Seems that DW is spot on when he says drilling Charlie 1 will be a pivotal moment, and just after that "we enter into this critical phase". Still huge potential here, but with not getting full uptake on the placing this time and you have to wonder what we'll be able to raise next time if we have another unsuccessful well.
But its already been proven that there's oil where we're drilling charlie 1, we just need to get it to flow. Success here could change everything.
And must admit I'm not particularly enthused by the further mention of new opportunities on the north slope. Always seen previous lease additions as positive, but do feel we're at the stage now where we shouldn't be looking to take on further costs and risk before we make some progress.
Jiddy, 66m is the population of the UK. 17.4m is not a majority of 66m, and the MPs have a duty to represent everyone, not just a minority.
As I said, I think best to not have a brexit debate here. If parliament can't come to an agreement, I doubt we can either
10.32 - That could be a reason for the fund raise, rather unknown at this stage. But the $23m price tag on Charlie is significantly more than Winx. Both wells designed to target multiple horizons. The plan for Charlie is also for a horizontal drill later on, so perhaps that's where the extra cost is coming from, but the depth and targeting the HRZ for pressure cores could also be a big factor in the additional cost.
I don't think we should get into a brexit debate here. It would be just as valid to say that 17.4m is not a majority of the 66m people the MPs are representing. So I think we should stick with 88e discussion :)
Jiddy, I wouldn't go as far to say we rejected cash from PMO, there is simply nothing to confirm cash was ever on the table.
But we do know from the drill that PMO are funding will also be targeting the HRZ, which is a target not included in the farmout. So they are paying for us to get data to help prove up the HRZ which they won't benefit from. Perhaps this was a redline from DW, and he took that over cash to get that data and avoid giving away a share in the HRZ at this stage, but we just don't know for certain.
If it works out, that data for the HRZ could end up being worth a lot more to us than any cash we might have got from this farmout, even after taking the placing into account.
After we announce the audited accounts for the financial year just finished I think we'll start to get a lot more coverage. (If as expected those accounts show we've finished the year with our first annual profit)
More commentators and analysts will start to notice at that point. It won't take long for them to piece together:
- currently in profit, +
- proven low cost/risk production +
- more earnings streams started and ramping up since year end +
- Kabwe production about to start
Yes he did appear to say that PGMs were battery materials. Maybe a mistake from someone who doesn't really know what the metals are used for, they didn't really seem to know what vanadium is either.
But to give him the benefit of the doubt, he may not have made a mistake, amplats is actually developing a battery that uses platinum:
Miloh, oil & gas is about 8% of the US GDP, largely due to fracking (about 60% of US oil is from fracking). Does anyone really believe that any politician is going to remove such a large proportion of the GDP from their economy? It may sound good on the campaign trail, but reality is very different.
9.05 - Yes I noticed that as well. It seems a little odd to me for that to be thrown in because the amount we're raising is not huge, but looks enough to cover cost commitments into next year after the drill results. I can't see that there'll be a lot left over to go after something else and have funds to do anything with it. Only thing that could be a viable option for us at this stage is something like the deal UJO got on west newton, with a small stake for little cash in someone elses drill that is ready to go.
Everyone knew cash had to come from somewhere after the farmout didn't include a cash element, so its not really surprising.
Dilution and placings never ideal, but now its out of the way we should be able to move forward after the initial drop by MMs to the placing price.
Fully funded drill, company fully funded until well after the drill results, and possibility of other news in between such as tax credits being paid, HRZ farmout starting, maybe even a Yukon farmout starting.
Could be good news for us, a ban on new leases would see existing leases become more valuable, and we have plenty of leases.
As for a ban on fracking in the US, the realisation of a near instant major reduction in tax revenues from oil and the voting public facing rises in petrol prices would give the politicians 2 reasons to have a quick change in policy.
Seems that its only two companies involved in the wage dispute and possible strike action, amplats and sibanye, so shouldn't affect us in a negative way. Could be that its a sign higher wages across the sector will be pushed for, which will increase mining costs and end up resulting in cuts to production.
But since we're not mining then its not such an issue, and any cuts in production elsewhere that lead to reduced supply could end up benefiting us.
I'm not sure what that would achieve rfarfa, I'd expect the only response DW would make is to say that information on the company's finances is a matter for regulatory announcements, which he complies with.
My thoughts as well TBTT. There's been no mention of copper tailings from LC, which leads me to the view that we're more likely to be processing fresh ROM ore. And after all, that is what Sable was set up to do, and it seems we're just using the existing plant for copper.
Since most/all large operations will likely have their own processing and refining facilities or existing agreements for processing their ore, I think we can assume that the source will be from multiple small scale mining operations. Therefore I'm not really expecting to have any RNS to tell us the source, just the same as Windsor, where they've obviously come to the view that its not RNS worthy to detail all the sources of ore being processed.
If those forecasts for materials needed for car batteries come true, there will be other knock on implications. Only a month ago large parts of england and wales had a major blackout because of a pretty minor issue with the power supply. With a big increase in demand from ev's those problems could just get more frequent, and I doubt the UK is alone with needing to upgrade power grids to cope.
Increased demand for copper to upgrade power lines could be one effect. Maybe large scale vanadium redox batteries will increase further to enable greater storage of energy to cope with the demand. Maybe there'll be a greater and faster switch to fuel cells if the power grids can't cope.
So whatever way it goes in the next couple of years, having copper, cobalt and vanadium to add to our PGM portfolio looks good for the near term future.
DW has consistently said that we have parties interested in the HRZ, but a big unknown is whether those parties would still be interested if we'd farmed out part of it with the conventional to PMO.
We'll probably never know the full details of what bids were made or the matters negotiated on. It may be possible that in the short term we could have got a slightly better deal for the conventional if the HRZ was included, but then we wouldn't be able to farm out the HRZ separately. And so longer term it may not have been a good deal that maximizes the value.
It seems to me that this is still very much a case of wait and see, which is where people get frustrated. And it does appear to me that there is a lot of new information on the HRZ that hasn't yet been released. Most notably the revised fairway and revised resource estimates.
They must have a fair degree of confidence that the revised HRZ fairway extends under Charlie 1, and have got PMO to pay for drilling to that depth as part of the deal. That would appear to be an additional cost to PMO that they will not benefit from, and so we must have a very good reason for that being part of the deal over something else that we might have been able to get from the deal.
Brom 9.23 - Re splitting WI rights on acreage, there's been a recent example of a similar thing with the proposed(rumored?) shell acquisition of Endeavor.
In that case the transaction was expected to be around $15b, but the founder of Endeavor wants to retain some rights for undeveloped oil on the acreage. So valuation reduced to $8b.
Not entirely the same situation as us, but the principle looks fairly similar. In our case, the retaining full ownership of the HRZ underneath the conventional could be comparable to the Endeavor founder retaining some rights when he sells the rest.
But I should imagine any deal of this kind would require some fairly complex clauses to clearly define what is and isn't included.
Johan, yes platinum is traded on etfs, and just like all commodities it’s price moves up and down daily as it’s traded.
Share much the same thoughts for charting on small cap companies without huge volumes, but feel it’s far more relevant to commodities where there will be a lot of trading decisions based on charting and trends. Seen a few articles recently that give a similar resistance level for the platinum price, so it is possible if those levels are broken it could go on quite a bull run.
Just my thoughts of course, I’m by no means an expert on charting and don’t pretend to be!