Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
100% JV
We cant go on like this
smiller- its a good question to ask- why now?
when you look at the current account balance, it doesnt make sense. If this had come in Jan or Feb- would have been a different ball game.
Which is why I always say- the BOD/BBG are not your friend, partner or soul mate. They are businessmen who wouldnt know you from Adam. Even Max is probably unknown to them. Its pathological to place so much trust in them.
they have also said they were fully funded for the same projects- again.
Not sure how you can misread it.
Fully funded for all the drilling we have planned in Mexico and Oz, now its the same- how many times can the same projects be 'fully funded'?
We were told that they had taken a break for the rainy season.
Other miners in the region are back to work.
I looked up the weather for Nielle- 36 degs and sun for next 2 weeks.
It is not JUST about the lithium license, what is the delay to our gold concessions? Time is of the essence before the next rainy season in June. You start now- you can get 2 rounds of drilling done.
So down to placing price, quicker than I thought. Maybe best to get it over and done with.
I've just been in contact with Mexico again- the BOD cant keep on asking for money for a stalled project- nor can they keep on saying that current projects are funded then going back to these destructive placings for the SAME projects.
I'll email the directors directly again for further clarification as I have their emails- especially regarding the fully funded for next 8 weeks nonsense.
So another placing, somewhat unexpected when you look at how much cash we have in the bank and repeated utterings that we were fully funded for current drilling programmes including Mexico.
I did expect a placing, but I thought it would come after the next Hanc0ck drilling assays. This is what needs to fleshed out- what EXACTLY is the money being used for? Either they were lying when they said we were fully funded for current drill programmes in the last company accounts, or this money is something additional to action the scoping study. Putting it all under one umbrella is not good enough.
This has been very deliberate- lot of proclamations, tweets, PR then drop the placing at a significant discount so take advantage of the market. This would have been in the planning for a while. Some here are of the impression that the BOD are all fluffy bunnies- they are not. They are calculated wealthy business men who do what calculated wealthy businessmen have always done. Bare in mind, that between them- they have invested in a measly £60k (just one director-Mark Cuthbert if I recall) into buying UFO shares over the last 12 months. Really not a lot considering. A bit of a red flag IMO. I spoke to them (2 of the directors) via email some while ago when the SP was at its lowest, and they said they had complete faith in BBG- my response was that if they have such faith- why are they not buying up shares? £60k between several wealthy people is like pocket change. I never received a response to that point. Does anyone know how much the BOD is costing us in salaries?
Regarding Mexico- they keep on saying they need money for exploration. But nothing much is going on there. Imagine your builder keeps on asking you for money to build something, yet each time you see the house- they haven't started construction. That is where they are at with Mexico right now. Seems it is being used as bait to justify a larger placing.
For those who dont know me- I posted here some time ago that I had been able to contact the Mexican Ministries of Mines and Environment (check my posting history for the OT) which was basically at odds with BBG's proclamations that there was a standstill in the Mexican government which had resulted in the delay of permits. Essentially, I had caught him out redhanded. (FYI- it was 1 year ago that BBG told us that the permit for Mexico will be achieved 'any day' now)
My gut feeling is that we will head down towards placing price, as is normally the case, then EH assays and Phase 3 drilling in December will drag us back up. This placing wont be as disastrous as the previous ones as we have been significantly derisked.
But I am going to have to see some evidence of something major in addition to the current drilling programme to justify this huge (relatively) placing.
Also- what do they mean this should be enough for end of 2021? We have 8 weeks left in the year.!!!
So I read the accounts on my cracked phone screen so I wrote the above when I was under the impression we have 0.7 million in cash instead of 3.7 million
While this weakens my argument. I think the general message is correct. We NEED a JV or some other good news, or this is heading towards 0.5. It wont survive at this level of 0.8 if we have to wait till March for the 2nd JORC
Thoughts?
Last chance saloon for BBG?
