Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Bitcoin: this is grotesque abuse of existing shareholders. If you thought KAV might 10 bag its now 1 or 2 max. You can get better odds buying easyJet or Persimmon without the Turney BS factor.
Upside is now severely limited even if KAV made a discovery tomorrow because of the threat of massive dilution. I thought the strategy from 2-3 months ago was to drill three main licence areas and then agree JVs so this blows that strategy out of the window.
They’ve taken a recent decision i.e KSZ first.
I don’t definitively know if a drill contractor has been appointed because this has not been announced but it must be close given the twitter posts with Brett looking at the site.
I based the estimate on the basis the drill site and accommodation camp could take several weeks to set up from scratch.
There was some reference on Twitter about data interpretation and drill plan, a bit odd given they’ve had 12 months to prepare.
2-4 weeks would seem a reasonable estimate based on the noises coming out of Kavango inc ‘summer of drilling’, it’s unlikely to be next week, you would hope it’s not the back end of June (but always possible).
If you’ve sold your KAV shares then politely jog on. The cynical campaign to trash the share price has been going on for the last 18 months.
If you hold KAV shares then you’re doing so for a reason;
In 2-4 weeks KAV commences KSZ drilling. DHEM has identified a 28,000 Siemens target likely to be pyrrhotite bearing massive sulphide. It’s a medium depth 400-550m drill in difficult ground conditions, but they will have learnt from last year. Success opens up further Area B targets, a stacked IOCG, additions northern KSZ targets, shallower exploration in south KSZ and of course a joint venture. KSZDD003 is a major value inflection point for Kavango, should have completed by the end of June with assays cSept.
Ditau has gone from REEs to lode gold, yes the initial assays were disappointing in absolute terms but they must have significant information to be getting this excited. This drills in about 3 months time.
KCB Karakubis is surrounded by Sandfire, Rio Tinto & ENERG. Kavango have engaged Dave Catterall the regional expert and interestingly he preferred Karakubis to PL036/2020 which was more advanced. In theory it should be drilled Oct/Nov.
There is imminent news on two early stage acquisitions, likely lithium or nickel in Zimbabwe or Namibia.
I’ve previously called for Turney to resign or be sacked. The share options, warrants, massive dilution, 2022 bonus and placing, the current cash position, the PL082 shambles, the failure to make a discovery in 2022, all this is true and deeply irritating to the point where a committee of shareholders could produce a more coherent strategy. But we are where we are, its priced in at 1p and there are half a dozen inflection points which could see a major re-rate.
It turns out the reference to KSZ drilling in the annual report was true!
https://twitter.com/KavangoRes/status/1652260381732093958
legalwolf: I looked at the cash flow statement and they loaned $2.7m to Kanye. Not sure what the accounting treatment for Kanye is, I'd have thought it was a 100% owned subsidiary which is consolidated on the balance sheet inc cash. Is the group cash position $2.2m as stated in which case they burned though over $2m in Nov/Dec or is there additional cash held by Kanye not counted?
Interesting to look at POW's next steps, wonder how similar AMT, Kav's most recent survey technique, is to MobileMT?
"o Complete a high-resolution mobile magnetotellurics ("MobileMT") airborne geophysical survey. MobileMT is on the cutting edge of geophysical survey methodology and compared to TDEM has multiple advantages including:
o Allows for good discrimination between resistive units (e.g. TDEM cannot effectively map resistive units or discriminate between 1000 ohm-m and 5000 ohm-m formations).
o Can detect superconductors directly.
o Provides superior depth penetration than even high powered TDEM systems (up to 2km in certain geological environments).
o System experiences no problems with induced polarisation ("IP") effects, zero coupling zones or super para-magnetic effects.
o Highest efficiently and quick surveying over flat areas like southern Botswana and can average production of 100km per day with a comparatively low production cost.
§ Across PL311/2016 prepare detailed geological/structural interpretation incorporating all historical drilling and geophysical data available. Trace feeder dyke as possible magma conduit."
I take exception that KAV is desperate or spinning fake news in fact quite the opposite.
Is a 28,000 conductance reading a needle in a hay stack? The other conductors are likely to be up graded 8-10,000 & 4-6,000 so a cracking set of targets.
I've no idea what's going on with timing. BW has a small population so there isn't an endless choice of drilling contractors and I get the feeling Mindea/KAV relations aren't the best so perhaps that's an issue.
The key at the moment seems to be the Ditau assays expected in the next week looking for pathfinders like iron pyrite and ****nic as well as anomalous gold and copper.
One of the pillars of KAV's strategy is project financing & BT said all three projects were ready. He said it was too early stage for major at the KSZ but there were other options. The Lassonde curve visualises the mining life cycle and KAV is in pre-discovery in KSZ and Ditau and still concept in the KCB. For many private investors the money is made in the next phase - discovery. So if KAV does a deal in pre-discovery it provides cash to fund discovery but the returns are significantly lower because the partner takes on risk. You might want or have to do that with the KSZ IOCG because 1000-2000m holes are $200-400k each and it will take spectacular grades to be commercial. The B conductors are shallower 400-600m and so it might be worth the risk of KAV going it alone. BT seemed reluctant to re-drill KSZ, my guess is he wants a JV deal pre drill so if B1 fails there's still cash for the other KSZ targets but the downside is PIs who already suffered 75% dilution in 2022, suffer further 50% dilution on KSZ. BT said the 2022 B1 drill missed "by meters" and its cost PIs millions. Is BT playing chicken with a JV partner by delaying the KSZ drill because the deal isn't attractive, probably. At this rate it won't be drilled until August.
My preference is to drill KSZ first pre JV as KAVs best chance of making a discovery.
BT can be infuriating and misleading at times not least those KSZ assays. Healthy skepticism is fine.
Re Ditau assays, these were addressed in the video from last week, the significance won’t be grades but the decisions which are then triggered.
https://www.youtube.com/watch?v=a4fdJySXV-s
Exploration requires theories or the geo’s wouldn’t get out of bed. Theories change in relation to the evidence found eg Ditau carbonatites now IOCG.
Yes it’s quiet, that means BT and co are doing some work!
News flow:
Acquisition(s), assuming a decision was taken in March following the site visit, the legal papers and final negotiation might take a month or two.
Assay results from Ditau, by end of April.
Target identification for Ditau.
Updated targets and geophys on KSZ.
KSZ or Ditau first decision, (likely Ditau).
New drill partner?
Summer of drilling likely end of May or early June.
JV partners, the second pillar of Ben’s strategy, hopefully pushed into the long grass for 6 months.
Other than PIs, I'm not seeing much evidence of funds or professional investors targeting the junior mining sector.
I was surprised Darren has a new Obonga target, hammers home the blunderbuss approach when focussing on Dotted Lake might be more fruitful. Panther had written off Dotted following a mediocre gold drill yet a few yards away lies a promising Nickel target discovered by our neighbours. It pains me say DH is utterly useless.
The comms changed with the Molopo drill campaign, very little information was released, pentlandite should be quite visible, PGEs are generally harder to evaluate pre assays. I get POW does not want to be accused of misleading investors and some of the historical Molopo drilling was uncommercial, nonetheless PIs are clueless if they really found anything. The cynic in me says they want to bundle Tati & Molopo results so there’s at least one good news story.