Member Info for Steve4077

Very positive message overall with no surprises. Looks to be a very interesting six months ahead.

I can see it fine on here:
https://www.lse.co.uk/rns/XTR/final-results-xprinh91xlqjgnf.html

Yes, you make a good point. Too many people fixate on grade, when it is only one of many different factors to consider important factors. Here is a repost of something I originally posted back in March.

"There are two major categories of cost; capital and operational. The first is buying the equipment and building all the infrastructure you need to support an operational mine. The second is the cost of actually running the mine. Let’s assume for argument's sake that the operational cost of extracting 1 ton of metal is $1000 and the metal is worth $2000. If the capital cost is $100m. you need 100,000 tons of metal to break-even. Beyond that, you can make a profit. A third 'cost' is the level of risk. What is the chance that some external dependency is going to cause delays or prevent the mine operating?

Capital costs are hugely affected by the location of the mine. If you need to build a railway or a road to a mountain in the Andes, that is very different than being a few miles from the main highway to Sydney. Equally, you need to get the metal or ore to the consumers. If you are near a major port for example, that helps a lot. The ore needs processing, so you will need to build the necessary plant, unless there is one nearby that you can use.

When it comes to the actual mine, digging underground to reach the ore is far more expensive and risky than simply digging a large hole in the ground. That is why near-surface ore is a LOT less expensive to extract per ton. Also, even if there is a high percentage intercept at a few hundred metres, that means you have to dig through a lot of dead rock to reach it. When you look at the average ore percentage per ton mined, you can't just look at the ore-bearing rock - you need to consider all the rock you need to get out of the way first.

The great thing about porphyries is the consistent grade. You are continually extracting rock that is valuable, which means consistent income and consistent offtake.

Risk is another major factor. If you have unstable governments or social conditions or anti-mining lobbies or legal challenges, it can make the mine too risky to build.

In this case, it’s not that the Bushranger grades are amazing grade in absolute terms (ignoring everything else) but it is amazing relative to cost and risk You have a huge amount of ore, which massively reduces the impact of capital cost. You have near-surface ore, which means it can be extracted via a much cheaper open pit. You have existing nearby infrastructure and transport links and a port. Finally, you have a very friendly jurisdiction, which takes away most of the potential risk.

All-in-all, that makes a very good investment. Great potential returns with minimal downside"

Closing price was below the real bid, caused by uncrossed trade of 64 shares or £2.18 :)

Welcome on board if you are not already invested. Congrats on the entry price :)

The 2011 open pit study (linked yesterday) used 0.2% and 0.15% as example grades and included a 0.2% JORC. So the answer to your question is definitely yes.

If you can wait 2-3 weeks, we should see the updated version of that study.

I did say that the other day. More staggered now, although still moving ask lower on minimal volume.

Ask: 3.4, 3.45, 3.5, 3.65, 3.7, 3.8, 4.1
Bid: 3.3, 3.3, 3.2, 3.15, 2.9, 2.75

Replying to my own post :)

Given how few shares have actually been sold in the last month or so despite the drop, I am now wondering if this is being forced down to try to free up shares. I've posted about some odd MM behaviour in the last week or two (mainly around the Ask being pushed down during periods of buying).

I've checked some other similar stocks and the XTR drop is exaggerated relative to the volume traded (almost 20% down in last five days with less than 2% of total shares sold (total volume 3.25%).

The MMs don't make money if no one is buying or selling, so maybe the fact that XTR shareholders seem keen to hold on to their shares is resulting in the MMs moving the price around more than normal to try to create liquidity. Anyway, that's what I am going to tell myself. Big drop is a positive indicator :)

I thought it might be worth comparing the recent fall in share price with the volume of trading. XTR was last at 5p on May 20th, about 5 weeks ago. Since then the total volume of shares traded has been 14.4% of the issued share capital.

When you consider that volume includes buys as well, the amount of shares sold is less than 10% of total shares held (perhaps less as some shares were probably traded more than once).

From that we can conclude that 90%+ shares have been retained by shareholders despite the 30% drop in price during that period, which is actually pretty encouraging. It certainly doesn't suggest any serious concerns about the company, but rather highlights a large price drop without any significant selling volume.

BTW since the price was 4.5 on June 3rd, the volume traded is less than 7%, including buys.

>> If this goes below 3 then i will be in again everything points to this going more south

Pyo88 - how come you aren't already invested? After all you said....

27 May 2021: "If it goes below 4 i'm in again probably sell on 8 in a couple of months"
07 Apr 2021: "If the SP goes below 6 i will be in again HOWEVER in all sincerity i have to say it does look like it will go up"
07 Jan 2021 : "I will be topping up if the sp goes to 1.5"

Well, I can safely ignore all the research I have done on KEFI, now you have let me in on the secret that 'Africa is dodgy'.

