Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
@framaog
"I don't agree with thjis "So any transaction that does not involve us paying Duferco the $5.75M (plus interest so ~6M) must be deemed by the company to be in our best interest.""
I didn't say YOU would think it is in our best interest.
We knocked 14.5M off the price due to V price performance and tricky conditions. We took certain terms in return for that. I am certainly not disagreeing that we may have found ourselves with our SP being affected by this (or something). I also, as much as anyone or more, want the SP to rise and am frustrated by the current frankly ridiculous price (I'm currently near 50% down on what is, for me, a very large sum of money).
But i also see Fortune et al building a multi billion MCap business. If anyone thinks that particular omelette can be made without a few eggs being broken then they are very much mistaken.
I put my money in here because of absolute faith in Fortune, the company and the product and they have done nothing to dissuade me they are worthy of it. Deals are done, assets acquired, production increased, the SP will follow.
FWIW I am about to email Chika again myself to ask if we can have more info. I would like the company to communicate more but I understand if they cannot and trust they are doing it with the long term best interest of the company (and, therefore, me) at heart.
Ok I'm going to try and whizz out some maths again. I am neither an accountant nor an electrical engineer so take anything I say with a pinch of salt and I obviously welcome corrections.
The RNS states that Duferco can convert a maximum of $11.5M worth of shares in the first tranche, and that we have the option of reducing that by 50% with an early repayment. So any transaction that does not involve us paying Duferco the $5.75M (plus interest so ~6M) must be deemed by the company to be in our best interest.
Until Duferco have converted or settled 50% of the notes we cannot raise significant money or debt without making additional payments to Duferco. So any impact this clause is having on the share price, or the options the company have available to them, will be lifted soon. I do wonder if this may be more relevant than any dilution TBH..
So, unless the company decides it is in our best interest to allow the full dilution to allow Duferco to take on the maximum number of shares as an II, any potential dilution amounts to:
$5.75M with a 5% discount so a little over 6M effective buying power
Company current MCap is roughly $200M (because the calculation for debt is in $ im taking our current roughly 150M MCap and converting).
This is a roughly 3% dilution if BMN decide it is, or 6% if it is decided to be in our best interest to have a larger II on board.
Now if Duferco choose not to convert at the end of the first year then they leave us still bound by the clauses where any raise or loan means we have to make payments to Duferco and, not only that, but any sale of significant asset leaves us obligated to repay.
So it seems to me to be very (very) much in our best interest for the first 50% to be settled ASAP. In return for all these clauses and loan notes we got a $14.5m discount on the purchase of Vanchem. Covid changed the landscape of everything and any deal made cannot be judged based on it's effects.
But last time we had dilution we went flying afterwards. And I have absolutely no doubt the time will come where the truly ridiculous price we find ourselves currently at will be blown out of the water. But I'm just not sure the (possible) dilution from Duferco is having much effect, although the conditions that came along with it might be.
It is also correct that the visit was not compulsory due to Covid restrictions on travel. I have no idea if they attended or not.
I have also just been through all of the EIAs and am more confident than ever that we will get as much of these contracts as we can handle. Enough to show the world what VRFBs can do and light a fire under the industry. (and not like Lithium batteries light a fire under themselves). Are we going to be part of a hybrid solution on some sites? Probably. Are we going to win some sites outright? Possibly. Are we ruled out of any sites? Certainly not.
This is igniting the touch paper.
All my opinion of course, my money is where my mouth is and I trust my own research far more than some bitter twonk.
I also emailed Chika (first time I've ever felt compelled to do so) and have yet to receive a response. There is def something in the wind. The timing of Enerox with the Eskom tender, the money already invested into JSE. Something is going to happen. May just have yet another very small top up at this ridiculously ridiculous price. Something has to give at some point.
https://www.eskom.co.za/OurCompany/SustainableDevelopment/EnvironmentalImpactAssessments/SkaapvleiSereBESS/Documents/FBAR/BESS%20Skaapvlei%20Final%20BAR_Exec%20Summ.pdf
Is the exact document I refer to.
