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Just caught up with the interview. My take - the S-series is looking very very good and ABB are hugely excited about it. The ability to compete head on with PEM but at lower cost is very exciting and you can hear this in AB’s voice. It’s possible there’ll be other potential partners who’ll rapidly emerge. However I now fear the L-series will not get very far - maybe a few modest sales for those can’t wait or have lower power requirements but it sounds to me like ABB are unlikely to be buyers - at least not in volume. The markets for the S are bigger than for the L and the product will be more “desirous”, as AB put it, so the 186p share price target should go up if anything, once the market opportunity can be demonstrated. The technology risk does remain, as Junior points out, and as I say, there may already have been an impact on the L. But in the medium term this sounds very positive.

My opinion on the Caravel vs BR comparison - clearly the capex of > £300m there will cause huge dilution, hence their mcap seems relatively low compared to the value of the contained copper at the moment - as will XTR’s before an offer comes in.

The question is, if someone were to bid for Caravel (as a proxy for BR), how much would they pay, given the NPV is c£750m? (I recognise NPV isn’t the only or even main factor here).

Wrt BR, you can see how it’s own NPV could be sizeably different, as there are so many factors involved - potentially greater amount of copper; higher grade (brings forward cash flows); shorter duration of mining (ditto); access to copper-rich zones in early years (ditto). Maybe lower-cost mining. Or these may go the other way. At the end of the day we won’t know some of these parameters because that’s not how BR will be valued in a sale, and a DFS won’t be done. And that’s probably as much as one can say on this matter!

I know it’s not straightforward to compare copper mines but Caravel in Western Oz updated its scoping study two weeks ago. FWIW (I’ve translated into GBP):

662Mt @0.28% Cu Eq for 1.86Mt contained copper
Initial capex £311m
Lifetime revenue £7.83bn
Lifetime net cash flow £2.42bn
Pre-tax NPV (7%) £782m
Pre-tax IRR 26%
based on copper price of US$4/lb, and overall cash costs of mining of US$1.90/lb in years 1-5 (said to be second quartile).
Copper production 35kt pa years 1-5 then 55kt pa for remaining 23 years.

Interesting vid, thx. I like the anticipated growth in revenues mentioned near the end - from ten(s) of millions today to hundreds of millions.....

Excellent news today, clearly the AEM work has been going well and ABB are impressed. But today’s news isn’t the game-changer - that will be in 15m+ time when we have a viable working product - truly a world-leading innovation. Until then, this is still an ongoing development project.

Like everyone else I’m hoping now for a series of announcements about the L series, which I’m expecting to sit alongside as a separate suite of products. Good revenue from them, soon to be followed by a commercial S series, will be sensational.

Good comments on the possibility of share price manipulation by potential participants in the term sheet fundraise. Clearly there’s potential for them to manipulate the price to their advantage and PIs disadvantage. The existence of the term sheet on the one hand has given confidence to investors and underpinned the SP to an extent, but I’m now concerned that it may have the opposite effect. It’d be good to raise this with Bert for comment.

Sq52, thanks for your calcs on Phase 2 drilling. Of course there may be a pause at the year end for the company to take stock and plan Phase 3; perhaps update it’s models and release new data (notwithstanding the assay results that will continue to trickle in until Easter). A £5m raise at 10p would only be c5% dilution so not disastrous if needed.

“Gee whiz, we’re all excited”. Tfr, Colin, tfr. What a great podcast. “Tier1”. “500mt”. “”Much bigger than a 2mt open-cut mine”.

Presumably the copper price at the time of that acquisition also needs to be taken into account. Looks like it was about $3 per pound around that time, currently $4.34 - so 40% higher now.

DO we actually know that Bond is still at COP26? We know he showcased the fuel cell system to the PoW but that might be as far as his involvement went.....

Interesting that the industry standard is to discount by 50% for Indicated/Inferred rather than Measured, Iceberg. On that basis, perhaps we might infer that John Cornford's 3% is halved to 1.5%, which would give about 20p (for Bushranger alone) for 2Mt on a simple 2 x 1.5% x $9000 calculation. But that then makes me think, why give away up to 20p per share (£200m) by selling before proving up the resource? Is that really in the interests of shareholders? Spending another 12m turning much of the indicated into measured and producing a Bankable FS could be well worth it.

