Well connected1 Feb 2022 08:45
We talked about Eurasia Mining last week. I promised to keep you updated on the latest news from this company.
As we expected, the company has published the results of a JORC audit by international technical auditor Wardell Armstrong for its nickel tubing asset. From the report: ore resources – 107 million tons, nickel resources exceeded 300 thousand tons. Significant copper and PGM resources were also mentioned. Wardell Armstrong called CNT a first-class asset (Tier-1), NPV $1.2-1.7 billion.
Follow the link to the release on the London Stock Exchange website, which also includes a link to the Wardell Armstrong auditors ' report on JORC.
What can I say? This is a good result, as NPV of $1.2-1.7 billion is just one asset of the company with resources of 11.3 million ounces of platinum equivalent, which is about 10% of the total resources of Eurasia Mining, taking into account the joint venture with Rosgeo (104.6 million ounces).
Does this mean that the entire company should be worth $12-17 billion proportionally? Of course not. The relationship here is non-linear, but the upside compared to the current capitalization of $855 million, as we see it, is taking place. And this upside can be very emotional under certain circumstances.
By the way, in the week since our last note, the stock has grown by almost 8%. And this is in a falling market.
Meanwhile, the price wars for nickel assets are in full swing: Wyloo made another offer of $500 million for Noront this week (for reference: Noront resources are 5 times smaller than CNT). Wyloo is the company of Andrew Forest, who sits on $22 billion in cash and is actively interested in nickel assets. By the way, Andrew Forest opened an office in Russia and spoke at the St. Petersburg Economic Forum this summer, where he announced big plans for Russia. However, it is unlikely that he will buy Norilsk Nickel??
The main asset of Eurasia Mining is platinum. In the event of a surge in prices for precious metals (we have already discussed the likelihood of such a development this morning), I believe that interest in platinum may also increase. However, in the current conditions, platinum is more industrial than precious metal. But still…
Despite certain risks, the EUA theme.L can be quite interesting. However, you can decide for yourself. I have no right to give advice publicly."
BitKogan 17/12/2021
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