Member Info for jqnewcastle

I think we cannot rule out the possibility that there may be problem to raise money in ST2. Although the possibility should be tiny, it happened to BCN recently.

There are so many discussion on strategic partner. I read the RNS of royalty financing agreement again (25/10/16), here is the details: "Under the Royalty Financing Agreement, Hancock has agreed to: (1) purchase a royalty on the Project of 5 per cent of gross revenue on the first 13 million tonnes per annum ("mtpa") of sales produced in each calendar year and 1 per cent for sales volumes above 13 mtpa in return for US$250 million (the "Royalty") and, (2) upon drawdown of the Royalty purchase amount, Hancock will subscribe for new ordinary shares in the Company in an amount of US$50 million subject to certain conditions. The structure of the Royalty Financing Agreement is similar to that of the arrangements with mineral rights holders and runs for the life of the Project or 70 years, whichever is longer. "

Related to (1), they paid 250m. The TorP price is about $130/t (page 7 in Nov 18 presentation) and the cost is $29.4/t, meaning the gross revenue is about $100/t. Assume the average sell is 7 mtpa, it just takes about 7 years they can get all the money back. The contract will last for 70 yrs! I understand SXX did need a strategic partner at that moment, but it is not CHEAP!

Related to (2), they paid 20p per share.

Hi PB, it should be not difficult to calculate: the total share issued is about 4.7 B, and the highest price after ST1 is about 38p, and thus the highest market capitalization is about 1.78 B (comparing with 1.12B at the moment).

In the worst case scenario that all 600m additional cost has to be covered by new shares with price of 20p, 3 B need to be issued, resulting in a total shares of 7.7B after dilution. It is still not too bad. Using the presentation of Nov 18, NPV under contract case with 20% extra capex is 5.641 B, equivalent to 73p per share.

Roulette: you are right. I don't think the discussion in this board has any influence to SP.
SXX-Pound-Party: Actually I don't agree most of the points raised by McCrum.

I am a share holder of SXX for quite a long time (longer than many members in this board) and have learnt a big lesson from st1 finance. We are better to read reports from different angles before we decide to buy or sell shares. GLA.

I read the FT article again and found that we may need to pay attention to some his points, although I think Dan McCrum is a bit too negative to SXX...

https://ftalphaville.ft.com/2018/08/07/1533614400000/Sirius-Minerals--money-for-a-hole-in-the-ground/?kbc=0212dd3e-6e94-49fa-97d6-94fb0d132e9c

Dear Stokey, do you think it is realistic to take a quarter or over of the market around the world in a short period for a new company? Also if you check the history of SXX, quite a few ToP contracts have been cancelled or amended. I am not saying the target is not achievable, but it is very difficult. This is my concern. Banks and institute investors have all those information (and much more), and thus, to get a good deal for st2 might be more difficult than st1.

Hi Stokey, from the table the demand in 2020 is 37mt/yr, and you know why the target of 13mt/yr or 20mt/yr is far too ambitious for a new company. I sold most of my holdings when sp was over 30 but I think the current sp is quite attractive and will top up, but I have a bit concern for st2 (learnt a lesson from st1).

Thanks Myosotis. From the table, sale of 20mt/yr (even 13mt/yr) is way too ambitious for SXX. Is this part of the reasons why the FT article was quite negative to SXX?

Think about what happened after ft1 was signed off....

Thanks BF and MT. I have been stock market for quite a while, but don't know how MMs work until today.

Nickel bull worries intensify for key electric vehicle component: https://www.ft.com/content/a7dd2842-dc2b-11e8-8f50-cbae5495d92b

Spiverine, if SP will go down further say around 20, you may buy more. After ST1 finance, SP went down from over 30 to around 15. I topped up a lot in the range of 15 and 20, and the return was very good.

Not a good start...Hopefully it will be better this afternoon

There is almost no trade so far yet

Considering the Mkt Cap of Amer is £140M only, 4m net is not a small number (4*50=$200M=£150M).

Skier1: although I think SP may go down further, not sure it will go to the range of 10-15. The current SP is attractive. I start to buy back.

Number of shares increased for just a third, not too bad.

I think you can wait for some more time to top up.

The SP was over 30p before ST1. The deals of ST1 included an equity placement of 20P and convertible Bond (8.5% rate with conversion price of 25P), and then SP went down to less than 15P (luckily I topped up quite a lot around that price). We then need to think about what deals we may get for ST2...

Agree. It may go down to around 20. It might not be easy to get a very good deal for ST2 (think about what happened in ST1). I am waiting and will top up then.