Member Info for ShipwreckSheep

SP might be marked down, SETSqx is a pleasure as always, but should it be marked down when it was a high volume day and VWAP (volume-weighted average price) today was 5.19p of all the reported trades?

Yeah, it's a great interview, I'm also happy that he compares it to Kalkaroo (Havilah/Sandfire) during it, given that's what I had used as comparable when I was writing about Blue Rose's potential earlier this year. Nice to see it validated by him.

And also good to hear towards the end of the interview that rare earths infill drilling should start "as soon as next week".

When the market opens, retail investors will just look at the "1.02% Cu" headline and cheer. But institutional analysts at the major mining funds will run this exact CuEq math. They will see a project yielding 74m of 1.35% CuEq alongside massive molybdenum kicker grades (like the 3,800 ppm hit in hole 0003), and they will instantly recognize this as a tier-one discovery...

I see what you did there, but given the infill/growth drilling starts within the next 2 weeks (mentioned in the video that was released alongside the RNS), pretty sure the Q2 2026 date for MRE will be delivered.

So long story short, obviously there's de-risking to do especially on ISR field test front...the permeability and pump tests showed great results but were so far only on a small area, so that needs more testing (which is also in the work plan from today's RNS' bottom section).

But...metallurgy is pretty much fully de-risked as also shines through in the RNS today, there's upside left to value from the lanthanum precipitation work (Apr-Sep), but the metrics as they are now seem pretty much in the bag. And if hydrology works as in the field test results as well as in the ISR lab tests, then yeah, the metrics point to a fully de-risked EV of 500m$ at the absolute most conservative valuation possible and well over 1bn$ when using more optimistic (but not unrealistic) values for the variables. So yeah, Rupert will have a shot at ticking off also the higher targets of his incentive rewards at 30p and 60p if all continues to go well, especially with CAPEX need of only 50-100m$ to get to full-scale production.

It's also pretty insane how many catalysts are close:

Copper assay results (that Tweet of first batch being sent to the lab was 19th Jan, so if they RNS the assays in batches, we might see the first one very soon),

Manna Hill Option Exercise (it's a formality if you ask me, but we go from "Okay, Cobra do some exploration work on an asset they don't own yet" to "Well, that's part of Cobra now")

MREC samples sent to 5-10 potential offtakers (with the quality of that MREC - highest-in-class MREO/TREO, highest-in-class HREO/TREO, low impurities - that will very likely lead to agreement(s))

MRE & Scoping Study back to back (so given Cobra spent the last 2 years on metallurgy optimisation and only now does MRE compared to most companies pushing out an MRE and then get stuck on all the metallurgy work that will be super interesting)

It's all the ingredients over the next 6 months that are needed for government/agency funding of the CAPEX, for offtake agreements to be signed, for institutional investors to commit, I don't really care if today's RNS had a huge price impact, it was a very positive surprise on several fronts (lower than expected impurities, far higher than expected % TREO/MREC) that forms an outstanding basis for these items just mentioned that - by nature - have bigger price impacts.

No Mav, it's not A$, it's USD, check Figure 3 in the RNS, says that the 65$ value / kg TREO is in US$. So $159m = £119m.

So yeah, there is considerable upside, even if you go super conservative (so you say throughput only 3Mt, put a massive discount for recoverability from 70% to 50%, and put in a conservative buffer on AISC to 8$ instead of 4.5$) to shock the valuation, you still get to $50m EBITDA and imo those are the absolute most conservative values that can be put on each variable given the communication on those matters by the company over the past year.

I think you are using too low an EV/EBITDA multiple as well, 4-6x is for a boring metal producer, so new rare earths supply (highly needed) coming online outside of China in a safe jurisdiction, that's 8-10x at least, and with the unicorn HREO fraction of total TREO, that could be closer to 12-15x. Lynas trades at a much higher multiple for what it's worth, but that's because of how strategic they are, for now.

I'm trying to use conservative estimates for most metrics, LC, it's the better thing to do from risk management perspective if you ask me.

But that said, my MREC value / kg is taken straight from today's RNS, 65$/kg TREO, 58.85% of MREC = TREO, so 65$ * 0.5885 = 38.25$ per kg MREC.

