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Lucky,

I copied this from TG a while back from a poster called MikeM thought it might come in handy. This would be through a bigger plant they are working toward permitting and developing I would think.

Grades! First interview Colin states 3%. Second interview their chief geologist states 3-4%.

3% = 6g/t (roughly) that’s pretty epic grades

Let’s break the numbers down some more using base case figures

60k tonnes a year.

Antimony at $25k per tonne (currently more like $50k)

Assume 80% recovery

Minus a decent discount and tax, opex

Just one deposit of the many antimony licence could produce around $25 m a year!! So rough £18m

Let’s again go with a bottom end PE 10 for miners. Ranges 10-40 ish

10 x 18m =180 m to £180m MCAP for XTR.

Ignore first bit of last post 🙄 am numpty.

Trojarova has a historic resource of 415,000 tonnes grading 0.162% antimony

“NPV is not value in situ”.

No of course it’s not, NPV and IRR are far more important and give the business case for investment toward economic extraction. Projects that have a feasibility study and a funding solution are worth inherently more than those without. This is ultimately what the company are working toward, with a scoping or similar ‘initial’ mining study as per the development plan which will be supported by an economic model, that is likely to follow within a month or two of the MRE where a valuation can ‘begin’ to be firmly placed on the project with IRR to be able to compare with peers.

The first real project milestone will be a study report. The JORC, along with metallurgy and other data are the inputs sent to third party mining consultants to produce the study and a flowsheet design.

Without any kind of supporting study, Colin will have a weak hand around the negotiating table to bring in further investment to take the project toward PFS or see it monetised in other ways.

That is when any M&A activity will be welcomed.

Just had an update Jez. How everybody was complaining about CB not using social media more often!

When he does…tut

What we can see from the mine video is two men with a shovel and a wheelbarrow. Obviously working shifts to optimise productivity.

Was suggested that Colin offer them use of his own personal barrow to speed things up a bit, but as Colin is likely the only person we know that can peel an orange in his pocket, there was more chance of a camel haggling over the price of the barrow in a Marrakech souk than Colin lending it to them.

Obvious to a point, but in the real world spot price is ‘just’ one input with many other factors that go toward NPV that rarely ever remain constant. Higher selling prices usually change the model, sometimes in “worst case” scenarios the other free cash flow drivers in the model can actually negate a lot of the price rise but can also improves project NPV in other ways.

Many things come into play, DCF timings can change if they decide the phasing of the starter mine can be improved with higher forecast revenue, so CapEx and OpEx can increase, any off take agreement would likely have a price cap or be stepped, to reduce some of the benefits from price increases that could also affect the model.

Not sure about the effects on taxes and currency conversion along with forecasting higher revenue in the model, but just because selling price doubles never assume NPV doubles. Particularly where economic viability of a starter mine is being modelled.

Cheers for that, is actually a lot of metres to be fully funded. Looking at the development plan it is clear they are intending to use the same model to fast track production. Bringing in a specialist engineering consultancy to create conceptual open pit mine (shell) plans, especially for a high-grade 'starter' pit. Looking at feasibility of pre concentrating the ore for hauling to a central processing plant and Complete a Preliminary PFS and Preliminary PEA in the shortest possible timeframe. Has all the hallmarks of a rapid development pathway.

Do we know how many total metres of drilling were planned through the latest fundraise? Not in RNS that can see. There will of course be a cut off point for drilling data to make it into the JORC estimate normally up to 3 months prior. But plenty of time with contingency to reach target I would have thought adding confidence in a Q3 delivery.

“If you want to make 10x gains over the next 5 years , then focus on the emerging economies of LATAM/Africa/India.” - @TheGhostBZW

Hi Ghost there’s one single most important factor to any emerging economy to advance from moving billions of people from poverty to middle income status. That begins with infrastructure and the electrification of the planet.

At the heart of the problem lies the billion or so people on the planet that do not have access to electricity. So this factor alone will drive major copper demand in an already increasing supply deficit that is constrained through lack of investment over the past 15-20 years to find major new discoveries to feed that supply. Let alone the demands for AI, and the energy transition are adding to the deficit.

So if you believe in the electrification of the planet, which you must do, you have to believe in copper as the single most important hedge to that.

Luckily you are in amongst some great copper growth opportunities with CB. Not solely as exploration plays but very soon to be revenue producing mining operations that have significant resource and development growth potential toward company valuations that will not just follow and track the spot price.

A growth opportunity in a real world scenario where copper price is going to increase far more than inflation over the next 5 years is the perfect storm for multibags right here right now!

Many thanks for sharing your study report @Arbroathsmokey, i do agree the inputs could be quite similar (not necessarily metallurgically as all deposits are unique) but could follow similar project pathway.

Monty-Muambe maiden JORC preceded the scoping study by just a month which the estimate, focused on the high-grade zones of the deposit, following Altonas strategy of focusing on the part of the deposit that is most likely to be exploitable, as opposed to "drilling for numbers", in order to fast-track the project towards production. Is a smart move and one many Colin Bird investors in his other companies will recognise. Hope and Gorob, Silverking and their Antimony mine in Morocco. Another REE project in the stable btw 😉

Reading how Kendrick are being progressive toward a development study I think will be taking a very similar approach with kens economic constraints with a drill, build and expand model to monetise the project without having to deliver an expensive full feasibility study.