That's a key question, Xeiger, and I certainly don't know the answer. Someone posted several months ago about a mine that had been sold quite a few years ago - can't remember the name, not in Oz - that I worked out had been sold on a factor of less than 1.5% for a resource that was mostly inferred with some indicated. But then we know there are so many things to take into account when determining the factor to use (location, ease of mining etc) that that's probably a meaningless comparison.

Interesting question about how much value is ascribed to Measured, Indicated or Inferred resources. No idea, but logic would dictate that the higher the category the greater the value, and that right now we will be no higher than Indicated (at best) at Racecourse. We've referenced Caravel Minerals before - they're developing a mine near Perth, a porphry, and currently have a resource of 662MT at 0.28% Cu (0.15% cut-off) for 1.86Mt contained copper. They are almost at pre-Feasibility Stage, so a little ahead of XTR but not much. This looks an excellent comparator. Of the 1.86Mt of Cu, 1.12Mt is Indicated and 0.73Mt Inferred. And as of today, the company is valued at £85m. Clearly, an identical situation at Bushranger would give about 8.5p per share fully diluted (with African assets on top). Perhaps we could infer, or hope, from this comparison that an updated JORC approaching 2Mt relatively soon on an Indicated/Inferred basis could see the share price reach 10p+. However the hoped-for more significant increase in value will need the catalyst of sale negotiations and/or a lot more resources to be drilled.

At the least, in the next six weeks we need RNS on Juelich delivery, Acciona delivery, ABB charger integrated and ready, and a solid contract with orders. That’s 4. Any more is a bonus IMO. I’m surprised that nothing concrete has been heard about any of these for many months. It feels like a lot of work coming to a head in a short timeframe, which doesn’t usually happen. Have there been some pinch points, or critical staff spread over too many projects? Semiconductor shortage affecting anything? Is a key partner working on a strategic buy-in, which would naturally extend timelines? The web of connected relationships (AFC, ABB, Extreme E, de Nora, Acciona etc) continues to develop. All speculation of course but any of the above are possible. I have total confidence in AFC’s future but wouldn’t be surprised if some timelines stretch out.

DH, there are plenty of reasons why this share may not reach stratospheric heights: eg they don’t reach 2mt, AA aren’t interested and nor is any other major; hence exit strategy is unclear. May be more dilution needed, either for much more drilling or even a decision for XTR to mine itself. Mining proves to be more expensive than thought (and we’re a long way from a DFS that’d clarify this). However these possibilities recede with each drill and assay result. Personally I think we’ll see a slow steady modest rise in SP as the project gradually de-risks but only an offer from AA or another will crystallise the majority of the value here. Others may disagree!

Haggis, why would AFC try to make a splash with product ness during COP26 when the entire media industry will be focused on Glasgow and what’s going on there? AFC’s news would be drowned out by what’s going on elsewhere. Having said that I hope news comes very soon, I’m starting to get a bit nervous. I’d be disappointed if we get a pre-close report this week before any concrete deliveries.

My simplistic understanding is that the sake of Bushranger would fall into that year’s taxable profits (and clearly would form virtually all of them). XTR would be able to offset any carried forward losses sitting on its balance sheet - must be some but I haven’t checked. Then UK corporation tax is 19%. Happy to be corrected!

Abject performance. Didn’t they appoint a new guy to get control of the Yanfolila operation, and if so what has he been doing? It’s all very well finding new reserves but when they come to mine any of it, it all goes to hell. Shareholders haven’t seen a penny from Yanfolila, even the next two years production will go to pay the capex on Koroussa. They need to get a grip.

Whilst the assays today were great, my concern is that they still haven't been able to draw the truck to scale. C'mon guys, how long does it take?

Lucky, I guess the Caravel mcap of c£100m seems low because the market expects them to develop the mine themselves, which will cost huge amounts of capital and dilution. That’s difficult to value right now. I see their PFS is due early next year. We know XTR’s stated strategy is to sell, and they have the benefit of the AA buy-back option. I suppose it’s quite possible XTR’s mcap won’t increase above Caravel’s until a defining moment, namely AA making an offer. (African assets need to be allowed for of course). If a major makes an offer for Caravel then perhaps it would see a jump in value similar to what we’re hoping for?