Member Info for Hogsnipe

Theo - remember when posters here were saying Pensana was nothing but smoke and mirrors - it's a fake and it's not real - show us the evidence?

Agreed - completing the construction camp isn't a huge step forward but it is undoubtedly real. It's also keeping the ASWF, M&G etc, onside and demonstrates real commitment in Angola.

Re project viability/financing - China is intent on securing its RE concentrate imports for the next 20 years. Africa is a major target, and Angola is and has been a huge beneficiary of Chinese FDI. China has invested vastly more in Africa than the US or UK since 2015, and US, EU & UK have let themselves be shoved to the back of the bus as far as African minerals extraction is concerned.

If Pensana can't get investment capital due to China's RE price rigging, neither can any US/Australian/Canadian/S American etc RE miners/refiner. It's been slow but the West has now fully woken up to the challenge of breaking China's choke-hold on its military manufacturing, climate change programs, energy strategy, chip technology, robotics, AI and all the stuff linked to RE's and critical minerals.

Whether the West will achieve this through tariffs (Chinese exported EVs in EU, USA, Canada now face massive tariffs), or through industry subsidies, or a China-exclusive RE pricing structure/market - the underlying risks and penalties of doing sweet FA are now transparent.

Either we continue to be economic junkies hooked on artificially cheap finished goods from China, or we opt out of a corrupted market based on intellectual property theft, dubious mining practices, rigged prices, exploited labour, environmental piracy, over-production and world-wide dumping.

I continue to believe that Pensana is uniquely positioned and well-advanced as a potential starting point to get the ball rolling. No other minor RE company is in the same state of readiness to commence building and operations in Angola or Africa. I'm expecting good news soon.

It's either that, or an end-of-line Pensana fire sale to China (wink wink).

China has added a new critical metal to its expanding restricted export list - antimony.

See: "Rare Metals Prices Surge As China Restricts Exports"

https://oilprice.com/Energy/Energy-General/Rare-Metals-Prices-Surge-As-China-Restricts-Exports.html

"On August 14, Beijing tightened the noose and announced export restrictions on antimony as part of the country's latest move to restrict critical mineral shipments. And now prices of antimony and gallium are surging despite the export restrictions having yet to go into effect".

Antimony prices have rocketed to an all-time high, with spot prices in China and Europe surpassing $25,000 per tonne, more than double prices at the end of 2023.

Not surprisingly, shares of rare metal [producers are flying: Hunan Gold Corporation, one of the biggest antimony producers, has seen its shares gain 35% in the year-to-date while those of Perpetua Resources have nearly tripled over the past six months".

Aug 7 2024 - the annual Australian Diggers and Dealers Mining Forum conference pressed their government for RE supply chains subsidies to prevent China from wiping out all competitive RE supply-chain investment through its rigged RE pricing worldwide.

Kim Beazley in the opening keynote address said: "We should be comfortable with subsidising lossmaking producers to prevent China, which controls entire light and heavy rare earths supply chains stretching to metallisation, magnet production and end products in defence, consumer electronics, electric vehicles and wind turbines, killing competitors by suppressing prices".

“The Chinese do mine to missile production, and they will take their profit at any point along that road, and if destroying the rare earth industry in another country is what has to be done, they’ll do it,” Beazley said and concluded - “So I say, fine, guess what? We’re going to do what you do. We are going to acquire this stuff".

Nd and Pr prices appear to have bottomed and continue a 6 week recovery after China's producers baulked at any further price squeezing.

Latest subscriber news message from Pensana:

https://imgur.com/a/k0wElUp

Zoom and scroll image.

Steffffi - agree with you on RE index/PRE SP correlation. Both VanEck REMX and MVIS Global Rare Earths Index show the same story.

This topic came up here a while ago and my view was that the market makers are in the same boat as us private PRE investors as far as PRE is concerned - kept in the dark with very little hard information or useful news from the company. So it would be logical for the MMs just to hitch the PRE SP to either of these indices.

The FTSE 350 Mining Index also correlates closely with PRE so they may just be using that.

