Member Info for observer842

;-)

Easy @MBW. It wasn't small...

LoL @MBW, duodecupling was so 2020. quindecupling is where 2021 is ;-)

Indeed @Bannor. Never has high risk, high reward been more true. :-) The big one could land at any time...

But look what they did with their options beforehand - red signal to me.

I guess everyone views options differently. At this time I can't see the BoD recommending an offer for KDNC anywhere near their issue price. That's the point for me, and why I'm very happy to add below them :-)

Although a little lagging at the moment, this link I posted a while back shows the "problem".

"Dry Bulk Market Index(BCI/BPI/BSI/BHSI"
https://www.kline.co.jp/en/ir/finance/shipping.html

Indeed @Bannor. It was great that DEV managed to get 3 or 4 ships sailed with their ore netting $10m before iron ore came off the boil and ship rates rocketed. Makes complete sense to continue to ship third party ore at this time. A large portion of that $10m is going towards progressing the project, towards the PFS, which will go a long way with current exchange rates: R$51.59m :-)))

Indeed @tomcat: "the deal is done… completion is imminent…".

What amuses me no end is those who think it is months away, and continue to think it is months away, despite thinking it was months away months ago, will continue to be proven right everyday it isn't completed, but will be ultimately wrong when it actually matters - the day it completes. Whereas those who think it is imminent and has been imminent for months, will continue to be proven wrong everyday it isn't completed, but be ultimately right when it actually matters, the day it completes. It really puts a smile on my face thinking about their inability to grasp this. lol. ;-) The deal may be days, weeks or months away, maybe even next year. We don't know. No one does. But what we do know is that it could land any time, today even: this makes it imminent in my eyes, but I'm more than happy for others to believe to the contrary, it's what makes a market. :-))))

lol @Dallas, all things are possible. It sure will be interesting to see how this plays out over the months and years, not days and weeks as unlike the possibility of the Amapa deal closing, I'll be surprised if an offer for our JV's is imminent! ;-)

"As far as the Company is aware, the Possible Offer has no direct effect on our joint ventures. Should the cash offer be successful, it will be highly encouraging for the development of the project, given Ganfeng's involvement in the development of the asset to date, their extensive experience in the lithium market and the fact that their holding company is the world's third-largest (and China's largest) lithium compounds producer."

Thanks @bigdouble. Because of the following I'm assuming that until we hear otherwise all ore shipped by DEV is part of other commitments, and not DEV's. The project is still progressing and presumably profitably making these shipments ;-)

"Interim Results for the six months ended 30 June 2021" (26 August 2021)
http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=311428214199398325
===[
As of the end of August 2021, DEV had shipped three cargoes totalling approximately 143,000 wet tonnes of 58% iron ore. DEV is also contracted to carry out logistical and shipping activities for third parties who have stockpiles held at DEV's port, which it has been doing since it completed its third shipment in May of this year. These third-party stockpiles are separate from the 1.25 million tonnes of 58% iron ore (+/- 10%) owned by DEV. At this point, DEV intends to continue to carry out these shipping activities for these third parties. This is because current shipping rates have increased dramatically (US$80-90 per tonne), which is reducing the profitability of shipping DEV's material. We believe that these rates should normalise over the medium term; therefore, the shipping of DEV's material will recommence at a later stage.
]===

lol. Alternatively: "1. The value attributed to the existing issued and to be issued share capital of Bacanora is based upon 384,144,901 Bacanora Shares in issue on the Last Practicable Date and 2,991,601 exercisable options.".