Linked from this page:
https://www.eskom.co.za/OurCompany/SustainableDevelopment/EnvironmentalImpactAssessments/SkaapvleiSereBESS/Pages/default.aspx
3. Final Basic Assessment Report (FBAR)
Executive Summary < that link
Just noticed that Executive Summary is dated October 2019. Still great though and thanks very much for sharing Floyd81. Just gets more and more exciting all the time. It is quite literally unfeasible that we do not get a big chunk of these projects. In my head at least!
Just having a quick browse of Package 1 FBAR Executive Summary.
Eskom is considering two BESS technology alternatives for battery storage:
• Technology Alt. 1: Self-contained (solid state) batteries (Figure 6); and
• Technology Alt. 2: Flow batteries (Figure 7).
Eskom is proposing two layout alternatives:
• Layout Alt. 1: BESS housed inside a building/ shed; and
• Layout Alt. 2: Stand-alone Containerized Battery Units (unhoused).
Given the comparison of alternatives (Table 2), implementation of Technology Alternatives 2 and Layout Alternative 2 are supported by the EAP, although all alternatives are deemed acceptable and feasible.
----
Wow, super nice, surely? Haven't looked at the others yet and don't have time to. Be interesting if they repeat the same message. Both possible, flow batteries recommended.
I do believe that uncertainty creates situations that whoever is making money on the current share price and trading pattern are keen to exploit. And the reality is we do not know the final figures. I would also like clarity so we can move on to the next, more important, things. Hopefully soon eh. (I realise they do not have to provide these figures but again clarity helps sentiment)
Nice. It is worth repeating many times the areas in which VRFBs excel and are already, and will continue, to carve out market share in a rapidly expanding market. Long life, long duration, fast response grid support and balancing for all the renewable generation that is being added at an incredible pace.
Sure Lithium-Ion CAN operate in this space with less life span, less ability to recycle, and more possibilities of going BOOM and with a reducing to non existent cost advantage already! But it's so clearly a very exciting time as the demand for batteries moves into longer duration storage and right into VRFBs house, with V prices rising (but not too high) and us positioned to capitalise on all of this in a massive way all the way through the supply chain!
Never mind resistance at 15p. Boring is what that is. This too shall pass! But maybe I'll have another little buy first.
Yeah why are sells going through lower than I am being offered? I am only going off Google showing the last trade vs the amount I am offered but the difference is quite large. But when a buy goes through it is very similar to what I am offered. Almost exactly in fact. Very strange.
Thanks Alfa that is really helpful. I do totally understand that 200MW is the amount generated vs 800MWh being the amount stored. And really that 800MWh storage is what takes the vanadium so is most important in our terms, even though the 200MW is equally important in terms of usefulness.
I do struggle with the difference between 200MW and 200MWh when we are talking in terms of an hour of generation or usage. And it is a battery doing both. Mathematically they are the same number. And in the different verbiage used in consumption and generation when the numbers are equal.
Although I do absolutely understand an 800MWh battery on a full charge can generate 200MW for 4 hours or less for longer.
So duh see I really was rushing something there to land at 9600. And I literally have no idea how - nothing adds up to that :/ (almost like it powering 200 apartments!) 2500 is absolutely correct at 8%.
Again I will try and improve my knowledge so that even if the maths are off it is a little clearer what i am driving at!
I’m obviously still not sure what is off with the maths but am very clear now that I am off with the verbiage. I will do some research on this for sure, and make sure I understand it fully so that I can hopefully understand what 8% actually represents in real terms.
Just to be clear though, if I possibly could, are you saying that even the calculation that if something provides 8%, then 13 of said something could provide 100% is incorrect? Because I’m sure of the usage of percent and if I at least understand that part is correct then I have something to go off.
Well I’m a little disappointed in that as a response tbh. And compass who I hope wasn’t directing at me. It may not have been the phrasing of the initial question but I am genuinely interested in this and did maths to help understand the power requirements and amount of the problem one battery of this size solves, not to state that batteries had to displace all forms of electricity generation.
