Member Info for RichKen

steel prices, a weaker South African rand or both.
Vanadium deficit: Vanadium remains in structural deficit in the market according to Bushveld supported by 2.5% compound demand growth from steel and chemicals and potential for CAGR growth of up to 8.4% driven by vanadium redox batteries.
Vanadium prices have fallen this year due to China’s failure to fully implement its new standards on vanadium content in steel rebar. The result is that many smaller steel mills are still making brittle steel by quenching and tempering which is not good if corroded or unexpected strain is put on its reinforced structure.
Chinese officials are being punished for failure to implement government policies and we expect more officials to move to impose standards rather than risk several years in a correctional facility.
We have adjusted our model to replace our forecast $150m expansion at Vametco with new and less capital-intensive production from Vanchem.
While we suspect management will be busy restoring production at Vanchem it is possible that Vametco could also expand further in time if the supply deficit widens and prices continue to support additional supply.
This is good news for consumers as it offers the prospect for an additional vanadium supply into a market which could potentially see longer term constraint as banks may struggle to finance many other vanadium projects.

Comparing the Vanchem acquisition with the original Mokopane PFS shows the Vanchem deal to work better on virtually every metric and critically the deal serves to simply take over and replace Vanchem production which was lost to the market last year.
Our new Mokopane/Vanchem NPV is better at US$487m vs US$418m in the 2016 Mokopane PFS assuming a 10% discount rate and our IRR is at 66% vs 24% in the 2016 PFS.
Chemicals: Vanchem is a large chemicals business focussed on vanadium chemicals and products. It has multiple product streams and lots of big kit for spare capacity. It is also well connected to Vametco and Mokopane by rail and road which gives increased flexibility in its operations and potential for create for more value-added products.
Cheaper acquisition: Vanchem is a significantly cheaper acquisition on a per tonne of capacity basis than the Vametco deal due to its distressed state, need for feedstock and capex requirements.
The capital intensity of the Vanchem deal is around $17,000/t of V2O5 on our figures vs around $31,000/t in the Mokopane 2016 PFS.
Production is currently running off just one of three existing kilns at Vanchem and the new $45m capital program to restore production over the next five years is seen by management as relatively cautious.
The plan allows for existing production to continue while refurbishing capacity which was recently mothballed for lack of feed. Hopefully reality will be faster given the presence of so much infrastructure at site.
Replacing lost capacity: The strategy simply replaces vanadium production which was lost to the market after Highveld closed and should have little impact on vanadium prices.
Highveld Steel closed in 2016 left for dead by Evraz, its Russian owner which cut around 1,800 jobs in the process. We have seen reports suggesting the plant may reopen sometime though this may require higher steel prices, a weaker South African rand or both.

So SP Angel are valuing Bushveld Energy at 3.6p per share. This has significant upside. No kidding! This is likely to have a valuation higher in time than the vanadium part of the business. Fortune and Mikhail have said many times that the revenue from Bushveld Energy could be 10 times that of the vanadium mining and process business.
One might just say we are significantly under valued!

Vanchem acquisition for $68m cash adds real value due to its combination with Bushveld’s nearby Mokopane project which can supply much-needed fresh ore to Vanchem.
Vanchem technically has capacity of 5,000mtVpa but currently produces just ~960mtVpa.
Capex est. $45m to restore capacity plus $20m for new Mokopane mine construction.
Our new Mokopane/Vanchem NPV looks good at US$461m, IRR strong at 63% due to low capital outlay and faster production growth on 10% discount rate.
Vanchem currently in business administration due to lack of own resources and feedstock from closure of Highveld steel in 2016.
Production running off just one of three kilns at Vanchem.
Low-risk expansion using existing kilns, and equipment, simply replaces lost production.
Vanchem’s vanadium chemicals business helps diversify sales while the increase in production still leave scope for further expansion at Vametco.
Valuation: We have reduced our assumed vanadium price to $60/kgVfor 2019 and 2020 due to lesser compliance with the new Chinese regulations than expected, though we do expect punishment of Chinese officials to create better compliance this year. Vanchem acquisition offsets our assumed lower vanadium prices.
Our revised target price valuation rises to 90p/s from 87p/s previously.
Energy Tech: Bushveld Energy initial valuation as sales of Vanadium Redox Flow Batteries ‘VFRBs’ to ESKOM and others draw closer. Higher vanadium production give potential to significantly expand VFRB electrolyte sales. We value Bushveld Energy at 3.6/s as an initial starter valuation though the business should develop significantly greater value in time.