I still can't understand why, if REs are currently dirt cheap, and its agreed the whole world faces a future supply crunch for REs - why don't we just call China's bluff and start stock-piling RE feedstocks till further notice and see how that turns out?

Off 15% looks bad doesn't it?

Meaningless more like - 6 x buy to sell ratio today - and still the SP goes down?

When a markdown of 1 penny is a -7% hit on the SP, it's difficult not to laugh at this feeble tree-shaking.

No signs of anything like a panicked sell-off by PRE shareholders is there?

Wonder if you can day-trade if you're a market maker?

Industry calls for US to boost stockpiles of REs and directly fund exploration/mine development in countries regarded as "domestic resources" - UK, Canada, Australia, as well as on its home ground:

https://www.industryweek.com/the-economy/competitiveness/article/55128029/chinas-threat-to-ban-critical-mineral-exports-is-not-a-bluff

One way of testing China's commitment to manipulating RE prices below market value, in order to stifle western investment in non-China RE supply chains, is to massively ramp up critical mineral stockpiles in US and Europe, until China itself starts to feel its supply-side pips squeak. China is already the world's primary RE consumer, but no longer has enough domestic supply and now has to import REs.

If China was coerced into an early introduction of RE export restrictions, the instant RE price explosion and the aftershock to the West would in fact open the doors to Western investment in proftable independent supply chains and the breathing space to do it using their (now extremely valuable) stockpiles.

It would be interesting to see what would happen to RE prices if the US simply declared this intention to China....

Tony - re: ASWF coming to the rescue with another $5M bung - supposing they dive down the same rabbit hole as Atherley and liquidate a few million of the fund's shares to be granted back when the sun comes out?

Problem is - there's no way of knowing if PA's recent disposal of 1.5M shares has led to the current SP plunge is there?

If ASWF did go for what would have to be a much larger disposal, the SP would be hammered down to a level where Pensana's primary asset become a no-brainer buy-out - step forward China or maybe the US looking for a cheap sop to their promises to invest in African mineral development.

Pensana (PRE.L) announces that further to the GBP 2 million facility made available to the Company (PRE.L) by two of its directors, as announced on 28 March 2024 (the "Facility"), the Chairman, Mr Paul Atherley, has sold 1,500,000 ordinary shares and will use the proceeds to make GBP 250,000 available to the Company under the Facility as working capital support to the Company whilst it finalises its main fundraising for the Longonjo project.

To avoid incurring interest costs, the Company wishes to settle the ensuing amount due under the Facility as soon as possible and intends to do so by the issue to the Chairman of 1,500,000 ordinary shares being equal to the number sold by the Chairman, at an effective price of 16.666 pence per ordinary share (the "Repayment Shares").

An excellent summary here of the whole issue of RE and Magnet supply chains, what's gone wrong with the market, and how the west's RE industry must immediately lobby for national government support through legislation if we ever hope to out-manouevre China:

https://www.iluka.com/media/zb4gb5n3/iluka-reia-2024-presentation-notes.pdf

As Iluka says, we cannot allow China to be the final arbiter of the world's climate change programme, neither can we relinquish control over our military and technological development to Chinese manipulation. And handing over all our future EV manufacturing to China is another non-option. Our unemployed car workers may be less than ecstatic driving to the Job Centre no matter how cheap their BYD motors are.

China continues to use bent market pricing to encroach and control new alternative supply chains for RE/Magnet materials:

https://www.afr.com/companies/mining/china-magnet-maker-nabs-stake-in-forrest-backed-rare-earths-play-20240709-p5js9g

Hastings Metals Technology must be finding backing equally hard as Pensana - all for peanuts - $7m for 10% of the business and a board seat sounds beyond desperation to me.

When will the West see how we are being taken to the cleaners?

It's not often worth checking the posts here - 90% blocked by my filters.....

Tony - re: Boeing titanium. I'd say that the fault lies more with Boeing's quality control and procurement standards, not with the off-spec titanium originally made in China. As regards fake RE from China - the elephant in the room isn't the quality or spec of the RE's - it's the hidden state subsidies, and the buried horrendous ESG costs. There is consensus that the NdPr market is rigged by China so that prices have become unrelated to normal supply/demand balance, specifically to prevent entry of new suppliers into the worldwide RE market.

