Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
What makes you think hole 3 is way past planned depth, the only info I have seen is that hole 3 is planned to 775m (granted I think this is out of date). Then if you take depth at last RNS and then add 70m/d * 7 you pretty much arrive at this planned depth figure....
For me if we don’t get an RNS today I’ll start assuming this is another hole which exceeds expectations (in terms of length), and if we do get an RNS today I’d expect us to be around 800m which is hardly a bad thing!
Hi Steve
For me the issue is that we have some information, probably some of which is out of date e.g. if you look at the below map (25th RNS) you can see where hole 3 was proposed, then if you go NNW from the hole location it appears to be testing new locations (granted I don’t think we know which direction hole 2 went) so not sure (in my very limited drilling knowledge) how this would help prove up the 3D model? So I guess the location has changed, but can’t be sure as this isn’t clear to me from the RNS.
https://www.rns-pdf.londonstockexchange.com/rns/8229M_2-2021-1-25.pdf
I am expecting a clear picture of all of the activities they have carried out once the phase 1 drilling has been complete and the team have had time to digest all the information, and as a long term holder here I’m both happy and excited to wait for this.
Cheers
James
Hi CE
Based on the below drill 3 is for 775m, although as you mention this could easily have changed now. It’s a shame CB didn’t give a little more info on this hole in terms of target depth.
https://www.rns-pdf.londonstockexchange.com/rns/8229M_2-2021-1-25.pdf
Cheers
James
Hi CE
My biggest concern is that they will drill to target depth (which we don’t know) regardless of whether they have passed through mineralisation, I understand they would do this for modelling purposes eg gather full information (happy to be corrected on this)
I know CB says no news is good news, but I’ve been disappointed before from comments in videos to reality so won’t take this for a given until we get an RNS confirming this.
Cheers
James
Hi Glixxer
Regarding lack of XRF results for hole 2 it seems to me (from going back into the RNS) that no XRF results were conducted while drilling was on going, several mentions of visual copper eg (28 jan RNS)
“ Copper mineralisation, in the form of weak disseminated and fracture-fill chalcopyrite associated with green, propylitic alteration of the bedrock, has been visually identified in core since about 130m depth and has gradually become stronger from 340m towards the current hole depth of 405m”
but nothing about XRF results until the 5th of Feb RNS were it was stated
“ Drill core will now be logged in detail and copper grades will initially be assessed using a hand-held XRF spectrometer prior to sampling for full laboratory analysis for copper, gold and other accompanying elements”
This is quite different to the hole 1 RNS were XRF were continuously mentioned, eg from the 15 jan
“ The Company is using a hand-held pXRF Analyser to provide preliminary indications of copper content and samples for definitive geochemical assay will be submitted to the geochemical laboratory on a progressive basis.”
I’m personally happy to wait for the assay results but perhaps based on my above suggestion we will get hole XRFs next week
Cheers
James
That’s fair, and it’s definitely a positive even if he just sticks with current holding for the time being but I hope you are right and he’s building a stake!
Appreciate the input
Cheers
James
Thanks for the response Rollinginit, and good news
I would imagine they are done buying now then, not sure why they would confirm they brought in f they intended to buy more?
Hi Rollinginit
Don’t get me wrong it sounds a lot like he is talking about XTR, but where has this been confirmed?
Cheers
James
Hi CE
Call me a pessimist but I don’t think we will be getting revenue of $40 million from Eureka.
CB has previously stated we will get 55-60% to of spot copper for the concentrate, and we only have 50% of the project? In addition not sure if there is any royalty due to the government/land owners.
For me we will only get up to roughly $40m revenue once all projects come online (even then we may not depending on how the accounting treatments work eg in Manica it’s basically a NPI so our revenue may just be the monthly cash flow).
Having said that the market will value us on our cash generation not revenue (plus obviously BR potential)
Hope my waffle makes sense
Cheers
James
Hi Andrew
My notes are similar in terms of FCF, however I also noted down that Eureka was to be a 360k ton pa project. We are now 250k-300k, so it’s logical that the FCF would be a bit less (although I suspect copper price has offset)
Cheers
James
Hi CE
Regarding your Eureka calculations, I understand that we won’t get spot copper but approx 60% and from memory this is a JV with KPZ as well (50:50 I think). Happy to be corrected on either of these points.
But assuming the above is correct I’ll expect revenue in the region of $12m - $18m, and FCF of $250k ( I am assuming the slightly smaller project from what CB previously mentioned is offset by higher prices).
Cheers
James
Hi CE
I have in my notes from the July presentation ( I think this was a TW one before they fell out.....) that the Eureka plan is to mine 360k tonnes per year and that they will receive 55-60% of copper price for the concentrate. They are targeting a mine life of 5-6 years, and generating $250k FCF per month.
I also have a note from the interview that they are budgeting copper at $5k/ton, not sure if this is what CB used when saying the $250k figure but I am sure there is upside to $250k as price in July was around $6.5k/ton (this assumes the scale of the project and price as a % of spot copper still hold).
Lots to be excited about!
Cheers
James
Hi Dibs
No moaning on my part about the warrants, simply pointing out that there is likely to be a few more of these type RNS (cyber mentioned only 5 million) based on historic raises!
Cheers
James
I think these are from the previous fundraiser where there were 27 million warrants at 1.85p, so still another 25 million of these left
I agree it wasn’t the best interview, but in CB defence not sure the questions helped massively. Hopefully we get a proper podcast with CB and the new non exec once the first drilling phase is finished and assay results published.
Did CB not say the aim was to get to 1Mt at 0.5%? I would imagine that this would allow upside on the tonnage by reducing the cut off. Could this be a defensively strategy from CB to bide time before the AA option is hit? Wild speculation on my part (although I don’t feel bad about speculating with some of the rubbish posted on here today) but it makes sense to me if there are other interested parties to delay hitting the AA option. Shame we don’t fully know the mechanics of the AA option.
Cheers
James
Hi Dave
“I think they are targeting the newly discovered material actually (being, to me, the "down plunge extension")”
Maybe I am missing something but hole 2 is in no way close to the newly discovered material from the below image, the 330m ish from hole 1
https://www.rns-pdf.londonstockexchange.com/rns/8229M_3-2021-1-25.pdf
Happy to be corrected on this?
Cheers
James
Prospect Ore completed the deal with AA in Dec 2017, hence the 3 year 50% Claus has expired
Hi Lucky
If I’m not mistaken (poor sound quality) CB said in his last interview with Zak that he update would likely be Thursday, So I’m expecting an update tomorrow.
Cheers
James
Sorry Ella, I see what you mean now! I think I’ll be dreaming of 0.1% gold and retirement now myself :-)