Member Info for Fr.Jack.Hackett

Hello,
I find it encouraging that the first gold-pour announcement was made earlier in the week and, as it was first gold pour I consider less in the quantity produced and concentrate more in the fact it has (finally) happened - but more quantity is always welcome.
Reading the latest RNS issued today - the only item that raised a small issue to me is the following statement:
'The Company commenced production at its wholly owned Homase Mine November 2021. When at full planned production of 2000oz pcm GRL expects an AISC of
The AISC of <$600 is very encouraging
The 2000oz pcm for full planned production is however a little different to my understanding - which is still based on the following earlier RNS:
RNS dated 13-May-2021 : CEO stated 'we are now able to increase our planned production rate to around 50,000 ounces of gold per annum, including 25,000 ounces in calendar year 2021'.

I am not 2 concerned about the 25k in 2021 - not achieving this may be due to operational startup issues as being commissioned - but what I have concerns is the change of planned annual production from 50k pa to now 2000oz pcm (24k oz pa).
I dont think GRL have stated this planned production goal elsewhere since the May 13 RNS - if this has been announced already then I would like reference to it to allow me to modify my financial model for the Homase Mine.
If anyone can advise - please do.

Thank you

Mac,
Its why I really think we need either specific DFS information or latest production figures (maybe we can get this from the annual accounts to be issued).
Speculation, guesstimations etc are all very good - and very welcome on such a discussion board - but I think maybe Eurasia shall find time now to reset us all just for clarity (I think this will be possible anyway via next set of accounts). As Sir Humphrey Applyby once said 'We should always tell the press freely and frankly anything that they could easily find out some other way', so I do envisage further info.
I do think WK been undergoing high-geared expansion possible already achieving mining rate at end of this season equivalent of the rate for 50% of annual target - and possible would be up to 100% target by end of 2022 mining season.
As for what daily production figures feel comfortably with - figures which would complement the above would be very comfortable.

Yes - you right - 68% not 64% - I get little twisted with the Caledonian ownership for Blanket mine.

Mr. Pk73,
Please note that ownership of WK is 64% - so don't spend all your money just yet.
But as expansion is happening quicker than I originally anticipated - WK could already be a creditable source of revenue and even more next year.
Mac mentioned a dividend associated from WK - I would suggest by end of next mining season WK could contribute to a 2 or 3% dividend based on current share price - and WK is peanuts compared to MT (& Flanks) which have target of 1000koz.
Time is what you need to reap this - and I assume you are 50 in a few years - so enjoy the time.

Looking through past threads - I read sad news concerning a very popular person on this bullet-board JTMac.
I would also like to add my thoughts to his family - and wish they well - as so many here have already.

GoBig or Go Hone,
Reviewing the information you stated - aligns very much with my earlier calculation - which is re-assuring:
170000m3@0.81g = 137.7kg over 100days = 1.37kg/day with 1 washplant, = 4.11kg with 3 washplants, = 986kg (34koz) for the season's 8 months operation.
My earlier post indicated 14koz for the last three months = 37koz per 8 month season.
When the full quantity of washplants are installed (i think 7 or 8 - but not sure) would then be in the region of the target 64koz. WK could easily reach this target next season - and if so the asset would be generating $50m EBITDA. Often some investors use rule of thumb 10-15x EBITDA for the asset valuation.
Maybe also Eurasia may make announcement to the tone of raising the target above 64koz.

Mr. Dowely,
If your reference is to my earlier post - please note the highest target production figure Eurasia have provided to my understanding is 64kozpa (ref RNS dated 1-July-20). If you have another figure - please provide reference as it may be something many have overlooked.

