Stephan Bernstein, CEO of GreenRoc, details the PFS results for the new graphite processing plant. Watch the video here.
In a couple of weeks we will be focusing much more on the future than the past. My gut tells me that the imminent A4 assays will completely turn the needle on what Botswana has to offer and the economics of T3 pit.
You just have to see the effect of a resurgent Oil price on company valuations. I think fortuitously MOD may have timed this to perfection. DFS and FID around April next year with an anticipated Copper Price looking forward to $7,500 per tonne. Combine that with A4 exploration results due ( hole 8 the key) in the next 10 days. We could confidently be looking at a T3 mine with a Resource 100mts plus and a targeted yr 3 production circa 50-60ktpa to rival Sandfire Resouces ( minus the gold but lower extraction cost). Just need to be patient, ignore the malaise and continue proving up. My personal target is a T/O over Mod circa $2.00 around February 19 .
I suspect the previous RNS was incorrect. I couldn,t get my head around a 4% increase whilst the Share Price was going side ways! Sprott definetly NOT SELLING!!!
Regardless of general malaise with MOD share price if A4 comes in, If it has a comparable resource to T3 then this will be an absolute gamechanger. This is why MMc said in the interview following hole 3 Anns that this whole was even more important than the original 52m hole discovering T3. The economics of the mine will change beyond recognition. Overnight the development will go from a small economically robust project to a Medium sized mine with huge economies of scale, with a Resource circa 100mt plus , 50 -60ktpa ramp up. ( without reference to t3 underground or T1) . At that point the bigger fish will start circling, just hope that we will have time to unlock some of the potential of T20/4 and 23. Either way you cut it, the returns will be life changing. Hole 8 assay due within the next fortnight will be the main determinant. Is A4 comparable to T3 ? Or possibly is it even better?!
Lundin are an incredibly astute and hard nosed family. I believe they have a very long history with RR and Sprott as joint investors /funders and would have a huge amount of trust as neither are in competition with each other. You could tell from the interview the warmth and respect between both individuals. Sprott have no interest in taking MOD or MTR into production but to exit with a significant profit. Lundin is actively seeking a new project having missed out on Nevsun. RR is on record as saying that he has confidence that MOD's prospect has all the hall marks of a Tier 1 district and I am sure that he would want someone like Lundin to take it on, with their resources. He is not a director of MTR so able to enter into discussions or express an opinion, public or private freely without fiduciary constraints. Quite often deals are done through the back door prior to any public statement.
Lundin have said to RR that they are interested in the Kalahari project having lost out on Nevsun and would pull the trigger if enough Resource is found. T3 offers the huge attraction that we know only too well. Great economics, state of the art mine design with bolt ons as project ramps up. Great infrastructure and a safe jurisdiction. What it is lacking for someone like Lundin is scale and if A4 comes in as hoped the magic 100mt will be passed. The only question is do they wait for scoping study ? Would MOD sell T3 and A4 but retain remaining acerage and do what they do best and explore with a huge war chest? I suspect RR knows and it is just a matter of time!
Sprott aren,t fools with warrants I believe they hold 20% fully dilluted. This huge jump is on the back of increasing appetite for M&A in the commodity arena and funnily enough around the time of a really interesting interview RR undertook with the Lundin family!
Absolutely, huge show of confidence. Share register getting tighter and with Sprotts contacts within the mining industry should put MTR on the radar and ofcourse MOD. Just need hole 8 to prove up, and the confidence that possibly A4 is as big as T3 can begin to gain credence.
From someone that ones 1.4% of MOD.
https://hotcopper.com.au/threads/whoopsadaysie.4417021/page-11?post_id=35495249#.W5YB3ehKiwc
Taken from MOD hotcopper.
Bonker great post as always.
There is a huge disconnect bewteen the market valuation and the value of the ballooning T3 project to a Major. As MMc said in recent interview the bigger players are all over this and the magic number is 100mt . With T3 underground we are likely to see Resource upgrade to circa 70mt and year 3 production nearing 40ktpa. However if A4 alone comes in that Resource could be nearer 120mts, add in one more dome and you are looking at a mine with a resource capable of producing 75ktpa plus. That would create a value, with Sandfire Resources as a comparison, well over $1bn US! and MOD would still have more exploration targets that it could handle. I personally have targeted April next year for either a Decision to Mine ( 10% chance) or an outright sale (90%).