IMHO, with US and EU current application of tariff sanctions to prevent large-scale dumping of EVs by China, and the above consensus, that further economic action to restore rational NdPr pricing and fair markets is imminent. One example is Australia's Treasury order to several China-linked investors to dispose of Northern Mineral (heavy REE metals) AUS shares, amounting to 10.4% of its issued share capital, on national interest grounds. Another is the work being done by US to develop a floor price-based mechanism for RE market prices, which enables China-idependent supply lines to be built.

China itself continues to be the largest consumer of NdPr for magnets, and benefits from it's own rigged market. See here for some food for thought:

https://news.metal.com/newscontent/102788751/SMM:-NdFeB-Production-to-Continue-Rising-in-2024-Outlook-for-Rare-Earth-Demand-in-Automobiles-Wind-Power-and-Home-Appliances

The figures are astonishing:

- air-conditioner manufacture - 5,483 tons of NdPr alloy, with an 11% increase in 2023 pushed by global warming and high temperatures in South China and no sign of future demand slowing.

- off-shore wind -20% increase over 2022 in installed capacity - 75GW added in 2023 alone, requiring 3,844 tons of NdPr alloy. In comparison- by 2023, the UK had approximately 28GW total installed wind capacity over 25 years, AND China will have built around 1,300GW of wind and solar capacity by the end of 2024, so beating its original plan target of 1,200 GW in 2030 by 6 years.

- EVs - China produced 36% more EVs than in 2022 - 9.587 m. For comparison the total Europe-wide sales of EVs in 2023 was about 3m. No figures are given for quantities of NdPr magnet alloy consumed by China's domestic EV production, but assuming the average of 3.7kg per vehicle, it works out at roughly 35.5kt

- elevators/escalators/lifts - produced 1.548 million units, up 5% YoY, bringing a total demand of 2,630 tons of Pr-Nd alloy.

All of these domestic production targets are set through China's 5-year plan programme of expansion, and forecasts are for a continued 20% year on year growth, except the latter which is subject to a housing recession expected to stifle demand in the next year or two.

Https://www.techspot.com/news/103374-europe-largest-deposit-rare-earth-metals-discovered-ancient.html

Norwegian mining company Rare Earths Norway (REN) announced that after three years of exploration, it has discovered Europe's largest proven deposit of rare earth elements southwest of Norway's capital city Oslo, near Lake Norsjø. The complex was the pipe of an active volcano around 580 million years ago. The upper part of the volcano has since eroded away, exposing the 1.2-mile-in-diameter magma-filled pipe. REN says the magma, which has solidified into carbonatite, holds rare earth elements such as neodymium and praseodymium of about 1.5M tonnes of magnet REE ores.

However, I see the deposits are at substantial depths, and the surface land is well-populated with agricultural development, so there will be much green resistance. Also, REN needs a cool £0.75billion to launch the first phase of mining production by 2030, so development of this mine looks like it faces multiple major economic headwinds and other lead-time issues.

Https://www.prnewswire.com/news-releases/energy-fuels-achieves-commercial-production-of-on-spec-separated-rare-earths-at-its-white-mesa-mill-in-utah-while-simultaneously-advancing-uranium-production-302168094.html

ENERGY FUELS (USA) Jun 10 24 shows the way for Pensana - becoming the first US refiner for decades to produce a full-spec separated magnet-quality NdPr stream from monazite feed. Phase 1 plant ready to produce 850 to 1000 tons of NdPr yearly, with commercial quantities shipping this month, using a similar process as Pensana/Longonjo.

This is on the back of Energy Fuels main business of US uranium extraction/refining operation and recent acquisitions in Bahia/Brazil and the Donald Project/Australia with supplies of REE monazite mineral sands deposits. ENERGY FUELS is now planning expansion of the Phase 1 NdPr processing plant to hit 4,000 to 6,000 tons annually after Phase 2 and 3 completion, aiming to be a "world-class" supplier of magnet-grade separated NdPr outside of China.