Updated profitability guesstimate:

Assumptions:

6 Mt/y throughput (matching Meteoric's throughput)

1,000 ppm TREO (lower than Boland drilling results over the last years, staying on conservative side)

70% recovery (slight upside to the 66% from the column ISR results, as there's flow sheet optimisation room left)

AISC $4.5/kg MREC (latest measure we have on that from Nov webinar)

“MREC value” $38.24/kg with 70% payability (payability likely higher with Ce almost entirely removed from the MREC, but staying conservative again)

Step-by-step

TREO contained (t/y)

6.0 Mt * 0.001 = 6,000 t TREO

TREO recovered (t/y)

6,000 * 0.70 = 4,200 t TREO

MREC produced (t/y and kg/y)

MREC t = 4,200 / 0.5883 = 7,139 t

MREC kg = 7,139,215 kg

Realised price per kg MREC (net)

$38.24/kg (basket) * 0.70 payability = $26.77/kg MREC

Unit margin

$26.77 − $4.5 = $22.27/kg

Annual revenue, cost, margin

Revenue: 7,139,215 * $26.77 = $191.1m/y

AISC: 7,139,215 * $4.5 = $32.1m/y

Operating margin: $159m/y

That's far better than previous guesstimates I made, I expected the TREO per kg MREC % to go lower a lot more from the cerium removal process, it's really (positively) surprising to me to see that optimised it's still 58.83% TREO per kg MREC

Might be overlooked given the fundamental RNS, but nice to see more of the November-maturity warrants have been executed early with 3 million of the 2p ones and bit over 400k of the 2.3p ones

What are you talking about nidgeyr? Don't twist my words, jog on

We're invested in an explorer/developer, and going through MRE, PFS/DFS stage is the common way, usually getting to production takes 10 years, Cobra have found Boland in 2023 only, so if you are only interested to invest in companies that are producers or starting production tomorrow, that's fair enough, but it looks like Cobra can get to production within 5 years from discovery, which is extremely fast. And MREC with highest-in-industry concentration of MREO & HREO (Figure 3) + highest value per kg TREO (Figure 5) is hugely exciting as it goes straight into profitability metrics, especially when paired with previous news that we're at 5$ all-in sustaining costs per kg MREC. So if you think that's all blah blah because "they're not gonna start producing this year" (which nobody ever claimed they would), then that's more of a reflection on you than on anything else

Yeah, offtake samples should be sent after the radionuclide testing that's mentioned at the bottom of the RNS. MRE and scoping study seem roughly on track for Q2/Q3, so think PFS work can start this year and first production during a pilot study in H1 2027. Full production only after PFS/DFS like for any other company, but as Rupert had talked about in the Crux interview (the one before the most recent one), they don't have to build a mine site with ISR but can operate out of mobile shipping containers, so it won't be a long runway from the feasibility studies to actually producing.

Yeah, no worries, I didn't mean to come across like it's a problem or anything, I just usually prefer not to take comparisons between Cobra and another company to a different board, you know how it always ends up on this website, then somebody over there will just think it's cross-ramping, then some of them come over here, etc - it's been a really civilized and informative discussion board on here for Cobra, so I try to preserve that.

You're very welcome to join the COBRHelp group on Telegram if you want, it's easier there to keep the cross-board dynamic mentioned above at bay. Depending on what the copper drill results show, it could get pretty busy here pretty fast, with visible primary copper and/or molybdenum in the majority of the drilled holes - if the assays confirm those grade estimates ofc.

Well Andii, I've given you my opinion of why there are a lot of challenges - SVML have only just found rare earths, and like every company that "just found rare earths", they make it sound easy and they of course highlight the "potential for additional revenue stream". Cobra did exactly that too when they first found rare earths overlaying their gold resource at Wudinna, and people were excited, look back at SP action in early 2022. But the truth is Wudinna rare earths wouldn't have been a massively economic project, even overlaying the gold. Whereas Boland shows extremely competitive profitability metrics, with >30$ value per kg MREC vs cost of 5$ according to the latest presentations and webinars. Without big challenges, as recoverability is extremely high at the lowest acid quantities I've seen from any company so far (helped by the fact that the orebody generates acid itself with the addition of oxidants), and extremely low uranium and thorium values.