I think I see what you are trying to do now, but it doesn't feel a good way to estimate the value of the Sonora project to me. Better to use the enterprise value IMHO, as this discards cash on hand etc. Regardless, at least you arrived at the same valuation based on the defined reserves as me - £100m ;-)

And not to mention increasing Lithium prices! :-)))

https://www.lme.com/Metals/Minor-metals/Lithium-prices
===[
FASTMARKETS MB LITHIUM HYDROXIDE MONOHYDRATE: MIN 56.5% LIOH2O BATTERY GRADE, SPOT PRICES CIF CHINA, JAPAN & KOREA, $/KG)
(MIDPOINT)

DATE PRICE (US$ PER KILOGRAM)
26 August 2021 16.50
19 August 2021 16.25
12 August 2021 15.75
05 August 2021 15.75
]===

What's your 273m @tomcat? Number of shares? According to: "Ganfeng currently owns 50 per cent. of the Sonora Lithium Project directly and is also invested in 110,933,697 Bacanora Shares, representing approximately 28.9 per cent. of the Bacanora Shares in issue as at the Last Practicable Date, and is Bacanora's largest shareholder." there are 110.9/0.289 = 383.7m shares in issue.

lol @Bannor I know you are only partly teasing, and @EV has partly addressed the tease, but another aspect on valuations and sales which I don't see mentioned that much on chat boards is the point that if both a buyer and a seller did happen to agree that a (part of a) project has a particular risked NPV, say $200m (£145m) it makes no sense for the buyer to purchase this for the full $200m, as they themselves would then make overall zero profit from the transaction. i.e. in principle you can't command the full NPV of a project on the sale board, it simply doesn't happen, unless it's not a true estimate of what the NPV would be post sale, and what you are buying is the potential for a much greater one, for example through expansion or expectations of higher prices, lower costs, improved efficiencies, synergies, etc, etc. So if @Kiran did once suggest our JV's were worth £150m or so TO US and he still thinks this is a reasonable valuation (we have no idea) we might be lucky to have it taken off our hands for the Ganfeng BCN valuation on a reserve basis of £100m, but more likely less IMHO, perhaps much less, depends on the strength of our hand, and how desperate Ganfeng want the JV's I suppose, but hopefully significantly more than what surely has to the floor based on the 17.5kt/35ktpa plans! Perhaps we'll meet in the £50-70m middle? Though as I mentioned, I'd prefer we held on in some form or another if at all possible. ;-)

Indeed @Bannor. Though I'm sure most here will be happy to let our JV's go for more than £100m at this time, which is approximately the value the offer places on them on a reserve basis, I don't think anyone will be in any doubt that Ganfeng will try to take them from us for a fraction of this if they are able to. No doubt their opening hand, as appears to be the case for the offer for BCN will be based on existing plans, something along the lines of: "we only plan 17.5kt/35ktpa for 19 years, which includes 3.6% value associated with your JV's. We valued BCN's 48.2% at circa £230m, therefore your 3.6% is valued £17m. How does £20m sound for the lot?" Upon which we should reply. "We'll tell you what, if you aren't planning on mining more of our JV's than presented in the 2018 Feasibility Study we'll accept your offer of £20m if you sacrifice to us your 70% ownership of the areas you don't plan to mine. There're worthless to you right?" ;-) lol.

Personally I hope we are able to come to an arrangement whereby we are able to hold on to the JV's in some manner as I'd expect significantly more value than £100m to flow to us over the next decade associated with their areas, even when discounted to the present, as there is no doubt in my mind Ganfeng plan to expand way beyond 17.5kt/35ktpa in short order - which requires the JV lands. :-)

Ob.

@Ob: "Two more named ships for DEV on pier 2 - UT & L". Now back to unnamed status, possibly because cabling now planned to take longer?

Found the two links I was thinking of which suggest we'll be able to use Panamax size ships at the private and public ports in time.