I quoted an ofcom article, not a journalist, and gave numbers I hoped would be correct but prepared to be discussed. Just because in practice the battery doesn’t supply all of the grid, all of the time, doesn’t make the numbers invalid or the incorrect way to calculate it, surely? Neither does it make “shave 8% of peak power” an accurate calculation in itself.
Presumably by 8% of peak power they are saying they have a peak power consumption of 9600MWh then? The figures I found suggest 11000MWh for New York but I didn’t want to try and do maths on numbers I couldn’t confirm and 8% sounds very precise without stating 8% of what. Fwiw I read the 8% quote in a journalistic piece years ago.
Does that mean that 13 batteries can provide all of the peak power? And by that rationale less than 130 of these units could provide all the peak power for the UK (all things being equal)? So the figures are off by some factor of 10 based on ofcoms quoted figure of house power consumption?
Again, I am not stating the blindingly obvious that batteries will supply all of the peak power. Understanding the energy mix is beyond my pay grade. But, personally, I really would like to understand how the maths are so off and am very grateful of any help to do so. Presumably it is because the ofcom figures are not based on peak figures over a large number of households but instead on average use per household. Which I suppose makes a lot of sense.
A factor of 10 is still ruddy huge though.
Also for clarity the Dalian battery is 200MW / 800MWh. Which I think means, running at full power and with no other sources of energy, it would power 40000 homes for 4 hours, or 20000 homes for 8 hours.
So for 65m people with 2.5 per house that’s 26m households. So to power everyone for 8 hours a day solely by battery we would need 1300 batteries of this size. This is unrealistic and also doesn’t take into account non household electricity and growth in electric cars. But it gives some indicator of size of market we are aiming at here.
Very happy to be corrected on maths it’s the early hours of the morning and I should be asleep.
https://www.ofgem.gov.uk/ofgem-publications/76160/13537-elecgenfactsfspdf
They reckon 2000 homes from 1MWh (which seems high to me, each home only consuming 0.5kWh?) but what do I know. No idea what they are conjuring up with 200 apartments. 200 apartment blocks? 200 apartments for the year every hour?
Clearly the world is going to need a lot of batteries but not quite one the size of a small town per apartment block!
Wow! Vent the dangerous gases? Explode upwards? Insane methods to make the incorrect tech fit. I am a software engineer and good software engineering (or any engineering) requires selecting the correct tool for the job. Dead ends will always be pursued by some people and Lithium + Grid Scale Storage is one of those dead ends.
"We will make it work this ... Boom! ... next time!"
I don't think the same approach as has been used with unmanned rockets will work with batteries in populated areas.
Libero, you grow on me more and more. I know we are on the same team but I like your calm optimistic attitude a lot. Whilst others are behaving like children, using real names like some kind of threat. If only they actually where children so the behaviour could be easily excused. Sigh.
I was never overly fond of RK. Too much rarara, and I certainly feel he was selling down whilst blowing sunshine. Not that I care. But it’s how I see it. But I’m certainly not insecure in my investment.
This will explode is my opinion. Now. 3 months. 6 months. I don’t really care although would prefer we doubled, then doubled again so that I can moan about us being undervalued rather than wondering how people are so stupid they think 14p is somehow overpriced.
I put my faith in what I see as an honourable ceo and board. What my research tells me is going to be an explosive growth market. And hey, if I’m wrong, and I may well be, it will be my own decision through my own research not cos some wannabe 12 year old on a bulletin board thinks he’s soooo super clever drawing attention to things he doesn’t even understand. Not pointing fingers with that it just happens so often it’s a tired cliche.
Muppets. Again not pointing fingers just jaded.
14.5p they are offering me a sell now. And by Jimminy we are due a rather large price rise and, as per the details outlined by LionelGreen below, and as per last time, it could happen very quickly. And (hopefully) right now.