162 completely agree it isn,t just the finding of a new resource which could readily rival T3 but the means by which that Resource has been identified. Larger players must be looking at this closely. MOD must be very confident of what they have found to add more rigs, from what I recall the maximum number of rigs at its height on T3 was 7, I suspect MOD will be nearer double digits on A4 to prove up and scope out. We could very easily see T3 by March, looking at a 100mt Resource to rival Cupric Canyon Zone 5!
https://www.telegraph.co.uk/business/2018/09/01/growing-electric-car-market-means-vital-make-friends-africa/
Give it a couple of months like Bonker says and all will be put into perspective! Fully funded now and just waiting for transfomational drilling news.
Fantastic vote of confidence. Hopefully draw a line over shinnanigans of last few weeks and concentrate on what is really happening!. MTR fully funded and it looks like A4 and A1 are going to transform the project. Can,t even begin to contemplate T20. Great news!!
Thanks Joe, I was really wondering if I had made the right decision here! I,l definetly keep my eye out for the "Keyboard Warriors". Thanks so much for the heads up!
162, yes ,first of all apologies wanted to thankyou for updating your blog and all your hard earned effort. Like wise Bonker. I met the CFO and Development Director In walsall a few months ago and we had lunch with a number of Private investors ( predominantly in MTR). I asked Stef the CFO about potential dillution, particularly in relation to the development of the T3 pit. He intimated that the Board's model was "not significant" dillution to fund the equity commitment of any finance deal, and to achieve this the BOD were mindful of a significantly higher share price by the time dillution was required. This model also included acceptable perameters from the significant nu,mber of institutions that had expressed an interest in providing finance ( to such a degree the other concern manaegment had was not to over leverage themselves!). Stef referred to the Blue Ocean note and a target of 20c which would equalted ( prior to JV dillution) of around $2. This , the BOD recognised could only come from exploration success. Arguably this is one of the huge advantages of the deal MMc has negotiated in that the JV still allow MTR to reatin its 30% interest in any exploration success and arguably at least 50% of the $2 target would be proportioned to exploration.
If as 162 A1 comes in along with A4 the whole thesis that this is a district sized licence will gain a huge degree of traction. T3 pit provides the framework for commercialisation and the ground breaking AEM technique provides the pathfinder tool to uncover the deposits. 162 is also absolutely spot on regarding the need by MOD to raise again and I suspect this will be done post October LSE listing and post achieving a $1 share price. Regarding a takeover, I think it will obviously depend upon the size of the cheque, but part of me is thinking that a hybrid may be to farm out to a larger player, a significant % of T3 in exchange for funding of the development, whilst still maintaining Operating status. If we can be patient for another 2 to 3 months, there are so many catalysts. we may have 2 T3 like deposits identified and A9 etc... may also see the drill bit. KML may also start to take shape with AEM . T20 that is a whole different world!
Older, good question. I intially thought that, but I understand that for the DFS and all its required components, re financing and EIA etc... MOD have to have a cut off date if they are going to hit their March 19 timetable for FID. We all know that it is highly likely that 3MTPA will be just a start but as the pit is designed for fairly quick pod like expansion they can , in a relatively short time, add and bring throughput up to the targets we all want. Any Financial institution will want to work on exiting proven Resource and the cash flow projections etc,.. As T3 dome and then T3 underground etc... are being proven up etc... the Resource will inevitable increase significantly, but MOD need to work with something if they are going to hit their FID for end of 1st Qtr 19. That is my take anyway!
https://www.directorstalk.net/interview-metal-tiger-release-more-positive-drilling-results-for-kalahari-copper-belt/
Absolutely excellent interview by Michael. Finding it hard to control his enthusiasm for A4. "Recent drill result more important than the T3 Discovery hole!". This is going to be an absolute monster. Patience!
CJ, Good post but I must disagree with view of MOD ANNs as being "good not stellar", I think we will all look back at this Anns as transformational. Not just in terms of the Assay but the confirmation that AEM as a pathfinding tool has been confirmed. MOD tend to be very conservative in their statements and even they cannot hide their excitement. No I think this Anns is extraordinary, A1 looks to be another mirror. Firs 2 Domes, first 2 holes have hit! By mid late September I think DISTRICT will be the key word to describe the licence.