Hi BNC and Novice. Aye, I think we are firmly in the “hold on for the ride” phase now. Inviting JVs of necessity involves sharing what we know about the better prospects in the pipeline. Either the SP goes up from the response to that, or from those interested parties also wanting to stop BHP and Newcrest running off with the whole sweet shop for a song. Turbulence ahead, fasten seat belts, but on no account try and exit the plane !!!
Brilliant presentation and performance. Now Solg, get that blooming pipeline valued up ASAP and JV some other majors into the subsidiary prospects a) to fund it and b) so there would be a proper fight in a t/o scenario. And while we are at it get the improved development narrative for Alpala out too. The board needs a legit basis for rebuffing any lowball offer and we need those stories turning into valuations. Sitting ducks at the moment. Gnash gnash.
For me, this was the best bit of the RBs: In early March, SolGold commenced a process to identify potential JV/earn-in partners over 10 of its 100%-owned early-stage exploration projects containing 20 prospective concessions covering 86,000 hectares across Ecuador. These concessions were highly sought after during the original bidding process. That’s a handy insight into where we are heading if ever there was one.
Lunch money, I’m used to projects taking 2-3 years to build and commission so the cash flow is all outwards during construction. Then there is the commissioning phase, then some steady state, then shutdowns for minor and major outages and targeted debottlenecking. You use BPV and IRR techniques to rationalise cash Flo over the life of the investment, starting from when the first sod is turned, in year 0
Ideally, non-execs taken together bring independent experience spanning all dimensions of a business. Sometimes they individually and explicitly buddy an exec directors own portfolio. I don’t think anyone would baulk at NM being the non-exec leading on exploration.
Tend to agree. There was a switch by certain characters to cornerstone, and their Solg holding was bought by BHP before NM could say ‘dingo’. That looked like an axis of evil in action with an eye to gaining control. And then discovering the bootstrap plan involved some of Cornerstones own tenement. Those two together are probably whats steered this move to self financing and independent operation, and along the way attempting to squeeze cornerstone on their Alpala funding obligations. So, back to a sensible geological / commercial plan perhaps, but with a politically weakened hand to play with when it comes to ownership longer term. Plenty of upside but perhaps not dizzy I fly high, or for that matter, quite so far off. IMHO
Aye ToS. The Chinese might pick a few up. Time is on the buyers side. Solg will burn through their reserves and if they’ve nothing to sell, the so will reflect that. Cue another big dilution with the majors cast as genial benefactors, .. at the right price. We need more benefactors, ideally ones who don’t meet up for a pint after work to talk about how to play us next!
I think the PI trading even on a busy day is a teeny fraction of the share book. If BHP started hoovering up, it wouldn’t materially increase their grip but the supply would tighten up in no time and the price head north which is the last thing they want. It’s as likely the big players would actually trickle a few into the market to keep us (and the sp) all a bit depressed. The price volatility is a reflection of the PI mood, the big holders are just sat holding their cards close to their chest, watching, waiting.
My thoughts exactly FTJNY. Rather than openly collaborate over that option, with hindsight, Mather appears to have shut it down and instead tried to turn Alpala into an un-meetable obligation for CGB, presumably to squeeze them into accepting a takeover. Good plan, .. had it worked.
Well I think we are owed a presentation and a proper strategy reset. Certainly looks like the CEO-elect is clearing the decks so it’s all attributable to the last watch. A paucity of news, a risky strategy, under delivery and U turns. Not writing this off but increasingly comfortable with the baton change. This was all a bit too cozy with hindsight.
I doubt we could ever have built Alpala even if we found lenders, streamers and turnkey project deliverers. It’s a colossal jigsaw to assemble. The main reason against taking it on is that if anything didn’t go to plan, we would be soooooo vulnerable to predators. Borrowed, mortgaged, no income stream and with no wriggle room. And frankly, nothing goes exactly to plan in this game.
Developing Alpala as a largely (but not completely) derisked entity suitable for majors to bid on is completely rational. The sale price will reflect the residual risk as well as the resource. Success for me is selling Alpala whilst retaining the Solg pipeline and enough liquidity to prove up some more. I’m hoping the board agrees. If we try to be too greedy over Alpala, I suspect we will lose the lot.
If we sold most of ENSA but retained some, we might get an income stream from Alpala eventually but I’m sceptical unless our contribution to the mine development cost is most of the resource as contribution in kind. So, let’s await a strategy refresh and see if the new CEO has ambitions to be more than just a caretaker.
Well it’s an I’ll wind and all that. I’ve rebuilt my modest reserves again and so will be topping up if it drops much further. Can’t promise to turn it around lol, but it feels like something fairly seismic is going to happen by the summer. Based on a hunch, some tea leaves, a groundhog and a fir cone.