"Operations of larger ships in Amapá are simulated at the University of São Paulo" (4/8/2020)
https://www.diariodoamapa.com.br/cadernos/cidades/operacoes-de-navios-maiores-no-amapa-sao-simuladas-na-universidade-de-sao-paulo/
===[
New port operations in Arco Norte may receive the seal of the Brazilian Navy and boost cargo handling capacity at the port of Santana by 50%.
...
Another pilotage investment was the sounding of the surroundings of Ilha de Santana, in front of the port, which indicates the possibility of a route for the arrival of large bulk carriers. Today, vessels of up to 203 meters in length (Handysize) make the turn in the evolution basin to dock, but the area prevents the maneuver of larger ships. With the new route, the ships will already enter in line with the port's berths, dispensing with the turn in the basin. This will allow the entry of bulk carriers in the 235-meter range (Panamax), with two more cargo holds, bringing significant productivity gains.
]===

"Agência Amapá participates in the approval of PANAMAX ship at Santana Docks" (August 31, 2020)
http://ageamapa.ap.gov.br/noticia/3108/agencia-amapa-participa-da-homologacao-de-navio-panamax-nas-docas-de-santana
===[
The operation marks the beginning of a new era for international logistics as a strong driver of Amapá's Economic Development.
...
Agência Amapá, represented by the Director of Investment Attraction, Tania Muricy and the Mining Coordinator, Wagner Costa, participated last Saturday, 29, at the invitation of the President of Santana Docks, Glauco Cei, in the berthing operation of a PANAMAX vessel at the Port of Santana.

The new operation will place the port of Amapá in a differentiated position and ensure competitiveness in the market, as the State moves from the average operation with ships with a capacity of 45 thousand tons to 70 thousand tons, representing an increase of 40% more cargo to be exported.
]===

Some good spots @EV. We also know that recent water surveys suggest that larger vessels will be able to pass through the ports as they won't need to turn around. Anyone got the link to this news?

It was possibly mentioned in the local press or in interviews as opportunities for the future (including doubling the shipping rate!). Perhaps long memory @Dallas does? lol. Either way, I don't see why it wouldn't be on the table when we are producing at full rate in a few years from now, and especially so if shipping rates remain high.

In this thread @MBW. In summary:

"Zamin Ferrous presents construction schedule for Amapá state's first steel plant" (January 11, 2013)
https://www.bnamericas.com/en/news/metals/zamin-ferrous-presents-construction-schedule-for-amapa-states-first-steel-plant
===[
Jersey-registered Zamin Ferrous has presented the government of Brazil's northern Amapá state with a US$120mn plan for the building of two blast furnaces, the company's inaugural step towards the construction of Amapá's first steel plant, local press reported. According to Zamin's schedule, the steel plant's deployment will occur in two stages. In the first 18 months, the company will invest US$60mn to build a blast furnace to produce pig iron. The construction of a second blast furnace, aimed to produce steel, is scheduled for 12 months later, with an investment of another US$60mn. The steel output from Zamin's Amapá plant will be used in the production of agricultural machinery, appliances, automobiles, construction, mining and smelting. IRON ORE On January 4, multinational resource group Anglo American (LSE: AAL) and US-based Cliffs Natural Resources (NYSE: CLF) agreed to the sale of its Amapá iron ore system, in northern Brazil, to Zamin Ferrous, an Anglo American press official confirmed to BNamericas without disclosing details. Sources familiar with the matter said the entire mine was worth about US$300mn. However, an internal valuation by Anglo American last year put the value of Amapá at US$1.5bn, the Financial Times reported. ZAMIN Zamin acquired local iron ore miner SUSA Mineração in 2010. In Brazil, Zamin also has the Greystone iron ore project in Bahia state where the production target is 8Mt/y, and the Zamapá project in Amapá state where output is also set at 8Mt/y.
]===

"Zamin – Macapa Steel Processing Plant – Amapa Project Profile" (March, 2017)
https://www.marketresearch.com/Timetric-v3917/Zamin-Macapa-Steel-Processing-Plant-10924619/
===[
"Zamin – Macapa Steel Processing Plant – Amapa Project Profile" contains information on the scope of the project including project overview and location. The profile also details project ownership and funding, gives a full project description, as well as information on contracts, tendering and key project contacts.
]===