resources: are clean industries achievable?

(30 mins)

industries are challenged to adopt cleaner technologies while ensuring a reliable and fair supply of critical minerals as the world aims for a more sustainable future. in 2023, the demand for these minerals increased due to the use of clean energy technologies, with electric vehicles using the most lithium and cobalt, according to the international energy agency. can this change happen responsibly, ensuring these essential resources are

managed sustainably?

speakers:

• abdulrahman al-***eeh, ceo & executive member of the board of directors, sabic

• ana cabral-gardner, co-chairperson & ceo, sigma lithium

• robert friedland, founder & executive co-chairman, ivanhoe mines

• gustavo pimenta, ceo, vale

. robert wilt, ceo, ma'aden

maybe the last two will have other things to talk about during the coffee break ?

gla and atb