Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
Thought I would buy another 60,000 shares today to nearly double my holding.
Economics look terrific and currently valued significantly below 5% of NPV using current spot prices of MOP.
Low Capex project when compared to others of similar scale (mainly due to decline and no requirement for shaft).
Plenty of upside regarding already long mine life. 30 years+ looks very realistic.
Looking forward to further progress with milestones being reached.
Surely financiers will be falling over themselves to be involved and there should be no problems getting off take partners with plenty of wriggle room regarding pricing.
Not to forget how well we are positioned strategically which is a great advantage to counter rising energy costs.
I'm sure we have more than enough Sunshine in Morocco to take advantage of the growing green power solutions. This will help keep our costs down.
GLA Sharegar.
Good observation from GingerHippo on twitter today.
“our structuring is approaching completion, as we work hard with DLA Piper and our other legal advisers.” no mention of UBS. Presumably their part has already been completed. Just the legal bits left before our #SignificantDividend
Today’s RNS indicates our portion of EBITDA will be 252 ZAR for capex outlay of 180 ZAR. This is for only 2.7MW portion of the first project, which can be scaled quickly to 8MW.
The RNS for 24 SEP 2022 Half year report outlined the plans for another 6 similar projects. This means we should expect a total of 50 MW and therefore more profits to come.
Therefore, if you do a very crude calculation (assuming capex is constant per MW addition) that would mean we multiply EBITDA margin by 18.5.
I make that EBITDA of 1332 ZAR or £66.6m for KIBO’s portion.
Superb numbers for a company currently valued at less than £6m and remember we own 55% of Mast Energy (A £10.5m company!).
However, I am slightly confused about our coal assets in terms of value.
Included in the message today was:
Louis Coetzee, Chief Executive Officer of Kibo, commented: "Following the Company's disinvestment from coal.”
As far as I am aware, there has not yet been an announcement about how much Kibo will receive for these assets.
The half year report was very bullish about our prospects going forward with regards to the coal assets.
It stated we would retain upside value after disposal. Cash plus Royalties? Another Spin out company?
So, I conclude that today was an excellent step forward for KIBO and that is why the market liked it.
Energy prices on the up and coal prices much higher than months ago.
More to come IMO.
GLA Sharegar.
Krayl49
I do not think that scenario would happen.
I'm pretty sure that the Tax people take note of these big events and the 30 day B+B rule does not make any difference.
Ex Div, After consolidation etc.
I have noticed being attached to descriptions of relevant shares in my account.
So, I do not think that is a way to avoid tax on profits.
If they are not protected in an ISA it mainly comes down to the choice of accepting the dividend and potentially paying more tax, or selling for a lower CGT (depends on individual circumstances) and taking a risk in having to buy back into EUA2.
It would be good if we were given a Spin out of EUA2 before it goes ex-Massive Dividend.
That way you could sell without the worry of not getting in again for the next exciting EUA Rum drinking adventure.
GLA Sharegar.
I Knew it all along.
Tillywiz is actually Christian Schaffalitzky.
Quote: "focused on the liquidity event along with all shareholders".
The Wiz of PGM Oz has to be talking about Rum and its sure to be flowing very soon.
It's official there is going to be a "Kraken" deal.
Some loyal sailors may not drink their Rum straight. I will not Judge!
So, Mac will kindly be providing a steady supply of Kola.
LIQUIDITY ALERT.
Rums all round. Sharegar. (No GLA required). Rums all Round.
Brisk,
To hopefully answer your questions.
I do not think the NKT open Pit plus the high grade veins they mentioned in the previous RNS were included in yesterdays resource update and I believe this because they have not communicated to shareholders about the JORC for those items that they had mentioned before.
Also, worth remembering is the fact that the JORC resources for NKT turned out to be significantly higher than the Russian classified resources.
It seems to me that it is very likely that all the other JORC resources that are currently being assessed in draft form will pleasantly surprise us all again and trump the Russian classified amounts.
I think we could be talking about resources significantly above 200 Million Oz Platinum equivalents.
Also factor in what new licences that they have alluded to will bring to the party.
An update on the potential sale will be provided. We eagerly await that one!
Trace the RNS's relating to this announcement (first 28th Oct 2021 and then 12 May 2021). I come to the conclusion that the "credible buyer" who have successfully completed due diligence are still in the race but there are other runners breathing heavily on their back.
BIDDING WAR.
