Member Info for Montmuzard

"Taking it to production and acting on the sinosteel contract is a material change and needs to be explained via an RNS"

What on earth are you on about? Nothing has changed on the website. You only have to look at the Wayback Machine from a year ago and the text on the homepage is the same. So either you don't realise this, or you do and you're trying to create extra volatility.

The company has always had a dual-track strategy: develop assets towards production on the operational side; explore strategic options on the commercial side. It's only in recent times they've suspended the former (at MT at least) while concentrating on the latter.

What is on the website is just the operational language that has always been there. There's no indication they've activated the Sinosteel agreement (although I'd be over the moon if they had personally).

You could a week ago, and the week before that, and the 50 weeks before that

"Hope some of you were buying rather than just talking about it"

I've been doing my buying the past 12 months while the negheads have been deramping. Now is the time for sitting and holding tight.

That shake didn't last long. MMs gathering ammo for next leg up. But they're not having any of mine.

"I didn't expect the board to RNS these milestone important things because their communication with shareholders is shockingly poor. It's like they see us with real contempt"

What utter nonsense. They've clearly taken a considered decision to engage in radio silence since the war began in an effort to stay well off the sanctions radar. This has meant only releasing information that is either legally required (i.e. annual report) or material in nature specifically in relation to the sale. Their PR team has even confirmed the latter in writing to some shareholders recently.

So, there are at least three potential explanations for the lack of an RNS today:

1. The DFS being published is not material. My view is that it is, particularly given the likely upgrade in resources, but the company is saying it is not, and perhaps they're getting around this because either they already mentioned a resource upgrade when the DFS was approved last year or by some sleight of hand they're defining "material" purely in terms of the sale. If the former, perhaps the very fact the DFS is in the public domain renders it immaterial (who knows?) but, if the latter, it is probably not a sustainable long-term position. Either way, it can probably hold for now, but not forever (and perhaps it doesn't need to hold forever).

2. Maybe they cannot comment on the DFS until the documents are actually downloadable or viewable, so they are waiting for some kind of further approval from the Russian state that they are indeed public before releasing a summary (and maybe for that they are waiting for the annual report at the end of the month, given they are only releasing legally mandated information).

3. Or all of this is rendered immaterial by the fact that a material offer for their assets is imminent, so the Nomad is happy for them to withhold information (perhaps is even advising them to do so) until that event (reinforcing point 1 above).

As far as I can see, only one piece of potential due diligence remains - the final resolution of the Queeld/Mispare case next week - so we could be looking at fireworks the next few days IMO.

I'm not sure publishing the DFS affects the sale directly in that way: surely any buyer has had access to the data room and will be well appraised of what's in it. More likely that the court cases are clearing the way for the sale IMO.

This is gonna be a fun last half hour

The time to buy was any time over the past 12 months - now is the time to hold. Rums all round!

If PIs were going to get "wiped out" here it would have happened at the start of the war. Eurasia have (a) a functioning mine at WK that can generate enough revenue to keep the lights on and (b) an ECPF agreement with Sinosteel that can be activated any time in the next three years. Nobody is getting wiped out.

@Monkey - I've wondered this too: "I am also of the opinion that the length of time this is all taking is down to have EUA2 (hydrogen?) up and running in tandem once or Russian assets are sold"

One of the typically cryptic comments a few RNSs ago - the one about wanting potential buyers to keep quiet until Eurasia was in a position to execute, not the other way round - implied this. Fancy that: imagine if we've waited all this time while a buyer has been desperate to sign but it's Dmitry who has kept them hanging!

"Clearly sold the stockpiled concentrate? Can you provide a basis for that comment or did I miss an announcement?"

It's fairly clear if you read the KK accounts.

"I still think the main issue with a company or asset sale is the availability of potential end users for product, companies that have imposed sanctions on Russian products, reduces the market place for the product which in turn reduces the price"

Last I saw, nobody had sanctioned PGMs, platinum prices are on the way up and palladium has bottomed out, about to start its rise up towards $1500 again by the end of the year.

"Your expectations are on the low side - you are factoring in an enormous haircut as well as a sales tax! I think a sales tax of 15% might well satisfy the authorities - but maybe only if something like fair value is achieved."

Maybe, let's hope so. To be clear, my 20p prediction is based on (back of a cigarette pack calculation) us achieving a reasonable NPV (which must be at least $3bn) with a full 50% haircut + 10% of remaining fee to the state x 80% for USD x 80% again for costs/taxes x 80% again for ownership share x 80% again to retain some money going forward, leaving 24p.

So, if you revise any of those figures upwards -- e.g. a strong DFS and rising PGM prices could see, what, $4bn or $5bn NPV (one NKT pit alone is worth $1.7bn), Artem might negotiate a smaller haircut, the USD might strengthen again against Sterling, the share apportioned to costs might be lower, the company might pay out proportionally more as a dividend, who knows -- then that leaves plenty of upside IMO.

If anyone wants to reminisce, the ACF Equity note from December 2021 suggested a fair value of £1.15-1.27 (!)

https://acfequityresearch.com/wp-content/uploads/2021/12/Eurasia-Mining-Plc-Flash-Note-ACF-Equity-Research-FINAL-20122021.pdf

"You were obviously a shareholder whilst the shares were trading around 40p, do you think they’ll reach those levels again or do you see them ultimately trading / selling for less ?"

