Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Don't worry Zan, thought the same as you until I noticed the same percentage as yesterday! How extraordinary that we are down in price, no real press comment and no chats worth mentioning today either after a stunning better-than-doubling confirmation of the resources at LS! What will it take to get this stock on any radar screen, let alone a wide one?!
Dave: Redcorp is the Portuguese holding company of LS but not a drilling company. I am not an expert but I do not imagine third party drilling, assaying, geos, mineralogists etc come cheap. One might guess at least $150-200k/hole to have been spent on 10 holes, a significant investment. A good part of which was perhaps provided by MAFL (as THC was a minnow with net assets of only CHF64k in the Aug 15 RNS). As u69 says, unlikely to be more drilling as neither THC nor MAFL are exploration companies and they have said they are looking for a buyer. Reasonable to imagine that a sale will also somehow reflect the "unexplored value", which undoubtedly exists. GLA
6z: Undoubtedly, there is now a whole raft of almost exclusively positive facts with which to strike a good - and profitable - bargain!! It has often been said here that only a sale will enable the market to put a value on this share. It will be interesting to see if any commentators pick up on today's RNS, these muted responses are so disappointing!
A short RNS but with lots of important data. The total site is 13,000 hectares, so more ore below the 300m drill depths and outside the drilled areas ("There remains significant exploration potential below the known deposit, additionally the deposit is open to both the south and to the east") No values are placed on the resource yet. Any valuation now can only be based upon 'in the ground values'. Indicated and inferred gold alone is worth $256m in the ground (one can do the sums on the other ores which are in much larger quantities) The recovery rates from the previous RNS were exceptionally high but are not addressed here, although it may be an input to the upgrade. The commercial viability of the resources is not addressed but is likely implied from the gradings and this now being the "third largest" Zn-Pb-Cu known resource in Portugal I know lots of excitement here over Indium and Selenium but IMHO those are "icing on the cake" All this leads to the final long-awaited step of a purchaser being found. He (and JV's negotiating skills) will take account of all the many positive factors and an offer will put a value on the LS resource and MAFL's interest in it (which itself can be expected to be clarified, given its role in financing and steering this exploration). It may not be a straightforward sale announcement, however, given the further exploration potenatil
U69 is right about the additional discovery of tin - and the most recent RNS also explained the delay: "A resource update is expected to be released shortly. The results partly delayed pending the completion of these mineralogical test results, which will be incorporated into the resource update document..." The mineralogical tests, though technical and boring, were important in determining the amount of minerals which might be recovered from the ore. One imagines this should enable a better sale price to be negotiated. I feel sure the resource update will indeed be out "shortly". GLA
6z: You are quite right, the most recent reports and 'numbers', including the upcoming resource update, will have been produced with the primary aim of optimising the saleability of the LS resource. That is the immediate endgame and we should perhaps not read too much into a relatively brief distillation of technical and no doubt lengthy reports. Let's by all means see what the update produces but it is the sale details which interest me and which will hopefully excite the market. GLA
Feel sure the resource update will be out shortly, based upon last week's RNS which sort of explained the delay: "A resource update is expected to be released shortly. The results partly delayed pending the completion of these mineralogical test results, which will be incorporated into the resource update document..." GLA
Suspect price has dropped as some big sells have gone through over last 2 days, although others have reported here their buys are being reported as sells. Confusing but on balance likely more sells than buys. Also despite yet another helpful, positive RNS, the RNS is not widely seen/understood as such, just as many other good/excellent RNSs have been received with a price drop! A better understanding of what MAFL is about and what LS means to it is needed, helped by some good PR. All hopefully will become clear with imminent resource update followed by a LS sale offer. GLA
Wents, you are right that this was a technical and seemingly boring RNS but actually very important in answering one of your questions in terms of what is recoverable. I read it as pretty good recovery rates on much of the ore with low penalties for contaminants such as arsenic. All we need now is the resource update which must be imminent. You’ve seen a series of first class drill results so 50:50 seems a bit negative. We also know prospective purchasers around. Patience as ever. GLA
6z, Ma5k: Whilst it is undeniable that any LS sale must be by THC or its wholly owned Redcorp sub, I believe MAFL has provided much of the financing and expertise for the 10 hole drilling programme (which cannot have been cheap) and so borne a lot of the risk/effort. I speculate that one might expect some significant additional benefit to MAFL for that key role but I do not believe we have had details. Others have voiced similar thoughts. I would expect all to be clarified when sale is announced.
Marineville: I feel sure that the report which has just been released and the upcoming resource update must be primarily aimed at improving the assets so as to get best price from a purchaser. The notification of shareholders by RNS is a legal requirement for transparency, not to ramp the sp. The event which we expect to really mark a turning point for MAFL will be a sale announcement for LS but even then, I think it is unrealistic to expect the company to say this is a "share worth buying"!
Nom: I agree its pretty complex but it seems very positive with more upside surprises, e.g tin. Whilst today's RNS is not the updated resource estimate we are awaiting, my understanding is that it addresses the proportions of the minerals which might be recovered from the different rock/soil layers encountered, so that would surely be highly relevant to the economics and so to anybody considering purchasing the property.
I don't think a buyer is going to require all 17 anomalies to be explored if the primary resource which has been drilled is sufficiently attractive. But given the uncertainty of what lies in the unexplored zones, would it not make sense to both seller and buyer to look at ways for that resource to paid for in the future by way of extra consideration (something like a royalty would do the trick)?
Shakey: You are quite right. I wonder if the difficulties in modelling this resource update, with its multiple minerals, different concentrations, yield considerations, faulting of the geology and angled drilling - plus of course the constantly changing mineral values - may not be contributing to the delay. Nonetheless, all that could be nothing for an experienced geo! Sure we will see something soon. Happy New Year everybody, minerally and personally.