Mr. Mac,
The 7kg (approx 245oz !!) maximum production in a single day from WK - from the DS interview you posted earlier (I have re-attached link below). This was stated back in October 2019. I suspect though it was from a very rich grade of ore being processed at the time.
ref : https://www.youtube.com/watch?v=d_YMY6yiMDE

Eurasia stated that target production for WK to be 64kozpa - RNS dated 01-July-20.
Assume 8 months max processing of ore during on-season - that means 8koz/month average.
Understand it has been mentioned somewhere (maybe by Eurasia or maybe here on LSE) that it was considered to install 7 wash plants in total at WK (but cannot remember reference where stated - if anyone can confirm).
With the three additional washplants commissioned in late August - then it can be generally assumed that WK production from 4 washplants for the last 90 days of processing (mid Aug - mid Nov) before the season closed may achieve at least 4/7 of the expected quarterly production (of 24koz) so approx 14koz.

This is the data and assumptions I have been using - and if the ore grade is known in October 2019 to be considerably higher to sustain anything like 7kg/day per washplant then this would have been addressed by increasing the target production figure stated in the 1-July-20 RNS.
The two RNSs (21-Jan-2021 & 15-Mar-2021) unfortunately did not provide information from Eurasia that changes the target production for WK from 64kozpa.
If Eurasia could provide update on either details in the DFS or production update from end of 2021 season - then it would add clarity.
Your assumption of 21 kg/day is still a valid assumption - based on the statement 3x production increase - however I suspect it was based on average production over a certain period rather than the (maybe optimistic) highest single day production. As mentioned - clarity from the DFS or production update would be welcome.

Lovelyboy,
the Polymetal and Polyus articles you posted indicate they have now purchased a 75% stake in the company that own the asset licence - subject to exploration to firm up the reserves estimates (for the Polymetal this exploration appears to be funded (to an unspecified extent) by Polymetal, the Polyus link does not give any info on the exploration funding).

I understand Eurasia have paid USD$0.5m for the ability to have first call on the JV assets - not yet for the assets themselves. If Eurasia decide to proceed with an asset then Eurasia will pay the fair value as if auctioned - so Rosgeo will still get paid the asset value (I also understand this shall be spread over the period of the development).

In addition, I understand:
1) some of the JV assets already have resource estimates within the Russian coding (so are even further ahead than Polymetal & Polyus).
2) after the completion of reserves audit under the JORC code then Eurasia have the ability to acquire the remaining 25% from Rosgeo - but I don't know how this value of the additional 25% is to be calculated.
- I dont think Eurasia need to complete resource review under JORC coding to move forward with any of the JV assets - but it is a requirement if Eurasia want the extra 25% from Rosgeo and probably also for any interested party (especially if based/listed outside of Russia).

I suspect that the asset NPV will be more pleasing to the accountants if they can put down 100% ownership rather than 75% - so suspect Eurasia will complete JORC review and purchase the assets 100% where feasible.

Eurasia already moving forward with the Nyud JV asset so be interesting to see how this develops - and can use it as a template for any of the other JV assets moving forward.
- check the RNS dated 26-March-2021 & 15-June-2021.

If my understanding is incorrect on any of the above I hope others will correct

Surprised to see recent drops in share price - always seems strange when no information available.

I think the below link was posted earlier in the week concerning Sibanye-Stillwater purchase of mining assets from some private equity firm.
As there been little other news in last few weeks - got to use what little there is!
Total sale was about $1b for two assets.
Asset 1 : Nickle mine @ 16k tonnes/year. Nickle at $20k/tonne, asset revenue = $320m/year
Asset 2 : Copper mine @ 20k tonnes/year. Copper at $10k/tonne, asset revenue = $200m/year
Total annual revenue for both assets = $520m (bought for $1000m = approx 2x annual revenue)

Applying similar philosophy to MT/Flanks and based on 1000koz/year production:
MT/Flanks asset revenue (full production) = $2000m (based on Pd @ $2k/oz)
MT/Flanks asset value = 2x$2000m = $4000m = approx £3000
MT/Flanks asset value on share price =£3000m/2900m shares = £1.03

I know the SS mines are producing and MT/Flanks will need a few years - but its just a comparison and I am sure if the experts look into the operating costs per tonne or oz then expected MT/Flanks will be less percentage of revenue than the two SS assets (but only thought).
The above value is a little higher than I calculate with NPV - but it is using recent asset sales data.