Hi Numpty5,
I think the answer to your question is not one any of us can actually answer. I think Fortune and Prince will now the right time. I think the key is when it offers us the best value. That may tie in with the moment we need to fund phase one of the Mokopane Greenfield Processing Plant - that would be good for all of us. Again it would be the deal on the century. He is a canny and shrewd man and I am more than happy to wait for this.

I am not sure if many on here would agree with this. Clearly having a coal power project is at complete odds with the rest of the business. But it is a means to an end. It brought us Brits, and it will create a huge capital intake. Plus to be fair it will create a huge amount of jobs in Madagascar and power for many which will set that country for a future. I just hope they put VRFB in there somewhere and an opportunity for solar/wind back up to leave a slightly green footprint. Not sure if that will help but there you go.

End of 2021 may be the right time? But Fortune is the man.

Cheers, RK

Highly likely BMNfan!

Not latter than Thursday! Expecting so very interesting updates.

The biggest news item which will awake the market could be very well timed after these incredible updates. That is confirmation of the profits our company is making. Once the large institutions get this in their hands with the story so far I think we can expect fireworks. That news will come with a dividend policy. It will also likely include the JSE listing notice.
Fortune has made much and rightly so that Bushveld Minerals is a South Africa story and allow the people and large financial business in SA to buy in to a company that could be one of South Africa’s biggest success stories in a generation will have I am sure a phenomenal impact. The timing as Fortune often has proven could be perfectly executed. New strong government, no corruption, humble but impeccable leadership and huge employment potential in an industry which could transform Africa.
I think 2019 will be transformational, it already has more seeds sown than is needed for a bumper crop.

This story is still not half told.....

But we are here as active investors. Exciting times my friends.

Here’s to another good week!

Thanks Mrremmy!

You are right the long term potential is incredible and huge. The fact that our CEO is getting invitations to speak on one of the worlds largest news media channels, shows how far the publicity side could go. Right now the environmental impact discussions on global warming / climate change / enviromental changes is huge news and the unlocking of renewable energy in conjunction with reliable, safe, long lasting and recyclable energy storage which Vanadium ~Redox Flow Battery technology gives is beyond our comprehension as a market. Its focus is on large applications, but it could easily be used for home energy storage and two examples are already around. With cost-effective electrolyte the Baby VRFB with a 20 year plus life would be very interesting market. Given the choice of a fire risk and short life 10 years or less with Lithium Ion against a 20 year plus for VRFB the potential is very encouraging. All we need is the cost of solar tiles to reduce and for them to become the default tile for buildering companies and the market will be there. This alone could be massive.

Fortune and Mikhail have together brought the global vanadium market a very special combination which many around the world will want to imitate as time goes on. They are the pioneers and Bushveld Minerals is about to go to the next level. The points made by Middle East Money, I agree with. In the past i have been somewhat lambased for tihnk that this company could be a really big company. But to be honest I really do and long term as this company really dominates the vanadium world as it will with its enviable resource. I expect to see a very long term future with a very strong stock price and substantial dividends. The dificulty most people have is that BMN is listed on AIM and it is based in South Africa. Well AIM is a junior market and we may not be here for long and South Africa just so happens to be the place in the world with the largest Vanadium resource. Imagine back in 1920 if you had said invest in an oil field in Arabia. Who is going to find oil there in all the sand. Who is going to want to leave in that heat? The point is things change and even in countries where things don't look good today, things can change and things do.
Once Great Britain was the superpower, now we are well down the list due to poor leadership and lack of vision in our recent governments. In the end our growth story is down to being in the right place at the right time with the right market and with all these points you can guarantee success.

Bushveld Minerals has all these points in place. Tomorrow we have another chance to learn more about the VRFB market with another webinar and more publicity. We are likely to get more news from Vametco very soon with Q1 update and I feel much more about what the plant plans to achieve in the year ahead.

Right place, right time, and this company is massively undervalued!

