Member Info for Fortissimo

Last week saw Assembly sorted and that bodes well as Perez and his crew now reduced to very little influence. Correa and Noboa pretty much control Assembly now... but clear that Correa want out right rule. He'll have to wait 18months + for second bite at cherry. If Noboa makes an impact over next 18months... correa could be history.

QUITO, Nov 17 (Reuters) - Ecuador's National Assembly chose a conservative as its president on Friday as the new legislative period began, amid a deal between the parties of President-elect Daniel Noboa and ex-President Rafael Correa to form a majority.

Businessman Henry Kronfle, 51, was elected with 128 votes from the legislature's 137 members. Nine abstained.

The legislature was dissolved in May by outgoing President Guillermo Lasso to avoid his own likely impeachment, bringing forward legislative and presidential elections scheduled for 2025.

PFC's previous financial woes didn't upset those that awarded the TenneT deal. Question is... what would happen to TenneT deal if PFC failed to negotiate on bank debt due repayment in 2024.

I think the concern near term is that the shorters are not closing out at these levels.

They are either 100% confident or risking more than necessary now. Most would happily close out and take a very decent profit based on shorting from 60p levels if not higher. Some got burnt on the TenneT deal so you'd think they would be more cautious. Instead... they are adding more and more shorts in mid 30's? Madness.

What's more mad... is the company silence. What are PFC board thinking? Are they worried that if they do an RNS to clarify the position then it will make things worse? I guess is in bank talks, they can't say anything until talks concluded.

At this rate, it's going to be hard to hold on to the 30's if the shorters just keep going and PFC are 4 weeks off their TA.

Norges, Vanguard and Blackrock are the funds that could do some damage with heavy handed selling. Being non uk based none would need to issue TR1's as they are sub 5%.

This spanks of 'bank discussions' and the insider trading / leak is terrible to witenss if true. FCA will need to look at this if it reveals that discussions did indeed start when the SP topped off.

Logic would suggest that management tend to open talks on these financial issues when the sp is strong and business looks in recovery. Hence, when sp was 85P+ that would have been prime time to kick off discussions. Did someone get wind of it and then shorters descended?

It will come in wash sooner rather than later but for now, shorters are just adding more and more weights to their shorts and that's at these 35p/36p levels which suggests they are going for more or trying to suppress to level which allows them an exit without spiking past 50p.

The daily volumes are not really in the realm of TR1's.. 3 or 4 million traded does wonders for the shorters in a poor liquid market but the truth is the big holders like Schroders and Azvalor have 125m shares between them. They don't appear to be selling.

The way this is going, I wonder whether Asfari is planning to take the business back into private hands? Tut tut!

If BHP wanted to prevent SOLG being sold of a monetisation event, they would simply counter offer. If it looked like their remeaining 10% was going to be the 'last man standing' % then the writing would be on the wall. I suspect they would also need sounding out before any such deal. So I don't think it an issue. And FWIIW... I really don't think BHP are that bothered about SOLG these days. I think at some point they were undecided between buying SOLG and OZ Minerals and they went with the latter.

rcgl... good point on the 157m shares. I've got 'share issuance' in the head as being dilutive! But as you say... these shares are already issued.

At 10p a share, they could buy SOLG another 6months ish but more likely 4 months. At 18p, they could see 9 to 12 months.

So pinning SOLG down in the sub 10's really is like a putting a heavy boot on the back of someone already down on the floor. Suits someone?

Addicknt,

they have 157m shares available to issue. That would drop BHP to 9.5% level. So not an issue.

"So I expect an IRR much closer to 30% when the PFS is published, maybe as early as January. "

red... they haven't even handed the data over to a 3rd party yet to have it scrutinised and approved. So you've got zero chance of January. You'll be lucky to see a new PFS before Easter 2024.

Thanks Mog... so they've moved it back lol! It was cited for Dec 13th only a few weeks ago.

They clearly need more time for something! Slightly concerning but also slightly positive one hopes.

Not sure what they've gained by buying an extra week lol.

The 21 days notice of AGM is required today based on the mentioned date of Dec 13th. I always thought that Scott and Bob would be issuing a bullish news update before allowing shareholders to vote. But doesn't look that way at the moment. Looks like they are limping into the AGM and zero to offer.

In terms of BHp and the old NCM now NM... in the past we less influence on the book and they had more influence. eg 26%+ for then Mather on the opposite side along with 7% CGP etc and ironically the latter were voting with BHP and co against Mather.

So now we have Maxit, Mather and CGP guys with increased position and BHP and NewMont dropping by 6% not to mention Blackrock being at near zero hence that's another 5% gone that would normally be against.

So all in all... very much different now. So I wouldn't be giving these CGP boys an inch of freedom. Zilch. I'll be voting them all down unless they pitch up with a reason for me to vote for them.