Like Pensana, ENERGY FUELS is depending on winning customer supply agreements, government backing, offtake agreements and direct financial support to secure Phase 2 & 3 completion.

If there was any serious risk with Pensana's immediate future, I think there should have been some defensive trading by the top 20 PRE Register holders by now. So far all I've found is a grumble in the M&G Recovery Fund 2023 performance report about their 34.6m PRE holding, to the effect that "Notable detractors included our holdings in miner Pensana".

Looking back over the last two weeks PRE trading, daily average buys = 390K shares, sells = 244K shares. Net movement is therefore + on the buy side by 146K shares (and yes, I do know someone's buy is someones else's sell, but market makers make markets). Todays PRE register shows 288.8M PRE shares issued. So the average net daily trading movement for the last two weeks amounts to one twentieth of one percent of the issued shaes - 0.05% of the action that is.

So by all means carry on with your sh**fest here and witter on about PRE doom and disaster if it helps you through the day - 99.95% of the rest of us just get on with life and wait in hope for the good news. Long-term investors - the clue is in the name.

Initial lack of support and indifference from the EU over Biden's new China tariffs may soon have to harden to action.

The EU was already well advanced towards reaching its decision whether it should increase Chinese EV tariffs from the existing 10%, to avoid decimation of its own auto industry by the looming tsunami of ultra-cheap, China-subsidised EVs.

The problem now is that the Biden closure of the US EV market to China inevitably diverts the focus for China's surplus EV dumping to the EU. It now seems obvious that "Brussels will have to act quickly, either to put its own tariffs in place or to accept a flood of Chinese-made products". UK will almost certainly follow suit after the usual 3 years of in-fighting and delay.

Looking at some of the commentary around "what will China's response be", the consensus is that it will be measured, targeted and fairly quick. The damage to US - China trade balance from the new tariffs is about $18bn, so China is likely to go for equivalent cost retaliation, but may choose to hit "pain points" specific to US and EU which don't cause collateral damage or alienate China's other markets.

Given that permanent magnets are No.2 on the list of items the US critically depends on China for supply (77%) and the EU is similar, China may well do to permanent magnets what it did in August last year with gallium and germanium exports, - drastically restrict export quotas/shipments to the west.

If this happens, there will be a chaotic scramble to buy up and lock-in non-China sources of magnets and magnet materials, with rampant stockpiling - and NdPr prices will take off accordingly.

Hopefully LSE won't remove all upper-case this time - who knows?

Mumbles/Tony - re: US tariffs action on China. It's not just Ev's now subject to new tariffs - the latest US trade restrictions also includes new 25% import tariff on permanent magnets in 2026, and 25% on critical minerals (not including REs though) in 2025.

By continuing to avoid imposing tariffs on rare earth minerals, the US is obligingly signalling to China it's chronic weakness/exposure over RE supply chains.

China has previously raised its own import tariffs on US rare earth minerals for refining in China in retaliation to a wide range of US tariffs imposed by Trump.

I'd be amazed if China didn't do the same again now. It's in a very strong position to squeeze the US and EU by restricting NdPr magnet grade raw metal exports, hiking its own import tariffs for non-China mined rare earths which still have to be refined in China, preventing the export of RE refining and processing equipment/technology/IP to US and EU, and introducing punitive export embargoes on shipment of NdPr permanent magnets to the West. Only Japan, Germany, France and US have permanent magnet manufacturing and they all depend on China for the pure NdPr powders.

China can survive for many months/years even, just producing EVs and wind turbines for its internal market, but also has the non-US/EU world markets of Africa, Asia-Pacific, Middle-east, India etc. It has also stockpiled quite a lot of RE's/gold for a rainy day. It has an ongoing programme to develop factories in 3rd-party countries like Mexico which will be able to export to the US. It also is investing in many off-shored partnership/co-operative projects to build basically Chinese-sourced infrastructure projects in the tariff-imposing countries themselves - eg: the JLR battery mega-factory at Taunton.

