RE: A long and winding road...31 Aug 2019 02:00
Shearclass: great post, thank you for taking the time. I’ve been looking at the same numbers and dates, also was trying to understand Richard Griffiths holdings. I went through the holdings RNSs and the annual reports briefly, to find reference.
RG first appears on the share register in 2011-12: 4.04% (11m shares, presumably bought in the 2011 raise at 25p)
14th Oct 2015: RG subscribes to 42.5m shares at 1p (Indonesia relaxed its ban on export 2014: it led to a circa 5% fall in Ni in one day)
November 01st 2016: RG subscribes to 62m shares at 2p. Transaction completes Dec, TR1 states 14.46% holding (up from 99m)
March 2018: RG related holdings reduce from 10.92–> 6.74% (60M shares sold)
23rd July 2019: RG reduces from 6.74–> 3.97% (40.5m shares sold)
Between these two events, there’s City Financial undergoing liquidation early March 2019, and going from 8.19% to 0. (120m shares which we were told bought by an intermediate who sold onto market over months). 120+40m is some 11%.
Some one here commented on RG selling, stating he was trying to buy into distressed Woodford sales. But he’s been a big holder since atleast 2012, buying at all prices 1-25p and inbetween, so the timing of the sale is still bit odd imho.
Anyways, I imagine it created anxieties for long term holders, and of course opportunities for entry at a bargain price. In previous annual reports, the Co comments on the 14.5ktpa scenario as a “base case scenario” ie smaller capital raise, achievable by a junior, and against the backdrop of lower Ni prices (14,000). The larger 29ktpa is described as the “option case” demonstrating project viability at a much larger production capacity, “should the company bring in a PARTNER to develop the project”. IMO this is looking more likely than not, and I wonder if it will further reduce the equity raising requirement. Getting Orion as a “strategic partner” is a coup for a co of this size imo
On the other side, Vermelho has high standard studies done by Vale, and all the data was purchased in the sale transaction. So all the hard work’s been done and we are told we can expect fast tracking. The high grade material at Vermelho is 18.1MT at 3.31% Ni. That’s nearly 600kt of high grade Class 1 Nickel. At the proposed 15-20ktpa project, that gives 30 years life of mine, before the rest is even considered (total resource 1.68MT Ni and 100kt Co). High grading ie prioritising the best ore to extract first, is often done by miners during lower commodity pricing, to bump up revenue. (Ex BHP at Escondida in recent copper bear) To be able to high grade in the midst of a Nickel bull market would be celestial timing assuming Ni continues it’s ascent. The best part here is that both projects are feasible at 12-14k pricing.
Contd
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