https://www.mining.com/sibanye-stillwater-buys-nickel-copper-mines-in-brazil-for-1-billion/

(This may have already been discussed previously so apologise - as not visit here much at moment)

Mr Cool Dude,
I agree with you - but PFS, DFS, BFS etc and NPV cals based on feasibility studies for mines are few and far between - so I got to use whatever is available (I think last one was Generation Mining some months ago).
As long as you agree the data used was Newcrest PFS data and therefore is valid. I know the GGP may be using their own data.
At least EUA are commissioning the MT mining plans and feasibility studies.

Mr Cool Dude - the figures are Newcrest PFS data from the Newcrest PFS presentation issued yesterday/early today.
I pass link below. If I have typed anything in error then I am wrong - otherwise if any of the data is wrong please inform Newcrest - I am not the source of the data:

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02434244-3A577964?access_token=83ff96335c2d45a094df02a206a39ff4

In addition - Mr Long & others - I use this opportunity not to discuss GGP but to compare the MT asset directly to the Havieron asset.

Mr Magnum,
I not sure what number you are referring to - but as the only number I presented on GGP was that they owned 40% of the mine - Newcrest own 60% so assume it is this.
I am not aware if this ratio has changed yet (I know Newcrest have options to take up to 10% more I understand) but this is is yet to be announced (and at what price).

Whilst listening to Steve Allen on LBC thought it be interesting to review EUA MT mining plan v Newcrest Havieron PFS.
Based on the Havieron PFS released yesterday the following items are noticed (from the PFS):
: 160koz production (starting in 2024), AISC $743/oz, Capex $397m, NPV(4.5%) $228m.
Newcrest have now given the green light to progress to Feasibility study - I assume this decision to continue is based on future mine potential rather than based on the data from the PFS alone (Capex of $397m for asset with NPV $228m @ discounted at only 4.5% !). I am sure the geology experts at Newcrest have enough data to justify moving forward (reduce risk) - but this information I assume is not currently made formally available to investor (why). I think they have done well to get the AISC at $743, I was expecting much higher - and suspect this will reduce more if they can release more of the potential of Havieron mine (maybe Newcrest will make announcement soon to satisfy investors and justify going into feasibility study).
I understand Greatland also have a 40% ownership of Havieron - can only assume they have other projects ongoing to be able to currently maintain such a high market capital - if it is just speculation then I would suspect a fall in share price at least until additional information is released as the PFS cannot sustain that MCAP alone.
Take EUA MT mine as stated in the recent Mining Plan RNS operating at 128koz, MT mine looks much better on the economics (even without Flanks).

Even though EUA have not yet released the Flanks mining plan (due soon) - I suspect it will increase the MT throughput by 5-8x as they have already stated target production 1000koz in the RNS dated 20-July-20 .
EUA economics also include lower AISC (open pit), higher metal value/oz and EPCF package already in place (at least for 128koz) - and all still looks good even if a conservative 30% discount is applied !

Thank you Arsenalles,
I think you addressed all my items & I also suspect maybe all shall be revelled very shortly.

Hello Mr Arsenalles,
I don’t catch up much of the chat on here - but I do remember one of yours maybe last week - it was at the time when Spurs absolutely embarrassed Arsenal by letting them win by only a few goals - maybe its still being considered as a criminal act - lets see what the MET-Police decides.
Anyway - I think you stated that you had a price for the company (i think you had £1.44 - maybe it was in $ - I not sure) but you would not share your calcs - I suggest maybe you would like to re-consider sharing your calcs - as it is always interesting to see viewpoints from others.
I have already posted my valuations - not for the company in general but mainly the mining assets - all based on discounted cash flows - and generally I get an MT (incl flanks) asset worth a little higher than CAW1 provided (from a Richard D. I understand). I have been unable to attain any price for the JVs (due to obviously missing info) but I would like other views on this value as its integrated into the value of the whole company.
It be nice to know the following:
- Is your company price based on DCF for all assets - if yes then maybe a few slithers of details be interesting such as - annual production, discount applied etc
- Is it based on in ground assets value for some/all mining assets - if yes then maybe detail a few of the % of total

I understand if you don't wanna post - but if you do feel like to - then I and many others would appreciate.

