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Stranger, Van
Sunday Ariana catch up. Over the years I shudder to think how may hours I have spent, at least I know what my Mastermind specialist subject would be.
Some great posts. I feel at sea here, in November 2019 I was black and white about the Ozaltin deal. Put simply I thought it was the work of the devil, bit like peanuts. Not only the loss of interest in the assets (which, as has been proved by the financing method employed at Tavsan, could now provide a c.300k ounce split 50:50 between just ourselves and Proccea) but also loss of control in the Turkish operations. Basically Ozaltin will take the cash and can tell AAU to bugger off if it gets vocal. All that was achieved was some special divis which many of us reinvested at a SP higher than now and consequently benefitted relatively little.
This is different. IF (capitals intended) all goes well Dokwe appears to be a steal. There appears to be reasons why the owners want to sell, they know Sener from the past, they will retain a strong voice if not control in the future of their asset even if taking more of a back seat. Their 36% (or whatever) may mean they address some of the inadequacies of the current board not only in Zimbabwe but the wider AAU portfolio.
Like Stranger I dont think 'new' AAU will go it alone and hope there is a SEPARATE JV set up which avoids loss of control and will de risk. The problem is risk. This asset, if it turned turtle on AAU, could sink the company. Equally it could increase the net assets per share of AAU dramatically, despite the dilution. Its a big project, appears to be open pit, and far more advanced towards production than the jam next decade (or the one after) that Salinbas has become. As for Cyprus don't start me. You wont like me when I'm angry, my shirt falls off and I turn green.
Have a good day all. Commiserations to C&B and LoB for Burnleys predicament!
Ok, I read that they had resigned, but that term as used in auditing speak may have given a wrong impression
Bloody hell, cant even keep an auditor now.
'PKF have confirmed that there are no circumstances connected with their resignation which they consider should be brought to the attention of the Company's members or creditors'.
Yeah right, what they mean is that they ain't going to do any work when there is a good chance they wont receive payment.
Just spent a time reading the Q&A.
Disappointing, or maybe I just got out of bed the wrong side. I would compare the answers to those given by politicians to Laura Kuenssberg on her Sunday morning program. Mind you at least KS has a fallback career as a Tory MP if this sinks the company.
In many cases, particularly the awkward ones, Sener answers a different question to that posed. Or just plain misleading. Examples:
Q The Ozaltin deal was pretty rubbish wasn't it?
A No, the share price went up from 2p to 6.25p! it was great!
Observation: And when everyone stopped looking at you as the messiah it fell back, down to 1.6p only 2 months ago. Over 4 years on its only 2.4p now
Q Why didn't you release production guidance on time this year?
A The dog ate my homework
Observation: Woof
Q Several other companies have shunned Dokwe because of deep desert sand cover. Why is this not a problem for AAU?
A We have found that B&Q have introduced a range of big shovels so its fine!
Observation: I must take my morning tranquiliser
Q Will production really start at Dokwe in 3 years as mentioned in a very very recent RNS?
A Well I said that but its complicated
Observation: We've heard it so before many times Kerim so stop digging as no one believes you anymore.
Q Why no Gantt chart
A Because timings can be hard to predict as they are out of our hands
Observation: if that was true then surely sometimes things would happen more quickly than expected. Like just once maybe?
Q Was involvement in Cyprus a good move
A Yes
Observation: That's a no then. £180k of AAU shareholders money spent to give the Apliki owners fresh data to increase their asking price
Q Will divis be paid to AAU shareholders when Tavsan is in steady state production
A Not sure, maybe
Observations: Ah, not a snowballs chance then
Q Do you care a jot for your ordinary PI shareholders
A Ha, Ha, of course not, don't be silly!
Observation: Ok I made that one up.
Have a good day fellow sufferers
Yep Van, as I said yesterday the circuitous sentence from the RNS about 3 years did mean it incorporated more than a little ambiguity. Could mean they may be able to start to commence development in 3 years! I don't recall Sener even mentioning 3 years this morning, perhaps he thought it best not to. If Dokwe doesn't soak up the dividends then Salinbas will. In fact from the current JVs major shareholders viewpoint Salinbas is more important, at least at the moment, and since Ozaltin control Zenit then AAU may not get dividends from the JV because it will be used to promote the development in Eastern Turkey. That raises the question where the bloody hell does the money come from for Dokwe development, the ex Rockover directors will want some action there because they are no spring chickens themselves. They will of course end up as the major AAU shareholders in June or July this year. My fear is huge debt on the AAU balance sheet, if things go wrong the loan creditors foreclose and equity holders tend to get wiped out.
The Rockover directors, shortly to be AAU directors, may be more astute than this mornings double act, they will hopefully not sit back and allow another big payday for Ozaltin if the Zimbabwe development is to be funded by a new JV there.
You talk about the AAU development not suiting those of our age. Or MDVs. I suspect that the whole development profile is geared to someone of say, now let me think, oh yes, someone of maybe Kerim Seners age??