"Advancing several transactions"
GLA IMO Sharegar.
One or two things to note regarding our Resources.
When the NKT resource was updated to JORC in a recent RNS we found out the new resource amount was much more than the previously conservative Russian classification (Which do not include P3 categories).
Note: NKT was still to be further upsized.
Eurasia are now in receipt of the draft JORC which is IMO going to give us an increase again when compared to the Russian classification.
I do not think EUA would have published this resource update if they thought it would be revised down once they have checked the draft JORC that has been handed to them for review.
Add in more licences (RNS)) and we IMO will be on our way to significantly north of 200 Million Ounces of Pt equivalent.
That is why they use terms like Tier 0ne/World Class and compare our resources to the Bushveld region.
The sale reference traces back to the "buyer" who successfully completed their due diligence and we knew that there was added competition from the RNS on 28 Oct 2021.
EUA also motioned the imminent sale update in their tweet yesterday.
Looks good to me.
GLA DYOR Sharegar.
GLA Sharegar.
Not sure if I should be repeating (NDA and all that) but I overheard two Japanese Business men in deep conversation when I was having lunch at my favourite Sushi bar in the city.
One of them was deadly serious that Billy Connolly, yes Billy Connolly was part of a consortium weighing up an offer.
The Business man claimed he had proof, claiming "Big Yen" was involved and it would be announced on a night at the Palladium.
GLA Sharegar.
Excellent post as usual Sp28,
Another positive for our economics is the potential addition of Platinum and Palladium to our flow sheet.
After all, there is approx 0.2g/ton for each of these PGM's.
If we were to make a crude assumption that similar percentages of PGM could be recovered then that would increase the cash flow significantly.
Maybe increasing revenues over the lifetime of the project by 20-35% depending on metal prices.
Not forgetting, the 2018 NPV@10% of $614.5m does not count UG/known mineralised targets/confirmed and significant Increases in all of K-M's basket of metal prices/PGM's and Cobalt/improvements in the flow sheet.
As an investor of EUA as well I wonder if there is potential for more licences surrounding our project.
The rules regarding such rights, favour the company that have the discovery and is how the rules are applied in Russia as I have understood from the evolution of the EUA assets.
Could any of the longer term posters shed any light on this possibility?
We are in the exciting early days of a potential sale but there could be many value adding additions just waiting to be revealed at the right time.
GLA Sharegar.
RY has alluded to the addition of cash flow from these metals and work has been going on in the background.
Many might not think it, but I would say we have made much progress in recent months. Just step back one month.
Jan 6th 2022 RNS: Clarity regarding the Massive dividend.
"The purpose of the Policy is to provide a high degree of transparency to Eurasia shareholders and other interested parties as regards the calculation of the dividend amount and to explain the principles applied by the Board for the preparation of the recommendation to the Company general meeting on the dividend amount."
In other words the >80% dividend will be a reality. They have made it clear there are "preparations" specifically regarding this.
Jan 14th 2022 RNS:
"The Board members are looking forward to finalising the consolidation of formerly operating nickel mines on the Kola Peninsula. Splitting our nickel, PGM and hydrogen projects into separate subsidiary companies allows us to execute on our strategy as announced".
It is clear that EUA is being packaged into 2 entities. The RNS was all about consolidating the predominantly Nickel assets so that they can in IMO announce the sale which ties in with the dividend announcement. The statement made it clear that separating certain assets not only made logistical sense but was necessary for the sale.
Remember, they have previously informed us that they are progressing "several transactions" and are being advised by UBS/DLA Piper.
I think the biggest issue PI's would like more information on is the progress of the licences and their imminent transfer to the subsidiaries that have been set up specifically for these. Once the licences are issued the sale is much more likely to be announced
Maybe the Authorities are waiting on EUA giving the nod that they have finally completed all the JORC reports as promised.
There is absolutely no reason to doubt the JORC reports are not forthcoming and that is because of the calibre of firms that are undertaking these tasks.
Remember, these world class independent entities that EUA are dealing with are all well known to the Tier-one mining. community.
You don't want to hear those ominous words made famous from the show Bullseye.
"Here is what you could have won."
Another one for the impatient. "Rome was not built in a day."
GLA Sharegar.
Eurasia tweeted on the 27th Jan 2022.