Part 4

These thoughts may help unlock some consideration of where this company is heading. In the end, the speed of the market and the global economy can change many things. But, one thing is very clear, there is a market opening up for energy storage. Vanadium right now looks to be the ideal mineral to unlock the potential. This gives all investors every reason to evaluate the opportunities which may well be unlocked as the company proceeds. The company may have to accelerate its growth, or it may hold it back depending on opportunities and global uptake in construction and energy uptake. Please do your own research and only invest what you can afford to lose or feel comfortable with.
For more research and presentations by the company see:

http://www.bushveldminerals.com/presentations/

I hope this is helpful to all investors and those interested in Bushveld Minerals

Cheers, RK

Part 3
Bushveld Energy have one last potential revenue stream. The electrolyte is a large part of the cost of a VRFB, so to help purchasers of the technology the Vanadium Electrolyte is likely in most cases to be leased. Bushveld Energy see this as an excellent on-going revenue stream (note a VRFB has a life of 20 years more than double the live given by Lithium Ion battery manufacturers). Both Fortune Mojapelo and Mikhail Nikomarov have said that the Bushveld Energy business could have a value of 10 times that of the Vanadium mining and process business. This market is predicted to grow and grow as the world finds ways to go away from carbon-based energy production. Initial electrolyte production is based on 200MWh which needs 1100 mtV, the plant will easily be expanded up to 1000MWh which using todays technology will require 5500 mtV. This will easily be the largest vanadium electrolyte plant in the world. But, it could grow much more than this and with the Bushveld vanadium inventory it is easy to how easy it would be!

http://bushveldenergy.com/company
Where will the stock price be going?

This brings me to the second question – What do we think the stock price could appreciate to in 5 years time? This is one of the most difficult questions to predict. But, given in 5 years time we are likely to be producing 10,000 mtV per year at circa $65 per kilo (estimated) with an operation cost of around $30 per kilo for the vanadium this would generate $350 million in profits (of which Bushveld would take 75%, due to the BEE policy in SA). Leaving $262.5 million. Assuming that 5500 mtV of this will be purchased by Bushveld Energy and turned in Vanadium Electrolyte which is likely to be at least 50% higher in cost than the FeV price could bring $479 million in profit to the business. This kind of operating profit is huge and this will give a business valuation of at least $4 to 5 billion if not higher. This would give a conservative valuation of £3.8 billion which would give a share price of £3.43. The market however could end up valuing the business lower or potentially much higher depending on market sentiment and the upside potential from this level. Which from here looks very good indeed. The added benefit of such profits is a percentage of these profits will be shared in dividends which the company will define in its dividend policy with this years 2018 financial results. In 5 years’ time the annual dividend could well be the region of today's share price!

Part 2 of 3

Bushveld Vanadium

This includes now the established Vametco plant with the Vametco mine and the Brits mine awaiting opening as required once the operating licence is granted. The purchase of Vanchem is underway which is a key purchase to help the processing of additional ore from either Vametco, the forth coming Mokopane mine and other existing ore suppliers. The total reserves of 440 million tonnes which leads to a figure of over 7 million tonnes of vanadium at hand. That is a massive resource and even at 25,000 mtV per year output it would last for 281 years. However, currently the company is only targeting 10,000 mtV per year. This is a large percentage 10% of the world consumption. But, it is clear that in 5 years time the opportunity to grow this considerably depending on the market requirements is clear.

http://www.bushveldminerals.com/about-vanadium/

Bushveld Energy

Bushveld Energy – The opening business due next year for completion is the Vanadium Electrolyte plant which is due for operation end of Q1 2020. They are also likely to start producing small batches of trial electrolytes (originally planed at Vametco, but this could be possible at Vanchem with the chemicals expertise there). Bushveld Energy have already sourced a quantity of vanadium to produce electrolyte and they can still use a known supplier to make it in the short term under contract. They are committed to building the first supplied 1MW VRFB which will be installed with a solar installation at Vametco as a model for businesses to see. However, the potential is made up of potential contracts with South Africa’s Energy Supplier Eskom who are committed to 1440 MW of energy storage projects, which are likely to be primarily from VRFB technology with some Lithium Ion. These projects would be ideal for Bushveld Energy to supply into and the first phase of the Electrolyte plant is designed to meet these needs. In conjunction, Bushveld Energy wants to work in partnership with a VRFB manufacture to assemble VRFB locally to the Electrolyte plant. Details on this are still to be outlined by the company. One aspect in SA is the limit in Independent Power Producers (IPP) away from Eskom, which is restricted. However, it is likely given the state of Eskom that this may be lifted to open up the market. This will play into Bushveld Energies hand. Many large businesses, mines, and industrial areas, as well as small towns, could run on a large percentage of renewables and reduce their energy costs with funding and grants given by the world bank. Bushveld Energy could become a large player in this market with the VRFB with partnership opportunities with solar and wind. Bushveld already have key people in their team with project management expertise in this area.

Part 1 of 3
I often get asked where I think Bushveld Minerals might be in 5 years’ time?

The question really brings two thoughts:

1. – What will the company be doing, and will the vanadium market and the battery storage market be as large as we are anticipating?