Well my prediction of not knowing when Dokwe will be in production came to fruition then.
Did notice the slide now shows (from what I could see as I hadn't got my glasses on) Salinbas production from 2026 rather than 2025. So that's nailed on then.......
Sadly the share price is what it is. I don't know what the basis was for the rather precise 687,817,998 number. I guess it gives an exact % in AAU or to equate to a particular sum based on an assumed AAU share price. Dunno haven't thought. I suppose we have to look at what assets each company brings to the table to decide it the (roughly) 1/3, 2/3 split is fair. Somehow you have to adjust each prospect for the stage of development. Dokwe is big, and compare surely to out paltry share of Salinbas after the giveaway JV. Don't know, lets reconvene tomorrow and hope the presentation and Q&A doesn't send the SP any closer to 2p yet again.
I don't know Van. The Dokwe resource is big and effectively AAU gets 2/3 of it. Its a lot of gold, more than I think we will get from anywhere else. The obvious red flags are how does the development get financed while we own 100% and can we trust Zimbabwe? I'm not sure about it as I've always avoided African 'investments' (quotes intentional), as I think we discussed before.
So finance for Dokwe development, as far as I can tell, is by massive equity dilution, debt (lots if tragic stories on AIM about those providing loans wiping out equity holders) or a JV. And after todays RNS we know who that will be with, nailed on - I'm no clairvoyant but I'll bet they will want 51% at least.
I reckon we would all be better selling AAU and buying Ozaltin shares. That way we can benefit from all the things AAU s good at, because directly holding AAU equity certainly isn't doing it.
Three weeks ago AAU had a 3p share price. Now after releasing big news about a deposit some shareholders have been excited about for months and a delayed 2024 production announcement its down to 2.45p. Wasn't news like this supposed to excite shareholders?
PS Is it me or is the Tavsan heap leach plant looking increasingly delayed, vague references onlynow to 2024? Maybe all will be clearer tomorrow. Wont hold my breath for a concise answer.
Well Van in my defence I was against the Ozaltin from day 1. Just work out the value of the lost 26.5% production since the completion of the JV (early 2021?) and very single gram of gold that Tavsan will ever produce. I have and its massively more than AAU received by selling. As for Salinbas where we gave up 76.5%, just don't get me started,
C&B
They will only answer the questions they feel like answering, that always happens. I bet someone will have tabled a question relating to when Dokwe will realistically be developed rather than the following mentioned as part of the RNS the other day, and I'll also bet there will be no concrete reply:
'.....we anticipate advancing the Dokwe project towards production within the next three years'.
What the hell does that mean? AAU may advance towards production but it doesn't say a plant will be there and shovels in the ground.
Sener seems to forget that we have been exposed to ambiguous waffle like that for too long. I would remind people that in presentations in April and December 2022 there was an anticipated production from Salinbas in 2025. Truth is that we aren't a day closer than we were at the time of the wonderful new JV proposed in 2019. To me that is deception at best, outright lies at worst. Does anyone fall for it anymore?
I am in agreement about divis. There is East Turkey to develop with the JV funds and Dokwe to develop as well. AAU will be 100% owner there so no sharing the costs. Unless of course there is a JV in Zimbabwe with someone well funded. And I sincerely hope that someone is not Ozaltin who as far as I am concerned gave very little cash for their huge interest in AAUs Turkish interest and haven't 'enabled' or delivered anything - in Africa they cant even try to put a value on political influence which many seem to think was the reason for them being chosen in Turkey. Beginning to this Ozaltin are effectively the Turkish mafia.
So the current JV partners are interested?
'we are encouraged to note the significant interest that this has generated amongst our existing partners, and we look forward in conjunction with our partners to explore opportunities by which they may become involved in the development of Dokwe'.
What does that mean, another huge giveaway present to Ozaltin? Yes, a JV partner will be needed at Dokwe to fund the plant etc. without loading the balance sheet with debt or unnacceptable equity dilution, but not on the appalling terms achieved for Kiziltepe, Tavsan and Salinbas. Hopefully the Rockover shareholders have sufficient business ability to compensate for the current AAU BoD.
Stranger, I am hopeful that your dream about the JV may happen, with construction costs met by the partner. The Rockover shareholders will be keen to get this nto production due to age and given their influence in AAu they will.have some clout. Maybe not 3 years but hopefully they won't be satisfied with a Salonbas style.crawl. Most know I was critical of the current JV from day 1, but political/ Zimbabwe apprehension excepted I see the potential here
Thanks, Stranger. Good thoughts. At a quick skim read I think you are being hopeful that the current JV will produce 50k for 10 years although I may have missed something. I'd put the average over 10 year lower by 5-10 K given that Kiziltepe is nearing end of its lifetime. The production at Tavasan is maybe 300K total, no matter where it is processed? The only other thing is the prospect of Newmont as a JV partner. They have put their share of Greatlands Haviaron project up for sale as it is too small for them so can't imagine them getting involved at Docwe as a partner.
Thumbs up.