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I believe the 5 parties to the letter of intent for the port project are:
Zanaga Iron Ore
Sapro Iron Ore
Cominco Phosphate
Kore Potash
and Evergreen Potash
These are the main and most feasible mining operations in the area.
So we've got an asset worth an estimated £3 per share for an all cash offer at this stage in development i.e. before port announcement.
Once port finalised and export route agreed, we are looking at £7 - £9 per share.
Cold palletisation success and this jumps to £12 per share.
Evergreen (potash)
Remember that there is a certain Chinese mining company already clearing the way for their land at the new port site.
Don't forget to scale the project over the full iron deposit.
(Figures below exclude capex)
770 MT proven = $62.37 billion
2.1 BT probable = $170.1 billion
6.9 BT resource = $558.9 billion
$22.65 premium for 3% higher grade = $7.55 per %
66.6% FE = 4.6% above 62% benchmark = $34.73 + $67.44 = $102.17/ton
Revised $103.14
Stage 1 Opex costs reduced to $24/ton (top end estimate)
= $79.17/ton profit potential
12Mtpa = $938,040,000
9 years = $8,442,360,000
Stage 2 Opex costs reduced to $22/ton (my estimate)
= $80.17/ton profit potential
30Mtpa = $2,405,100,000
21 years = $50,507,100,000
Total profit over 30 year life = $58,949,460,000 ($59 billion)
Less $4.4billion capex
= $54,549,460,000
ZIOC share = $27,274,730,000 (£20.5 billion)
283,201,033 shares = £72.23 per share
And remember this is only the 770 MT proven so far, we have further 2.1 BT probable and 6.9 BT resource.
Hold onto your knickers everyone.
I'd suggest Keith Everitt has always been a holder here, and was likely one of the original holders under Garbet which was distributed to individuals (majority being under the 3% threshold).
Seems he's been buying recently on the ridiculous fall below 10p
Whats not to like though...
$60 billion proven resource
$170 billion probable
$550 billion total resource
independently proven 67.4% iron ore fine.
pellets actually produced and being tested as we speak that could blow the above profit figures even higher!
Sorry but don't think that answered my question. I'm not currently invested but have been watching a while.
It's a good story but I don't understand what process they have to go through to apply and be granted a full production licence on individual structures or how long that application process takes etc.
Indeed, all progressing as planned with no obvious objections to the transfer. Once complete workaround to sanctions should be finalised.
Looking to then use profits and current cash balances to buy more assets.
The question is, how long does the application process take to move to a full production licence and what potential barriers are in the way of it being approved. i.e. can it be refused and on what grounds?
Two main iron ore producers likely to use new Port are Zanaga and Sapro
The three main potash producers are likely to be Cominco, Kore and Evergreen
But remember that ZIOC is the biggest iron ore producer here and should take priority with any discussions with CRBC
So if we can achieve $103/ton for our high grade fines and EPP is the low opex option. Stage 1 costs are $24/ton so presume we can EPP for $20/ton that gives $83/ton profit.
x 1mtpa = $83m
ZIOC 50% = $41.5m
= £31.125m
/ 283,201,033 shares = £0.1099
x 10 P/E = £1.10
plus your 67p below gives £1.77 just from EPP
Total profit potential here is massive and remember that the resource extends deeper than they drilled, so could be even larger than currently stated.
Proven 770 MT x $80/ton = $61.6 Billion
Probable 2.1 BT x $72/ton = $168 Billion
Resource 6.9 BT x $72/ton = $552 Billion
Buy and hold.
So we had the rumours from inside the Congo that Rio might be buying their 10% share to help restructure their debt. Today we have notice that Rio are in the process of selling another asset for a mere $3.5bn with their CEO stating their focus will be on a few key high quality assets. They have already earmarked $3bn for iron ore and now this... Taking them to $6.5bn The question is, will they take a slice of ZIOC and are discussions already underway?
Paul Obambi is Congo-Brazzaville's leading private sector entrepreneur. His Sapro group, with its 14 subsidiaries, covers most of the country's key business sectors, so he has his fingers in a lot of pies. They own an iron ore mine that is being developed albeit much smaller than Zanaga's offering so could be an early indication of final sign-off for the new port.
Piet Viljoen Mine Manager SAPRO GROUP Oct 2017 � Present (8 mos) Mayoko, Brazaville, Congo open, operate Mayoko Iron ore, 3mtpa mine ---- Looks like its only recently opened and begun operations?
Where are people getting the Sapro SA information from please? The last info I had, recorded Mayoko with 182MT of ore (which wasnt JORC) and that they were still waiting to conduct PFS subject to arranging appropriate infrastructure. So looks like they plan to produce 150 MT over the life of the mine, which is still considerably less than Zanaga. They could actually share some of the pipeline costs with us (not being too far away) as an option which could add an interesting dynamic here.
gta5 mentioned wanting shovels in the ground at Pointe Indienne... well a large part of the new port area has been cleared which can be verified using google maps. Cominco Resources have some close up aerial shots of this as they are their allocated neighbour. The area that has been cleared is allocated to Chinese firm Evergreen who are developing the MPC potash project, so I'm guessing they have some close connections with the other Chinese entities CRBC, EXIM etc and are happy to have started work on their facilities without any "formal" signoff on the port.
Indeed, Trump wants something so pulls out of the deal to get it. Seems to be working for him in other areas to be fair. A workaround was put in place last time while they were under sanctions, so shouldnt be any different this time.