2. – Where do we see the stock price appreciating too?

1. – What will the company be doing, and will the vanadium market and the battery storage market be as large as we are anticipating?

This first question is one which has been fully covered in the two presentations based on detailed research by the company:

Vanadium - http://www.bushveldminerals.com/wp-content/uploads/2018/05/Bushveld-Minerals_-Vanadium-101-final...pdf

Energy Storage - http://www.bushveldminerals.com/wp-content/uploads/2018/11/Energy-storage-101..pdf

The market potential for both these markets is growing day by day and Bushveld Minerals portfolio and diversity is expanding and looking more exciting.

Amxdd, the only advice we can give you is chose companies that have fantastic fundamentals, ideally no or little debt and are working at building a business in a market or markets with huge potential that you have an interest in and are prepared to fully research.

Bushveld Minerals fulfils all these points apart from the last two, as I cannot judge your knowledge or your interests. But you can be sure the majority of long term holders here have researched this company as much as possible. The company is possibly the most researched company in terms of non professional investors on the London Stock Market. It certainly has massive potential upside. I think you know the best places to research.
The Bushveld Minerals website
The Bushveld Perspective website
YouTube - Fortune Mojapelo
Reading many of the experienced long term investors on here.
Don’t be put of by direct comments, but take them onboard and think your strategy through and build up confidence.

Cheers RK

For new comers!

If you want to review the progress of 2018 you might want to read my article from Christmas:

https://www.thebushveldperspective.com/blog/public-articles-1/post/mandela-to-mojapelo-a-vision-to-change-africa-for-good-384

It gives every step of the progress last year.

Quarter Updates & News29 Apr 2019 14:49
Just a summary to see the picture.

Q4 - 2017 - All together 22nd January - Vametco - 631 mtV

2018

Q1 - Lemur Holdings - 5th April
Q1 - Bushveld Energy - 11th April
Q1 - Bushveld Vametco - 27th April - 731 mtV

Q2 - Lemur Holdings - 4th July
Q2 - Bushveld Energy - 11th July
Q2 - Bushveld Vametco - 22nd August - 629 mtV

Q3 - Lemur Holdings - 17th October
Q3 - Bushveld Energy - 29th November
Q3 - Bushveld Vametco - 9th November - 537 mtV

Q4 - Bushveld Vametco - 30th January 2019 - 657 mtV
Q4 - Lemur - 13th February 2019
Q4 - Bushveld Energy – 27th March 2019

Total production for 2018 - 2554 mtV

Strong EBITA up 349% year on year to $107.5 million.

2019

Q1 – Lemur - 10th April 2019 - Project on target and signed PPF $1m funding from DBSA. BFS is completed by Sinohydro. EPC contract negotiations underway. SEIA due in Q2. Very positive update! BMN is delivering a huge project!

1st May 2019 - Suprise RNS - Bushveld Purchase Vanchem to increase output to 4200 mtV over 5 years ready to receive ore from Bushveld Mokopane which has its mining licenses. Bushveld Vanchem will produce initially 960mtV per annum and will become one of the most profitable aspects of the Bushveld Minerals Group.

Q1 – Bushveld Vametco – Including latest production update and resource info - on the grapevine from the shipping data to the US this looks very promising! Could this come this next week?

Q1 – Bushveld Energy

Other news due soon:

- 2018 Full Accounts
- Bushveld Minerals Dividend Policy and possibly a token dividend in 2019
- News on Vametco upgrade and full 2019 production targets
- Brits Mine plans for the future
- JSE Listing end of Q2 or the beginning of Q3
- Mokopane Mining License to supply Bushveld Vanchem, Ore Directly to China and eventually a greenfield processing plant. Mokopane has the ability to provide ore for up to 25000 mtV per annum if required.
- News on Bushveld Energy commencing the electrolyte and VRFB assembly plant

Bushveld is committed to increasing the vanadium mining output to 10,000 mtV in the medium term 3 to 5 years
Bushveld is building the Electrolyte plant to produce an initial output of 200 MWh of electrolyte and expandable to 1000 MWh
Lemur is on track to deliver a mine and power project in Madagascar and create over 1000 jobs benefiting the economy in a major way.

Pressure has returned on global vanadium demand and prices are starting to rise again which means our profits are going to be increasing again too in Q2.

So you can see clearly there is much to raise interest and all the substance needed going forward to raise our stock price considerably towards our broker targets and way beyond!