I have no idea, and I've held all the way down from that level. Hindsight is a wonderful thing. I've got various outcomes sketched in my notebooks, and at present my lowest anticipated price is around 20p for everything and the highest goes up to 56p. My hoped-for price is somewhere around 44p but I'd be more than happy with low-20s. I know plenty of people are expecting less (10p-15p) but I personally just do not see that given the value of the assets in-ground and the time it has taken.

Thanks fellas. One other explanation, I suppose, for the ongoing mothballing - which could cast doubt on my optimistic reasoning - is that they cannot develop the mine due to sanctions. But three things would, in turn, cast doubt on this as an explanation: (i) the fact that the company have told us repeatedly that they are not affected by sanctions; (ii) the fact that, as we know, their metal basket is largely excluded from sanctions; and (iii) the fact that they have clearly sold the stockpiled concentrate, while doing an awful lot of work at WK, which implies that they can mine successfully.

So, I think it's clear that doing business in Russia is difficult in general because of sanctions, and they would rather stay as far clear of sanctions as possible so as not to get caught up in then, but I don't see that sanctions would be the explanation for not triggering Sino in the even that there was no deal on the table. Ergo, there is a deal on the table awaiting some kind of trigger to move to binding.

A final thought: with everything going on the Middle East, the polls are looking dire for Biden at the moment. This could change, especially if Trump goes to jail. But if I were a bidder with an in-principle offer awaiting a rubber stamp - particularly if that offer enjoys some kind of haircut and war discount - I would be getting quite nervous about the US election coming ever closer.

I've been here for getting on four years now and don't think it's a coin toss. That would imply it's a 50/50 likelihood of success/failure. I still see, personally, that success is considerably more likely than failure: at least 80/20, depending on your definition of success. Obviously nobody expects Hoochy's £3.50 but I still anticipate a decent return from this point, even with any haircut, and have almost trebled my holding over the past 18 months.

To my mind, short of expropriation - and the Russian state has shown no inclination to actually expropriate friendly companies - the outcomes range between a sale of assets of varying magnitudes, depending on offer prices and potential haircuts, and no sale, with the company then having little choice but to activate Sinosteel and starting to build the mine, which would only add value over the longer-term.

However, it is hard to believe that the company would have mothballed development for this long if they were not confident of getting a sale over the line. Which in turn begs the question of what might be holding things up. I can see two explanations: one is the due diligence requirements of any buyer, which in turn highlights both the successful DFS on Monchetundra last year and the recent court cases (i.e. the Kosvinsky Kamen tax one and the Queeld share certificates one); another is negotiations with the state on acceptable sale prices and haircuts.

It's fairly obvious now that the court cases are almost resolved (and, moreover, resolved in the company's favour) so surely it stands to reason that this should remove a final obstacle to a binding offer materialising. Indeed, some people have received communications from the company's PR people that they will now only update shareholders in the event of a material change. What other material change could there be, in such a period of enforced silence, than a binding offer? If the Russian state is then the second obstacle, my view is also that a big part of Artem's role has been to quietly prepare the ground in advance to smooth the transaction once that offer does indeed arrive.

EUA will never go bust: they're clearly mining again at WK and that will be generating enough money to keep the whole show on the road for as long as it takes to get the asset sale through. Even in the event of no asset sale, they still have the Sinosteel agreement for another 3 years which can be executed at any time. Nice try though, green coffin crew.

Who on earth is ramping? Close reading of the company's RNSs tell you what's going on behind the scenes. They're negotiating with multiple partners under NDA to agree a sale of their Russian assets.

the fact that any haircut is based on value of assets, not offer price, could work in our favour. just one nkt pit has an npv of $1.7bn, so add the second, then loipi, nittis, trav extension, something for the nyud entitlement, then wk. then consider that the dfs upgraded (by how much we don't know) the resources, meaning we could be talking as much as $5bn on an independent valuation.

but let's say $3bn or £2.4bn: halve it for the 50% haircut (£1.2bn), 15% exit tax (£1.02bn), times by 80% to get eua ownership (£816m), another 20% for fees and taxes (£652m) and then 80% as a special divi = £522m with another £130m retained in the company.

so, on this back of a *** packet calculation, that's a divi of something like 18p/share. however, any of those figures could be revised upwards: we might not pay the 50% exit tax (or all of it), the valuation might be considerably higher than $3bn, the board might not want to retain as much money going forward for eua2.

plus, my hope is that artem was brought in for precisely this reason: to persuade the russian state that eurasia should not have to pay the full exit cost, on the basis that they were already selling before the war, they've been a friendly company that has worked hard to bring these assets to production when nobody else wanted them (for 25 years) and by far the best way of encouraging junior exploration in the country once the war is done is to let a small explorer get their bonanza.

so, a possible ten bagger from this point, with significant potential upside? i've got some dry powder coming in this week and will still be buying.

"And how could he have sold at the peak?"

He couldn't, and that's the point: it's not a lifestyle company.

A lifestyle company where the chief M&A officer, who is also the largest shareholder, is effectively working for free and didn't take the opportunity to cash out at the all-time high? Very odd lifestyle company if so.

Anyway, I made a nice little trade on HE1 today, and now have 1.25m Eurasia shares. Still very confident of a happy ending. Rums all round!

Booked reserves are 4400kg but they already anticipate that increasing to 6400kg on existing data. Plus, they’re obviously not going to get to 64k/oz immediately. It’s a target. You seems to have missed off the bit where they expect the entire district to have 21.6 tonnes eventually: that’s almost 800,000oz, which is where the long-term 64k/oz target comes from.