Bit more on the MRE economic cut off.

—Under the JORC Code, a Mineral Resource must have “reasonable prospects for eventual economic extraction” —

Which usually means the estimate is reported using a cut-off grade, NSR, cut-off value, mining shape constraint, or another economic filter that demonstrates the material could plausibly be mined profitably.

REE deposits are often more complex to classify because their value can more depend a lot more on the mix of different rare earth elements contained with other penalty elements hosted, the quality of the concentrate, recoveries and payability. As well as mining method, strip ratio in this case and processing cost assumptions I mentioned in last post.

Because of that, the “cut-off” is likely to be based on TREO grade with NdPr content, value per tonne or net value after processing being the other.

So the JORC may not necessarily use a single universal grade cut-off like “1.0% TREO”. It may use a more sophisticated economic threshold, but only ‘may’ at this stage.

So something to look out for when the inaugural MRE for Teufelskuppe is reported. What is so encouraging, is the technical confidence they have already gained through early field work surface sampling and some deeper test boreholes to already go ahead with classifying the resource so they are able to proceed with a scoping or similar early development study in such quick succession, which they are already progressing toward.

Thanks for all your quality input as always @News very informative and helpfull.

Referring back to my previous couple of posts on the JORC you can begin to appreciate where I am coming from reading Archers latest article and where the company will certainly wish to increase in confidence and scale through routine drilling, starting from that maiden MRE.

There are always two objectives of drilling, one is to increase resource, the other being to add value. The JORC will give average target mineral grades contained within the rock, the overall tonnage of host rock that has been outlined and importantly the cut off grade that determines how low grades can be, to sustain mining based on industry recognised cost assumptions for a deposit of the type, size and preferred mining method.

As their flagship asset at Teufelskuppe is potentially open pittable the cut off is likely to be quite low so drilling for grades that are above this will add values and volumes to MRE2+ As expected grades will be far more than the cut off grade is likely to be, drilling out will begin to add absolutely huge amounts to the resource and future NPV.

This Maiden resource will be just a benchmark and springboard for what could come.

$400m valuation is likely to be a drop in the ocean once a maiden MRE lands.

https://open.substack.com/pub/thatstocksguy/p/kendrick?r=4j2ztm&utm_campaign=post&utm_medium=email

Looks like the jury’s out jez, although one of those likes was mine 🤩

Thought I was defending Tony Lukonde’s professional integrity, but still you never fail to make me laugh Jez.

But suppose a fair one in light of. However, I do think CB is going to make me a shed load of money so yes why wouldn’t I think along those lines.

Cheers for giving some clarity on that, but we are still talking about a commercial dispute, hardly criminal activity by Lukonde of which is being implied with CB’ association with this ‘alleged’ untrustworthy individual.

Just because a person is arrested it doesn’t mean they are instantly criminalised.

And you then come back with,

“And those persons are being taken to court, currently, by past partners”

Which is not accurate as,

The Licence is currently subject to Zambian Court proceedings in respect of a dispute between Chilibwe and its previous joint venture partner which has restricted Chilibwe to date from developing the Project (the "Existing Joint Venture"). Chilibwe has lodged a case with the High Court for Zambia to have the Existing Joint Venture terminated such that it would retain a 100% interest in the Licence. 

https://www.lse.co.uk/rns/XTR/chilibwe-licence-decision-to-commence-drilling-vkd9nf5cdfr7q41.html

It’s the other way round Gixxer.

How long have you been sitting on that bit of media to throw it back at someone in you inevitable style. As far as I had previously looked into them 2021 arrests, (old news) there are no records of any charges being upheld, court preceding from records, or any follow up news articles or media relating to the matter. If there was a case to answer, I’m sure the African mining ministry would not allow further applications to be granted thereafter with any current licenses being revoked.

Likely regulatory responses

* Suspend or revoke existing mining licenses/permits if the conviction shows the company violated mining, environmental, labor, or criminal laws.

* Refuse renewal of any licenses already held.

* Impose fines, penalties, or compliance orders.

* Require remediation of environmental damage or illegal extraction sites.

* Place the company under stricter monitoring if the law allows continued operations.

* Disqualify the company from obtaining new licenses for a period of time.

* In severe cases, blacklist directors or related entities if local law permits.

Unless you can provide some other evidence to substantiate your claim he cannot be trusted.

I tried.

Is good point JDAU and same would certainly apply to their partners. Tony lakonde and Tolai

“Can we trust this company anyway,” says Gixxer.

My Chilibwe commented was saturical, but if it is going to open up questions that is ok, even if nothing to do with quarryable antimony.

Chilibwe Mining’s main activity is the Chilibwe Project. The executive director is ‘Tony’ Lukonde Makungu who is also an executive director and shareholder of Cooperlemon Consultancy Limited and president of Oval Mining which holds the small scale mining license at Silverking which are partnered with Cooperlemon and Xtract in their JV.

So I don’t think trust or non disclose are an issue. It appears a close knit collaboration between all parties.