on a more positive note8 Mar 2023 16:37
Hi all, I completely understand all the doom and gloom here. There have been so many false dawns etc. The PEPR's at LCCM have been a bit of a carry-on, Cobre is just about keeping the lights on and Redmoor is in tortoise mode.
That said, back in Sept 2022 RAB capital took a 4% stake at around these prices. That was the RNS with William Philip Richards / Eagles Trust Limited.
Around this time last year I asked about LCCM, funding and in particular that a convertible loan was being discussed. From experience - convertibles are dreadful for shareholders and are 'death spiral financing' with conversions at 30-day VWAP etc that destroy a share price.
However - John Peters confirmed that the convertible was into LCCM project only, not into the parent company (SML) itself. I was somewhat reassured by that.
I asked this week again to John Peters about the PEPR sequencing at LCCM. He gave me a decent explanation as to how we got to here.
The last RNS gives a decent rundown but in brief he explained:
The 2 JORC deposits are at Paltridge North (PN) and Lynda/Lorna Doone (LLD).
PN is 500 metres from the existing plant, while LLD is 70km away.
We have a mining licence at Mountain of Light, where that existing plant is.
The plan is to access PN first, then relocate/replicate the same at LLD.
Seems like an OK plan. At PN the deposit is (from the last RNS):
• Layer of waste material to be removed. Anticipated 6 weeks mining.
• A layer of copper oxide material. Anticipated 12 months mining.
• Descending into transitional sulphide ore.
We must apply for a PEPR for each deposit to be mined.
For PN that means - one for the copper oxides near surface, one for the transitional sulphides.
We got the PEPR after the ridiculous covid delays and thought that was it. Let's start.
Now we're applying for the PEPR for the transitional sulphides that we'll only hit after 13-14 months.
Now, although John tells me that financing isn't conditional on getting the PEPR for the sulphides, if you were a prospective investor you probably wouldn't be in a rush to commit finance to something until that was lined up.
Now, given that the 1st PEPR for oxides took an inordinate amount of time, you'd be even keener to see that approval before going ahead. Especially as that stage is reached after 12 months and the last PEPR took longer than that.
In theory though, that delay was exceptional and we're back to the normal 3 months timeframe for a PEPR decision from DEM.
So yes, doom, gloom and delays. But isn't there some optimism that our PEPR submission for the sulphide's was in end of December. 3 months on - takes us to end of March. We would expect a DEM decision on PEPR clearance by end of the month. At that point - there is nothing standing in the way of LCCM finally getting funding.
Anyone agree? What do you think?