Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Can't imagine there will be any news this side of the AGM (which is a retrospective look at the past accounting period). If they're close to signing a deal then there will be non-disclosure agreements all round. Happy to be proved wrong, but thing next week is far more likely...
Agree about the timing of the deal likely to be before October, Steve mentioned their preferred timescales of starting in October, so that would suggest the deal is pretty much there. As KOD hold all the cards and have lots of people looking to make a deal I'm sure they can dictate the timescales to a certain extent. My money is on mid-September, but could come before the end of August.
Also good to see he only has 7m shares (no doubt many of us have a larger holding than that) and a large part of his remuneration is going to be via share options, where he can purchase in tranches up to £250k and £750k at .0024p. He's going to want to see the SP as high as possible to maximise his options. Good motivator.
tbh I don't care much about the website, I'm more interested in the work behind the scenes. As many have alluded to, the stock market is a great tool for moving money from the impatient to the patient. I confess I only check in here about once a week now, although I check the RNS newsfeed about 7:10am every trading day (sometimes their news comes a little after 7am, and I've missed the late arrivals). I did my homework, am happy with my purchases and have a timeline of around 5 years before needing to sell (for lifestyle changes), so happy to sit back and wait.
Hi Bonkers, just the observation that KOD is valued at less than £50m and that they're sitting on well over $3.2bn of lithium (depending on the price, but that's still under $1,000 for spod 6). Once the lithium is coming out of the ground the value of the company will inevitably rise, it's just supply and demand. Demand is up and we have the supply, why would BA sell cheap, as a significant shareholder his own self interest is aligned with us shareholders. As you say, this is still AIM, and us share holders may yet be shafted!
Sloppy, that's good news, be interesting to know what levels of lithium they're sitting on, this is all I could find:
"No resources or reserves have been defined on the Pozuelos Property. Reported grades are based on historic sampling results obtained by LitheA during 2010 exploration. While LSC has no reason to believe the historic sample results are not reliable, there can be no assurance that historic sample results will be confirmed by future exploration."
I'm guessing that they have a pretty good idea of quantities to throw nearly $1bn at it. If Bernard secured that kind of cash for KOD we'd be looking at a 20x bagger.
Hi Lav,
You mentioned the Suay Chin deal having timed out previously, what makes you say that?
"Kodal Minerals and Suay Chin entered into the Off-take Term Sheet in March 2017, which, amongst other things, sets out the basis on which the parties will negotiate an extended off-take agreement (“Formal Agreement”) for between 80% and 100% of the spodumene product produced at the Project (the “Contract Quantity”) for a period of three years from the commencement of commercial production".
As there has been no commercial production as yet, why has their agreement timed out? I fully expect Suay Chin to be involved in finding a buyer for our lithium, and they seem well placed.
Apologies in advance if I've missed something obvious.
ghoti
Good stuff, as always, thanks Daz. The bit that got me with the RNS was that Firefinch announced additional lithium in December at something like 74% more than initial estimates. More ore at a slightly lower grade, but the higher price makes it profitable. Saw no update on volumes with KOD, regarding Spod 6% v Spod 5%, or 5.5% and I think no extra drilling took place, just an update on price. Being so close to Firefinch I'd be surprised if the geography is that different. We might have more volumes than preciously thought, and it certainly fits Bernie's MO of playing things close and conservative. He's timing his exit for, I guess, 5 years time when he's got it up and running and he can cash out. I'l wait for those time frames too.
I thought I'd paste this from Kodal's own website, outlining the terms of any off-take agreement:Kodal Minerals and Suay Chin entered into the Off-take Term Sheet in March 2017, which, amongst other things, sets out the basis on which the parties will negotiate an extended off-take agreement (“Formal Agreement”) for between 80% and 100% of the spodumene product produced at the Project (the “Contract Quantity”) for a period of three years from the commencement of commercial production. The parties will commence negotiating the Formal Agreement as soon as reasonably practicable following the Company completing a scoping study in relation to the Bougouni Project (the “Project”).So, to me, that's a pretty direct way of saying they're gonna move to extraction as soon as practicable, once the terms of the off-take agreement have been finalised. Today's RNS outlined the new price, a very conservative $1,060 per tonne, when the real price has been closer to $2,500. I can only assume the delay is on finalising a price for three years from production. BA will be looking to maximise, Suay Chin to minimise costs. I can't think that either party wants this dragging on longer than necessary, not with Li prices so high at the moment.
"According to the rising news, BYD has found 6 lithium mines in Africa and reached the intention to acquire them".
The question for me is how many other companies are actively interested in KOD right now. A bidding war is always nice. Happy to wait a bit longer if it maximises value.
smkr - can you imagine if an investor wanted to take it private? What would the price be? 40% premium on today's prices? Even double would be rubbish. I'd be gutted. I suspect Bernie would be too, as he's mostly paid in shares. Still currently cheap as chips, is a buyout a risk?
I wonder if the price is actually dropping this morning (some mining stocks, esp. Iron are falling due to China and Covid), or with the buzz around lithium of late, whether the MMs are looking to fill significant orders. We'll know by the end of the day! My bet is that we'll end up in the blue once again.