Member Info for Jammer1

CB is a mega bull on copper. He believes the copper price will be over $7000 in a year's time. With the forecasted copper demand expected to increase substantially, possibly double by the end of the 20's decade, and very few good deposits becoming available, he expects good deposits to be wanted by the major mining companies within the next two to three years. He hopes the Botswana deal will be one of those deposits which now needs to be proved up or outlined as soon as possible. As soon as the deal went through about a week ago a placing was on the cards. Personally I am delighted a sizeable amount of money has been raised for a relatively small discount to market price. If CB is right about the copper price and the Botswana deal turns out to be as good as he hopes, then in 3 years time it truly could be a company maker.
In the meantime we now need some monetising events. Hopefully Star Zinc will get going very early next year, and will the phosphate, rare earth asset be monetised in the near future? Lets hope so.

CB is following a similar strategy in Xtract and Bezant, both now with significant copper exploration assets to fund, and surely placings will shortly be seen in these companies as well.

Couldn’t agree more Raxf. Possibly the only oil producer expecting to have a stronger balance sheet at the end of this year than at the beginning of it.

Fair enough TT especially in the current environment.

With a £54m market cap, a lot of future profit is certainly priced in. The time period to profitability seems to keep slipping. Optibiotix might be profitable in 2020, and yes the potential is good for 2021. But boy investors seem to be currently paying a lot for that future potential today?Personally I decided today that I will wait until later this year to reassess whether 2021 might at last be the start of real profitability, and decided not to push the buy button.

TT Not sure why PGM earnings to be worse in H2 than in H1. The PGM basket price has not reduced below the price throughout H1, and in fact would have produced significant bonus earnings in January and February. In volume terms I am also expecting H1s 21K ozs production to be matched at least, with Windsor PGM production fully on stream since the start of H2, the additional PGMozs from this source alone should more than offset the lost production during the COVID shutdown when compared to H1.

Is not a shoddy by product, certainly not at over $1700 per oz.

Moneyhawk, very surprised if we have given up on the PGM rich tailings at DCM. Surely that would have had to be stated in this RNS? It is in DCMs interest as much as Jubilee’s to find a way of monetising the PGMs in the tailings as they are to be getting 40% of the profit.

Don’t forget Jubilee is also a significant chrome concentrate producer, even without DCM fine chrome. And the chrome price is up over 10% in the last month. It would be nice to see a decent positive contribution from the chrome earnings, which I am sure we will due to Inyoni chrome coming on line towards the end of last year. They have also been implementing a number of efficiencies at Windsor chrome plant, so fingers crossed maybe that will start to properly contribute as well.

Edzi, don’t forget the lead that has to be dealt with if the zinc in the tailings is to be processed.

The fine chrome plant has not been profitable at DCM at any time. It was never covering its depreciation costs. The fact they were sharing any positive chrome earnings, would have made the chance of it ever being profitable without future arising s from the mine very unlikely. With no future feed coming from the mine, the short operation life left at DCM made this decision a no brainer. Good to see some contribution from DCM towards the disassembling costs, but as usual no detail? I hope DCM have paid their debt for their contribution towards negative earnings when the chrome price collapsed.At least at the other operations they will not be sharing any positive earnings and the business model should work.

Fine chrome processing a bit like Concorde so far- a great technical achievement but financially awful. This move makes a lot of sense but why no certainty yet about the final destination of the plant. Hopefully by the beginning of 2021 this plant will start producing enough positive earnings to at least cover its depreciation cost. I await with interest about what is going to happen to the PGM rich tailings at DCM so they can be monetised. The PGM plant will not be built now.

TT, If you get a reply from CB please post if possible. I and others, I am sure would be interested in the high level assumptions being made by Galileo in their own figures from June2019. Thanks for posting the info you have already found.

Total Trader the Galileo numbers were established in June 2019, when zinc metal price was just over $2500 per tonne, not the current $2000 per tonne you have used.

Thank you datacheck and others for the interesting responses and thoughts about this company today. Although I thought it had good prospects, I am more certain about them now.

Datacheck, I now see how the £10m p.a figure has been acquired from the high level projection stated in the June 2019 RNS. The "in house projected attributable revenue" figure calculated by Galileo comes with no assumptions behind the calculation, other than it was based on the zinc metal price at the time, which was just over $2500 per tonne. From this assumption they are assuming they will be paid $1250 per tonne of the expected contained zinc metal in the ore, presumably by Jubilee. Jubilee will of course not only have to take account of their own processing costs and desired profit margin to bring the zinc ore to a high quality zinc concentrate , but also the subsequent transport costs to the smelter and then the smelting costs. I believe the latter in June 2019 were about 15% of the metal price, so let us assume Jubilee were assumed to receive 85% of the contained zinc metal price in the concentrate( i.e $2125 per tonne). This would mean they were assumed to be receiving $2125-$1250 = $875 per tonne of expected contained zinc metal for their processing work.
What might be the projected monthly revenue figure be at today's metal price of say $2000 per tonne? For simplicity I shall assume that Jubilee's and the smelter's costs are not linked to the zinc price, so only Galileo will be exposed to zinc price volatility. Galileo would now receive $2000-$875-$375=$750 per tonne of expected contained metal, which is annual projected revenue of $9m. Knock off the projected annual $2mAISC for Galileo's mining and transport costs, and we are left with $7m or approx.£ 5.2m p.a., half of what was projected 11months ago. Still good though, but only half as good as many on this board seem to be assuming! The expected average metal grade expected from the drilling at Star Zinc to date appears to be close on 20%, so let 's hope that materialises. Equally of course zinc prices may go up significantly and back to $2500. Who knows? But I must admit the projected revenue stream of £10m p.a. does seem to be a best case scenario today, with plenty of potential downside particularly in the average grade expectation.

Yes by products indeed. But even Colin has not stated they can be commercially extracted or even if Jubilee will bother to. He seems to throw these facts in to enhance his promotion story.

Thank you Datacheck. I will have a good look at these documents.

The very good part is the fact that 30k tonnes of ore per month was processed. Are the break downs and spare parts issues behind them now? The very bad part is the grade, which will impact on the recovery rate as well as increasing the cash cost per ounce. Apparently expected, so can I assume the amount if capital being spent to resolve the problem was expected as well? Good job the gold price is high!

Datacheck the other query I have is the £10m p.a figure that keeps getting quoted. No idea what zinc price that assumes and whether it properly takes account of the likely Jubilee processing costs to get to the zinc concentrate stage. What I have read seems to me as it is just the zinc metal price less some mining and transport costs. The £10mp.a figure of earnings to Galileo after all costs properly taken into account at a zinc price of $2000a tonne seems just miles too good to be true. Any help on where I can verify this, other than Colin’s in the head calculations, would be appreciated.

Colin Bird always tells a good story, and is always optimistic. He is usually well out on his time lines when promoting his companies.I am not saying there is not potentially excellent value here, but realisation may take longer than many think. CB is rightly holding out for a better deal for the phosphates so it includes decent recognition of the rare earth minerals, so it may be a while before we hear more on this. As far as the zinc projects are concerned it is unlikely Star Zinc will be generating any revenue until early next year. Just a small matter of a small scale mining licence to secure and then for Jubilee to build and commission its zinc processing circuit, which it appears not to be in a big hurry to do so at such low zinc prices. And the other zinc project still also requires the regulatory authorities to agree a transfer of the Kabwe large scale mining licence from BMR without any sting in the tail like picking up some of the clean up liabilities of the Old Kabwe mine on the property. As usual CB glossed over these potential difficulties.