It's possible that the TenneT deal may have caused cash flow issues or for them to fly close to the covenants. The trouble with PFC at present is that no one really knows which contracts are lagging on the book and which are being payed promptly. Furthermore, there is around $200m (I believe) that is ring fenced to other projects. I think they had around $200m clear headroom afte Dec 31st 2022 numbers relased in April. It only takes some smaler $40m project payments to slow or miss dates and then they are into another $200m hole (like last year). That would virtually take them up their limits. So banks might be willing to extend bank facilities again by $100m, but might want or force PFC to raise equivalent from market via equity placing. If done at 35p, then that's 300m more shares to be issued and that would dilute many holders.

It might just be a case of some cash flow issues which sort themselves out in 2024 but banks being banks... will still want pound of flesh for taking the risk and extending.

Doesn't feel like a D4E scenario but there is a decent $200m + due for repayment in H2 2024.

Only other issue is the private equity firms taking them to court over SFO debacle. Never thought that had legs at all but you never know these days. First for everything.

No sure on the complexity of mine in Botswana vs Alpala (Block Cave) but any industry 'transaction' like this gives a pretty decent read across fellow resources and assets. Even if you discounted Alpala heavily due to block cave technicalities... you could justify £1 per share and that doesn't include the other 60 odd licence blocks in the folio.

Most brokers have retained price targets of near 70p a share so that correlates with about £2.1bln or $2.6bln on exc.

I guess the question or issue come s down to what discount you apply for blockcave.

Rio are spending close top $7bln on Oyu Tolgoi in gobi desert and if I recall they were looking at extracting about half of what Alpala has.

Haven't see recent number on OT as imagine they have risen with inflation.

Originally, Oyu Tolgoi was expected to cost about $4bln. Alot has been learned by Rio's mistakes and more recently OZ Minerals and BHP are defining the new path to lower risk less capital intensive mining whcih we know Scott and Bob are now following in their footsteps ... oh the irony!

I think it's fair to say that market regs deem that if an SP surges more than 50%+ then company must state if they know of a reason or not for teh rise. Helps keep orderly markets etc. The converse should also apply. A drop from 87p to nearly 37p without a word from the company suggests they cannot argue with the market.

The scheduled trading update is not due until Dec 21st or 22nd I believe but in light of the share price fall, there's no reason why they couldn't do a pre-trading update stating that they are on track as prevously guided.

My guess is that they are going to 'miss' the cashflow positive or neutral goal they set out earlier in the year. Legacy contracts were due to complete in early 2024 but may well have been kicked into H2 2024 is that helps with accounts. Something not right here and that was signalled by the 21/26 bond collapse from 80's to low 40's. Coincidence or not... the falls kicked in when MENA region issues kicked off.

The shorters are ramping positions up at these low levels rather than reducing and that is unusual. They seem very confident. But they got it wrong with Tenet. So could get it wrong again?

Not very positive on the bonds

Never seen them so low. Now 47 value on bid.

Someone has sold heavily over last few weeks. It's as if they see no value in holding them any more which is weird as they pay 9.75% per year. Not due for repayment until 2026.

Weird... but selling the equity could be part of a hedge plan or arbitrage on bonds as mentioned before.

DBW, true but I've never seen that happen before ever. Normally when a CEO is voted out at an AGM he walks. That said, he could just drop down to being an operational man etc which lets face it... that's all he is or was really.

He's not CEO material that's for sure.

All he needs to do is deliver something to shareholders that justifies their vote for him and the $70m+ he's chucked down the toilet.

Unless he's won over BHP, I think he's toast. But still time to win some shareholders over who have been utterly disappointed with the business and mothballing of exploration for almost 18months now.

We are either an Explorer or a developer... not both.

If he announces a spin off of exploration folio and new shares in that etc etc and then leave ENSA as it is... I'll vote for him. That's proper management in action. Allows entire set of new investors in... allows exploration to flow. Allows this interested in ENSA to have confidence that the wider business is not a drain on resources.

Not hard is it?

Due this week... so should see what resolutions are being presented and what if any command a 'special meeting'.

Tick tock Scott... get your bags packed ready.

Could this be the a sign that Lasso's team are finally putting pen to paper in their last week in power?

Prior to recent elections, Lasso's ability (or anyones for that matter) was hindered by Perez (eco warrior) who had loads of seats in the assembly and thus pushed for eco issues or held back pro mining. With Noboa in, the assembly has changed significantly, with Perez having almost zero in the Assembly now.

We know Noboa is pro mining. So this potentially bodes well and mining in Ecuador could be looking at a golden spell after a difficult last 3 years which has combined covid woes with Eco Perez opposition. Both issues have gone (not completely) but path clearer for business and miners now.

If you read the press release it looks very positive. The company that have issued that RNS clearly seem excited by it.

Well worth a read. Good find Ortherncopper. Nice to see you finding something positive for a change!

Jerry,

What's your average holding price on SOLG?

Jerry,

What's your average holding price on SOLG?