I think your next course of action should be to ask SVML management "so how about those uranium and thorium values as they are extremely high!?", or of course you can choose to discard the points in my comments, that is your choice to make, but there is little point in discussing on the basis of "but the company says it's great". Every company says their asset is great, especially if it is an addition to a current project that *could* add value. But in the end this is a Cobra board, so if you would like to chat about Cobra, the upcoming rare earths MRE and scoping study, or the copper/gold/molybdenum drill campaign(s) right now, you're more than welcome to engage, but I hope you will understand that I don't have the time to jump into discussions on other boards for every company that finds rare earths on their tenements, as that's not that rare a thing, it's just usually not as easy as the companies first make it sound. That was absolutely also the case with the rare earths overlaying the gold at Wudinna for Cobra, which is why we are extremely lucky that they managed to zoom in onto Boland and that paleochannel, as it's very prolific on flow sheet front with pretty fantastic results from the in-field ISR tests (which, that is worth repeating, is the mining technique that has gone from 10% to 60% market share in uranium over the course of 2 decades, so that's the potential for ISR rare earths). Needless to say that it's also extremely enriched in the right rare earths elements with NdPr being 32.6% of TREO, DyTb 5.7% of TREO (so MREO close to 40% of TREO), and heavy rare earths 48% of TREO.

Hi Jezzoo, welcome - I second tigger's comment that joining the COBRHelp Telegram group would be worthwhile, there's more discussion going on there than on this board. I'd say you become a Cobra investor at a very interesting time, with copper/gold drill results about to come our way over the next 6 weeks, and rare earths infill & growth drilling for MRE and Scoping Study also kicking off over the next weeks.

For completeness, given that you are new to the share, worth pointing out 2 additional things (as the 2 main projects above are obvious from the website and most discussions):

1) In addition to its own projects, Cobra holds a strategic investment of 6.45 million shares in ASX-listed gold developer Barton Gold (worth between 4-5m£ currently, so give or take 10% of Cobra market cap)

2) The significant shareholders are worth doing a deeper dive in, Bruce Parncutt (holding over 10% of the outstanding shares) is former CEO of Merrill Lynch Australia and former director of the ASX; Craig Ball (also holding over 10% of the outstanding shares) is former Chairman of one of Australia's oldest brokerage firms, and David Clarke (also holding over 10% of the outstanding shares and a director of Cobra) a very successful geologist with over 50 years of experience in South Australia. Then we have Ausum, an Australian institutional investor, holding ~ 6% too, so roughly 40% of the share register in very high-quality sticky hands, with a guesstimate of an additional 30-40% of outstanding shares being in retail LTH hands. So not a whole lot of free float, which can be frustrating if you look to build a larger position quickly, but also works in Cobra's favour a lot when news spark the interest of new investors in the share, which personally I see as likely on the copper/gold drilling results given that up to now for the past 2 years, Cobra was "only" a rare earths developer.

3. The Pricing and Regulatory Illusion (Addressing Point 1)

Poster 1 calculates massive revenue bumps based on a $8,500/t price for monazite concentrate delivered to China.

This math ignores the radioactive penalty. China is the primary global buyer of rare earth concentrates, and their customs authorities have strict import thresholds for radioactivity. If a concentrate exceeds these limits, it is heavily penalized in price, requires special import licenses, or is rejected entirely. The $8,500/t price tag is typically reserved for clean, heavily processed MREC or low-thorium concentrates (like bastnaesite). If SVML tries to sell raw, radioactive monazite concentrate, buyers will demand a massive discount to cover the exorbitant costs of handling and disposing of the radioactive waste on their end.

4. The Value of Uniformity (Addressing Point 2)

Poster 1 points out that the drill core results are uniform across the ore body. This is a genuine positive. Geological consistency makes mine planning and processing much easier and cheaper because the plant doesn't have to constantly adjust to fluctuating feed grades. However, while uniformity is great, it is completely neutralized if you haven't solved the U/Th metallurgical processing hurdle first.

The Verdict

Poster 1 is looking purely at the "in-situ" value of the metals without accounting for the intense chemical, regulatory, and financial realities of extracting them. Poster 2 is right to bring up Cobra Resources as a comparison: a company with 2+ years of proven metallurgical flow sheet optimization is vastly further along the development curve than a company that has just realized its tailings contain radioactive rare earths.

SVML has a great rutile project, but monetizing the monazite byproduct will require significant time, capital, and complex chemistry.