"Happy Chinese NY of the Tiger! 2 big CATs arriving to WK. 2 much bigger e-draglines to follow with electricity connected. EUA is focused on ESG and executing our strategy for benefit of all shareholders as previously announced."
Another cryptic message?
My feeling is that we should expect another flurry of RNS's and going by this tweet I think today being the first of the Chinese New year is an excellent time for a comprehensive update.
"executing our strategy for benefit of all shareholders as previously announced." Is the part we really want to know the glorious details.
EUA have been consistent in their claims that they are "executing" and "shareholders will benefit."
Investors have been very patient and now is the time to reveal much more and at the same time silence those annoying derampers.
We know there is an NDA and the BOD respect the rules.
EUA have got the very best advisors and a great BOD but please, never tire of giving us clues so that we can at least read between the lines!
GLA Sharegar.
Page 13 of Amur presentation states NPV (10%) Post tax = $614.5m.Using Ni price of $8/Lb.
However Ni has increased to $10.5/Lb.
Bearing in mind break even was stated as Ni @ $6/Lb. So assuming costs have risen a little with inflation it could be argued that the profit margin has doubled for the project.
New post tax NPV (10%) should easily be over $1 Billion.
Generally speaking the basket of metals have all increased significantly. Also, note that the original PFS only counted Ni and Cu. So if you add Pd/Pt and Co this could add another significant value to an updated NPV.
Remember these metals took the NI equivalent up to 1% from 0.75% using 2019 data.
Furthermore, the NPV only included the Open pits. and does not include the 2020 Resource upgrade that took our resources up another >12% with 25% more in Measured and indicated.
Mineralisation is Known to be present downdip and there are other targets that remain untested.
I've not done the calculation exactly but we already have >1.7MT Ni equivalent which is approx $40B in-ground before taking into account losses in metallurgical extraction.
We are talking NI (Sulphide) which means our main product is sought after for the EV revolution and Power grid storage.
I have the feeling that the leak of a £100m potential offer is just Amur at the starting blocks for a bidding war.
The starting price is known. Which would be about 7p SP.
How high will the needle go?
I do not think >£300m (>21p) is out of the question when the dust settles.
GLA Sharegar (DYOR).
Evan3020 asks,
"Anyone know what the smallest deals they have done?"
I know that two DLA Piper executives once bought a McDonalds meal deal whilst out for lunch.
Hope that answers your question.
I think the EUA deal will be bigger though.
GLA Sharegar.
chique,
You ask me:
can I ask how you are arriving at your profit figure?
The answer was already included in the post you are referring to. So have another read.
I also include a caveat to put the figures the company provide into context.
Sales guidance from RNS 10 Jan 2022:
"2022 Sales guidance established at 150,000 tonnes, or 76% increase from 2021
Substantial sales orders for 2022 started to be placed towards the end of 2021."
My calculation if this rate of growth continues:
150Ktpa x 76% increase = 264Ktpa for end of 2023 figures.
264Ktpa x 76% increase = 465Ktpa for end of 2024.
That would be nice.
GLA Sharegar.
Forgot to add the m. Just to be clear I am not ramping and suggesting a b
The company has the following ambition (see website Homepage: Why Harvest Minerals?).
At 450Ktpa expect EBITDA of US$21.45m.
Sector average P/E is 26.75
Equals a valuation of US$360m.
Worth remembering.
Interesting snippet from RNS: 18 July 2018
"Covering 14,946 hectares and located in the heart of the Brazilian agriculture belt in Minas Gerais, Arapua is a shallow, low cost mine with an indicated and inferred resource of 13.07Mt at 3.1% K2O and 2.49% P2O5. This is based on drilling just 6.7% of the known mineralisation, leaving significant upside potential. This resource is equivalent over 29 years' production and the known mineralisation expected to support 100+ years' production at 450,000 tonnes per annum."
The company has the following ambition (see website Homepage: Why Harvest Minerals?).
At 450Ktpa expect EBITDA of US$21.45.
Sector average P/E is 26.75
Equals a valuation of US$360.
The figures given will need an update for accuracy at todays margins. However, this gives an indication of what is possible.
We are all experiencing higher prices these days but history tells us that this is normally to the enormous benefit of commodity companies.
If our sales continue at the current protectory we could actually be talking about 450Ktpa by year end 2024/25.
The talk about Directors remunerations will be of little significance.
This does not take into account the plans for the recent additions of the Lime and Phosphate projects in 2021.
GLA Sharegar.