The main reason I value the assets and not the company as a whole - I can put fiscal values on the mining assets (with assumptions on first revenues etc) - but I find it difficult to put a value on the JV possible assets and also the company's personnel assets - I am sure the personnel are worth more than some of the mining assets (I cannot name a major mining company which would reject the CV of any of the current EUA board).

Mac,
In your opinion is it feasible that some of Rosgeo JV - when partial ownership is transferred over to EUA & possible resource grade update/confirmation - then EUA can be in a position that the (assumed to be) MT & Flanks asset sale does not cover 75% or more of EUA's assets - and possible no requirement for EGM and vote.
- Just sale announced on RNS

roger65,
I looked at the ACF report during the weekend and made some predictions based on the limited info in the RNS mining plan. If you not doing much maybe review my postings over the weekend.
What was of interest - it is possible to calculate a modified 'AISC' based on the figures ACF have used (this cost also includes the 10% mining tax and others costs) and therefore can be used to broadly model the ACF. You can create a simplified version of their model using their figures :
From the ACF report dated 6 Sept 21 - Exhibit 1:
Modified 'AISC' (incl mining tax & others) = (Revenue - Cash flow pre-tax) / (Revenue / Pd price).
This works out as : MT (Lo&WN) = $950/oz, FLANKS = $814/oz. If these values look high - they also include the 10% mining tax (but only for the years without Capex - otherwise it will be skew the figures).
Annual PGM production can be identified by Revenue/$2223 as the report suggests $2223 used for Pd (you can lower this value to $1913 by taking into account Pt)
Therefore why wait for ACF, you can create your own ACF model - but please note, WACC applied in the report is stated by ACF as 12% (MT) and 17% (Flanks), but for the discount on the cash flows it looks like 14% discount is the real value used for Flanks, MT looks good at about 12%.

One other point - under the EPCF package (which is already in place for MT and I am sure will be expanded for Flanks and any future project), the Capex is held on the contractors book until full production is reached - so you could justify the Capax does not need to be in the model at all - and just add an amount to the modified 'AISC' used.

Hello CAW1,
Thank you for providing your NPV for the various mines and its contribution on SP.
Just to let you know - I value the MT+Flanks mine at about the same as yours (I am 3p higher actually on a good day).
I have a few items of interest which you may or may not like to also provide info - I don't mind if you rather not, but I would find of interest - especially for Flanks and the JVs, but also MT:
- In which year is your first year of revenue from each mine.
- In which year does each mine reach full production capacity.

For information - during the weekend I put some info out on the ACF report - and what they used for AISC++ (++ as will also include such costs as mining tax etc). Just take the difference between Revenue and Cash flow pre-tax divided by koz produced. (koz produced is Revenue/$2223 as they use $2223 for the price of Pd). Using a single value between revenue and pre-tax cash flow simplifies the calculation. I think I shall post shortly on this - as I have noticed today some are saying if ACF will update their report - they don't need to - we can model it!!

Crippz,
Not a question , rather than an observation - use of the word 'intended'.
I intend to go to the pub and have a half shandy later today - same as my intention yesterday!!
You know what they say about best intentions !!

Not sure what the fuss is all about - to me this is EUA ensuring excess funding is available to cover expenses for the JV developments - thereby allowing all proceeds from asset sales to be ring-fenced and fully available for dividends and associated expenses.

If assumption above is correct - then again SP stumbles because EUA being very economic with the reasoning. I am sure if they made such comment in the RNS about 'allowing the ability to ring-fence possible asset sale monies for to maximise possible dividend payment' then SP would still be higher. Its obvious the BOD only care about the actual share price when it matters to the companies finances.

GLG / ASPENWOOD,
Understand what you both saying.
Have good sunday evening.