Have you considered that a dismissing a continent that is larger than China, India, the contiguous U.S. and most of Europe combined and comprising fifty-four different countries, as 'dodgy', might indicate a lack of detailed research behind your assessment?

BTW, did you know that apart from Bushranger, all of XTR's projects are in Africa? :)

And yes, KEFI is much riskier than XTR - I said that in my follow-up post.

BTW please don't take the below as a cross-ramp. KEFI is a much more risky option than XTR and a lot can still go wrong. There have been many, many, false dawns :)

It is certainly possible. I'm also invested in KEFI, which is putting together a £300m+ finance package to build a mine and only has a market cap of £40m. Plus it has other major assets in Saudi. It's taken a long time to pull together, but appears to be imminent.

If KEFI can do that in Ethiopia, during three states of emergency, a local war and a global pandemic, while needing to build roads, power lines and move villages, I have no doubt that XTR could build an open pit copper mine in the Lachlan Fold, even if the expenditure was multiples of the market cap. However, I just don't believe that is either the correct or currently favoured strategy given the existence of the AA buyout clause.

>> Do you think Colin is open to XTR on their own to develop and mine Bushranger? Ie go ahead without a deal with AA or another major.

Colin is 77 so I don't think he will be aiming for actually building a mine. I think he is more likely to state he is building a mine to force AA hand. Although personally, I think they need to finish phase 2 before making any decisions, or maybe agree a deal with AA that includes some part of future discoveries..

That is very interesting. It is based on 125,000 tons of contained copper (0.3% cutoff) vs current JORC of 350,000 tons. It also has a 0.2% cutoff version which increases the resource by 50%, so that is probably a good guide to a similar view of the current Bushranger resource: in excess of 500k+ tons at 0.2% cut-off before any of the phase 1 drilling.

The Capital cost is estimated at AUS 98m, about $53m, for a 2Mtpa concentrator and associated infrastructure.

Cost is so low because "Bushranger is located 25km south of Oberon in the Lachlan Fold Belt of New South Wales, in an area well served by existing infrastructure. A high voltage power line traverses the property, and water is potentially available from a large regional dam nearby. Access to the rail network would be via road haulage on a sealed road to the nearest rail head 25km away."

Given the JORC is likely to expand considerably in the next 12 months, the capital cost would probably be higher so they could have greater annual production. Lets assume a millions tons of contained copper at 0.2% cut-off, or about double what we have now (but only half the AA buyout amount). That is about 5-6x the linked scenario. Lets assume a long mine life is desired, maybe 25-30 years, so they increase the desired throughput but not linearly. Maybe £100m to £150m capital cost (accounting for some inflation since 2011).

I am sure people with more expertise than me can ballpark it better.

>> If you blindly stick your drill in a few times, you're unlikely to score well.

I really did LOL :)

Looking at L2, the price seems to be going down despite buys being much greater than sells and volume averaging less than 0.5% of shares each day. Also, there are a couple of MMs that seem to take any opportunity to push down the ask, even with no sells coming through. Its very odd. It might be just delayed sell trades, but its been a consistent theme in recent days.

On the other hand, I'm not really sure why the MMs would seek to push the price down, beyond some form of tree shake. Any ideas out there to support my vague conspiracy theory? :)

>> I am thinking hovering around 3.5p is bottom...upward from news flow....to the jorc open pit report ...Mid July...

I've given up worrying about the bottom :)

I'm not selling anything in the next few months, so what the price does during that period is irrelevant. I guess I could have made money by selling higher and buying lower, but that is just 20/20 hindsight. Worrying about what might have been is just futile and frustrating, although I still do it from time to time :)

If you have conviction on this stock, then hold and ignore the price (which is moving a lot on fairly low volume) because if you are right about the stock, the price will fix itself over time.

>> It's interesting the height above hole 1 that hole 6 hit mineralisation and intersected.

Also the depth and increasing grade of 2, 3 and 6. Perhaps the known mineralisation is running into a different zone of mineralisation and they just happen to cross near hole 6. Maybe another finger porphyry or the fault zone mentioned in your blog. As you stated in that blog "The heavier mineralisation would have re-treated down, to the larger fractures closer to the intrusion, and possibly closer to the fault zone?", which is in line with the increasing grade at depth.

Another deep hole to the North-West (left on the side-on diagram) would be interesting to see if it encounters anything that starts even shallower than hole 6 and goes down a long way. That would be in line with the large and deep return on line 11700N of the IP Survey.

I have Pyo88 filtered, so I assume is he one of today green boxes :)

He isn't a shareholder. He is just one of those odd schadenfreude characters you find on some boards who turn up to gloat when the share price drops (hence the filter).