Don't forget on Tuesday 7th at 13:30 Uk Time:

https://www.miningreview.com/energy/battery-storage-africas-energy-metals-market-and-supply-chain/

Presenting:- Mikhail Nikomarov, CEO of Bushveld Energy

Mikhail is an entrepreneur and African energy leader committed to resolving the continent’s electricity shortage. He co-founded Bushveld Energy to provide large-scale energy storage solutions across the African continent.

Working with numerous partners, the company is also localising the manufacturing of VRFBs in South Africa. Previously, Mikhail spent 6.5 years with McKinsey & Company in Moscow and Johannesburg, advising national governments, utilities and manufacturers on growth strategy and policy and leading operational turnarounds in the energy sector.

Mikhail also serves as the chairman of the SAESA and currently chairs the Energy Storage Committee for Vanitec, the global organisation of vanadium producers. He holds an MBA from INSEAD, a diploma from the London School of Economics and two undergraduate degrees in History and Economics from the University of Massachusetts.

I am amazed after the last few days that you come on here starting a thread which is actively negative.

We have been due this amazing news on a new Brownfield for a long time and it is absolutely stonking. If you have nothing good to say about it or you have personal issues please seek help. Now is not the time to discuss anything apart from the where we are heading. If you came on here expecting a load of love clearly after starting such a ridiculous thread you are mistaken.

The company has set its self up to ensure it can grow very quickly and be ready for the vanadium market to expand and full the needs of the steel industry and the VRFB market which is set to be a $50 Billion global market over the next 10 years. Bushveld Minerals are in the best sharp possible and are building the worlds largest Electrolyte plant in readiness and now they have the basis of capacity to supply vanadium to this plant.

Fortune told John Meyer yesterday in response to a question that the first phase of 200MWh will use 1100 mtV for 2020's VRFB electrolyte with upside capacity ready for future needs as the market opens up.

So the subject is:- Who else is buying in. Because BMN we are ready to take investors to the next level.

Fortune said "we are committed to delivering attractive returns to shareholders"

That is enough!

Hello Amxdd, Welcome to Bushveld Minerals.

As it is hot of the press, as a new investor here, have you watched yesterdays presentation? There is a lot in this which you should take in.

https://webcasting.brrmedia.co.uk/broadcast/5cc315de3c8e41495e2420cb

I would recommend you also spend some time not only looking at the Bushveld Perspective as recommended by Roscon (which I wholly endorse), but also on the Bushveld Minerals Website where there is a host of presentations, videos, and interesting information.

The upside potential here is huge and unlike SXX our current debt position is zero and we are making a huge profit. (No doubt one-day SXX will be there but not as quickly as BMN). The 2018 accounts are due within the next 9 weeks which will show this - expect in excess of £40 million profit.

You will find some very high-quality posts on this board and we all endorse the points made from BigByteNow. Some even thought he was Fortune our CEO. But we know even Fortune wonders if BBN has a microphone in his office as he is so on point!

So enjoy your research and look for a reward over 3 to 5 years and you are very likely to be delighted!

Cheers, RK

It certainly looks big in the ariel view of the plant. But so does the one at Vametco. If the one at Vametco has a throughput capacity of 3750. It may be even the same size.

Thanks BBN.

I was also thinking that they would look for a location for an IPP project at Vanchem. Ths plant with all its plant would have a substantial energy consumption so the requirement for the IPP regulation to be lifted would be very inportantant. It makes you wonder if part of the $45 million investment at Vanchem includes the within its capitalised projects for a large solar / wind install and a VRFB. If space is limited wind power could be a good solution as the land area is much reduced. The is a lot of industrial buildings at Vanchem. The wind / solar roof / VRFB combination would be another example to show clients what BE can achieve.

This story and business development are so exciting for all investors and the employees must be very encouraged to be part of this company as it grows into a gem of a SA company.

As you say it is part of "the stairway to vanadium heaven!"

BBN - So very interesting snippets as always.

It was interesting after the presentation in the questions asked about the rotary kilns being different sizes. It will be interesting to find out which ones are able to operate. One looks considerably larger than the other two. I woild assume they have different throughput capacities.
Fortune mentioned that ore could be transported from Vametco / Brits to Vanchem for processing. As this is explored further it may give a upside potential at Vanchem in a shorter time scale.
Fortune also said that ramp up and throughput could be adjusted depending on demand and they would not spend more than required at any time unless demand requires it. So it sounds to me like they can play tunes with investment depending on the market requirements.
This plays out well to adjust according to licenses being granted and the uptake demand from the electrolyte plant. It will be critical not do more than they can sell, especially as too much production will destress the vanadium price.
Just musings...
Cheers, RK