For the rest I'll refer you to Gemini Pro after feeding it out 2 posts and analyzing, it's actually covering it quite well:

Poster 1 is falling into a classic trap in junior mining investment—confusing an "in-tailings" mineral occurrence with a commercially viable, ready-to-sell product.

Here is a straightforward breakdown of why Poster 1's assumptions about Sovereign Metals' (SVML) Heavy Rare Earth Elements (HREE) discovery are vastly oversimplified, and why Poster 2's concerns about Uranium (U) and Thorium (Th) are the actual bottleneck.

1. The Radioactive Reality of Monazite

The core of the issue lies in the mineral itself. The rare earths at SVML's Kasiya project are hosted in monazite. While monazite is incredibly rich in valuable rare earths (like NdPr, Dy, Tb, and Yttrium), it is universally notorious for one major flaw: it acts as a sponge for radioactive elements. Monazite typically contains between 5% to 15% Thorium (ThO2) and notable amounts of Uranium.

Poster 1 brushes this off, but Poster 2 is right to flag it. You cannot simply scoop up highly radioactive monazite sand and ship it globally. It falls under strict Class 7 radioactive materials transport regulations.

2. The Myth of "Zero Opex" and "No Met Work" (Addressing Points 3 & 4)

Poster 1 claims that because the material is already mined as a rutile byproduct, there is "almost zero Opex" and no advanced metallurgical processing needed—just "assay the results. Job done."

This is fundamentally incorrect.

Physical Separation: Even if the material is in the tailings, isolating the monazite from the rest of the waste requires its own dedicated physical separation circuits (spirals, magnetic, and electrostatic separators). This adds immediate Capex and Opex.

Chemical Cracking: Because of the Uranium and Thorium, buyers will not just take raw radioactive dirt. SVML would almost certainly need to build a hydrometallurgical processing facility to "crack" the monazite. This typically involves an acid bake (using concentrated sulfuric acid at high temperatures) or caustic cracking (using sodium hydroxide) to strip away the radioactive elements and produce a safe, transportable Mixed Rare Earth Carbonate (MREC).

Designing, permitting, and proving this flowsheet takes years of pilot testing. You cannot skip the met work.

Well, I'm not gonna turn this into a SVML chat, but I'll say that you seem to vastly oversimplify the process just because it's tailings they have. Look at the ppm of uranium and of thorium at the bottom of that SVML RNS you linked and you are faced with a considerable metallurgical problem already, is it possible to overcome it? Maybe. Is it a simple "they have tailings, they can just sell it on as byproduct without a met flow sheet needed? No.

"One can only say the big,big consistent seller is obviously singing from a completely different hymn sheet to the converted, another circa half a million unloaded and £24K to boot today, looks like Cobra has a "Snake in the Grass" hmmm ......................"

Huh, over half a million shares buying today so far before noon and no word from Cass commenting on our "big, big buyer" after commenting the above yesterday about a "big, big seller"? How strange, almost as if they do have an agenda after all

Yeah, if you wanna selectively pick 2 trade prints and fully ignore that this morning also was a 20k£ buy at 4.60, then I feel it's rather pointless to engage in discussion with you because you seem to have an agenda. If you want to discuss actual fundamentals/valuation, go ahead.

What "big big consistent seller" are you talking about? Daily volumes haven't been large lately and price has been as stable as it had been in a long while between early Dec and now, so you can put 2 more rows of "......................." behind your sentences or add a tenth exclamation mark, it doesn't make the content any more compelling.

not sure what some people want honestly.

boland has been first looked at in 2023, the other 3 high-grade target areas have been added in 2025, a gold asset has been sold for non-dilutive financing in 2025, the company is extremely economical with budget, having raised less than 10m£ in equity in total since 2019 at small discounts or even at premium to sp on one occasion, and making big progress deploying that budget over those years. which is also reflected in the share price, being up 300% over the past year.

manna hill has been the second project and only added to cobra less than 6 months ago.

there's pretty rapid progress with both projects, there's a solid share register with at least 60-70% of outstanding shares in lth hands (including the 40% that are held by the significant shareholders and our institutional shareholder), it's been an extremely lucrative year for anybody who was a shareholder a year ago. and still people are ****y because it's only mad them 3 bags so far rather than 20 (which very possibly it will, just not in 1 month's time?