More than relevant - apologies for reposting21 Jan 2022 13:31
Via GMF research channel
We get a lot of questions about Eurasia Mining (EUA.L).
The topic is especially relevant after the sharp rise in prices for nickel and platinum in recent days.
Recall that according to the results of the JORC audit, Eurasia Mining can be considered a nickel company rather than a platinum one. We wrote about it, and last week the company confirmed that nickel has become the main metal in its basket.
Why is it good? The market loves trendy themes, and the “battery fever” is a clear confirmation of this. Manufacturers of electric vehicles are experiencing serious shortages of lithium and nickel, and are struggling to ensure the reliability of supply.
Last week, Tesla entered into a deal with the Canadian company Talon Metals to supply 75,000 tons of nickel concentrate from the Tamarack mine in Minnesota. At the same time, production according to the plan will begin only in 2026. This isn't Tesla's first nickel deal, and it probably won't be the last. Since new serious projects in nickel are not so easy to find, Elon Musk is thinking about future nickel mining on asteroids.
We will not undertake to judge asteroids, but everything that is closer sells like hot cakes. We have already written about Sibanye Stillwater's purchase of the Brazilian Santa Rita field for $1 billion plus 5% royalties. As well as the fact that this project is similar in size and structure to the Eurasia Mining tubing project.
Activity is high not only on already operating nickel projects, but also on those that are only in their infancy. BHP bought a stake in Kabanga in Tanzania based on a project valuation of $658 million. It is difficult to compare with NKT because Kabanga does not have a JORC audit. But what is important here is the order of amounts in which nickel projects are currently being valued.
For example, the market capitalization of the Australian Chalice Mining, which is slightly larger than tubing, but will not start mining soon, more than $2 billion. than for $500 million. A project about 5 times smaller than the NKT, to which a road still needs to be built by 2026 for $1.6 billion.
Against the backdrop of such excitement and such assessments, the capitalization of Eurasia Mining definitely looks underestimated. Moreover, tubing is not the only project of the company.
It is no secret that the main shareholders of the company are negotiating the sale of a controlling stake. Based on the project valuations above, there is reason to believe that as a result of these negotiations, Eurasia Mining could be valued significantly more than the market is currently valuing it.
It is obvious that geopolitical risks can also take place. But they are unlikely to become decisive in the case of Eurasia Mining. We continue to monitor developments.
#metals #nickel #platinum
@bitkogan "
Link -https://research.powerof78.com/post/bitkogan-article-21122-12247823?pid=1331673202#post1331673202
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