I don't think it's going to be very long now until we'll see China mobilising its RE economic warfare a(rs)enal against the West.

300% rise in NdPr metals and magnets coming down the line??

(IMHO- DYOR- This is not investment advice, etc etc)

mumbles/tony - re: us tariffs action on china. it's not just evs now subject to new tariffs - the latest us trade restrictions also includes new 25% import tariff on permanent magnets in 2026, and 25% on critical minerals (not including res though) in 2025.

by continuing to avoid imposing tariffs on rare earth minerals, the us is obligingly signalling to china it's chronic weakness/exposure over re supply chains.

china has previously raised its own import tariffs on us rare earth minerals for refining in china in retaliation to a wide range of us tariffs imposed by trump.

i'd be amazed if china didn't do the same again now. it's in a very strong position to squeeze the us and eu by restricting ndpr magnet grade raw metal exports, hiking its own import tariffs for non-china mined rare earths which still have to be refined in china, preventing the export of re refining and processing equipment/technology/ip to us and eu, and introducing punitive export embargoes on shipment of ndpr permanent magnets to the west. only japan, germany, france and us have permanent magnet manufacturing and they all depend on china for the pure ndpr powders.

china can survive for many months/years even, just producing evs and wind turbines for its internal market, but also has the non-us/eu world markets of africa, asia-pacific, middle-east, india etc. it has also stockpiled quite a lot of re's/gold for a rainy day. it has an ongoing programme to develop factories in 3rd-party countries like mexico which will be able to export to the us. it also is investing in many off-shored partnership/co-operative projects to build basically chinese-sourced infrastructure projects in the tariff-imposing countries themselves - eg: the jlr battery mega-factory at taunton.

i don't think it's going to be very long now until we'll see china mobilising its re economic warfare ****nal against the west.

300% price rise in ndpr metals and magnets coming down the line??

(imho- dyor- this is not investment advice, etc etc)

Succinct discussion here of China's NdPr market pricing manipulation and what needs to be done if the west wants to break China's choke-hold with their own supply chains:

https://source.benchmarkminerals.com/article/higher-prices-needed-to-develop-ex-china-rare-earths-supply

No punches pulled on how difficult private investment in new supply chains has become:

'At current rare earth prices no planned rare earth projects outside of China can achieve a 15% return on investment, according to Benchmark’s Rare Earth Forecast. Almost 40% of pipeline ex-China rare earth mines require prices of between $75/kg to $85/kg, according to Benchmark. 15% of this pipeline requires even higher prices, at above $85 a kilogram'.

and, even though low RE prices maintained by China are hitting their own internal producers' profits hard in the last 6 months:

'Adding to the difficulties for Western miners is the fact that Chinese mines have also been ramping up supply, despite lower prices. Beijing announced a third rare earth mining and smelter quota in late 2023, rather than the normal two per year. As a result, the PrNd market is expected to be in a surplus out to 2026'

First quarter 2024 anaysis shows that non-China investment in rare earths supply nevertheless substantially increased to $1.5bn, but largely government-sourced, with private investment trailing badly at $0.4bn.

However, according to Benchmark, 'no Chinese rare earth miners reach “good practice,” in terms of their (ESG) sustainability performance, compared to 100% of mining companies in Australia who reach this grade'.

So the answer seems to lie in 'ESG pricing' . The US is already embarked on setting up a pricing mechanism which incorporates surcharges for bad ESG fundamentals associated with China's rare earths extraction (and more notably Myanmar's), to create a level-playing field of sustainable world-market NdPr prices. This needs to happen in months rather than years.

TT - I can only agree with you on HMG's utterly disastrous priorities management.

But, see here for an emerging view that NdPr price looks like it has bottomed and is now on upward trend, reflecting the real underlying economics of global supply and demand:

https://www.youtube.com/watch?v=0iaqPeD1GUM

I don't see any significant shift in technology to alleviate climate change - it's still overwhelmingly wind turbines, solar panels and EVs on a massive scale, especially within China itself.

It wouldn't take much of a Chinese screw-tighten on REs to make the West see just how much it will have to pay if it keeps waffling along on supply chains security.