Just read through the half yearly.
As predicted, the maiden JORC was already priced into the SP. There was a minority of us who have been saying that for a while but there was too much ramping. I think those who, for the last year, have ramped and said that it wasnt factored in- need to put up their hands and apologise and admit they were wrong. And I hope others who were taken in by what they said, will not listen to those individuals in future and take a more pragmatic view.
This company had no right to be at the £50-60 million mark it held for much of last autumn. For that, we only have ourselves to blame by allowing ourselves to be spiked. We cant blame BBG for that and I will be the first one to admit I got carried away with expectations. Actual real progress is still catching up with the mcap and one could argue that the company is still overvalued when you compare to its peers. The crazy and unjustified rise in price last year must have put BBG under a lot of unwarranted pressure.
The selling point of ‘multi-asset’ can no longer be used to justify its premium as the copper play at Donovan failed, and Lizzy Hills is still at a very very early stage, meanwhile our other sites in Mexico have not made any progress and I was dissapointed to see BBG using, yet again, COVID as an excuse- when that is clearly not the case. He is, of course, very aware that most Pis are not on LSE so are oblivious to my expose on that front.
We are running out of cash faster than the Venezuelan central bank. A placing must be on its way, unless BBG can get us a JV on the DSO within the next few months. BBG is saying ‘hopefully’ we start Phase 3 drillings by the end of the year. I don’t see the reason for the delay. ‘HOPEFULLY’? That already sounds ominous, lets say it DOES happen in December- we are still talking of March before get results and maybe April till we can have a JORC on the Western Ridges and firm up our calculations on Sirius. Australia is not a cheap country and skilled technical workers are paid a fortune.
Donovan has been the undoing of UFO, IMO. If it had been a success, things would have looked very very different now. We would be in Phase 2 or 3drilling now and a JORC would be round the corner. Maybe our SP would be closer to 2 than 1.
I do not have confidence in BBG’s commercial acumen, but lets see if he can pull a JV out of the hat. If he doesn’t, this could well plummet towards 0.5 or less on the next placing, especially with current iron ore price direction.
The moment of truth has arrived- Go JV or go broke.
AH, I read it wrong. I thought it was 0.7 million in cash now. Okay, 3.7 million is decent then.
Napthan, are you willing to put your money where your mouth is?
How much do you think we will rerate now that we have an *inferred* resource of 10MT?
Well lets see
Im really hoping we can get some advancement in EHs as im not confident about the short/medium term prospects of iron.
Silver will give us something else to play with
I dont pretend to be a technical man, unlike most of the people here.
How much work needs to be done to reach measured? More drilling or more analysis, or both?
Im acutely aware that we are burning through cash
This has all been priced in, more or less.
We will need
1) Western Ridges JORC
2) EHs good results
3) advancement of Mexico
and ofc the holygrail
4) JV for the DSO
Before we see any significant upward adjustment.
HH, good question to ask but i assume TP have not just made up that figure. Shouldnt be too hard to find out.
Ignore napthan, he runs a recruitment company. I worked via such companies in the past and I rank them along with estate agents and used card salesman in terms of the human ladder.
after one year, people are still playing the MM card, really?
@HH, I mentioned it in my post. Yup, I spent quite a bit of time in Brazil so have many friends who work for Vale as engineers. They are gearing up to get back in the market, big time.
Im confused though- when the iron price was soaring- it was mentioned here every second. When its going down, we are being told to "not read too much into it".
This will significantly affect any potential JV discussion. "Significantly" is a understatement
Time for BBG to get his ass moving on EHs
Why would that mean I should sell, that makes zero sense.
As I have said, and as Stargazer said many times- it has all been factored in- apart from an actual JV. When Stargazer said that at 1.3 or thereabouts, he was laughed at. Yet we are round the corner from a JORC with a SP of 0.8.
Now if we get a 2nd JORC with Western Ridges, then that changes things ofc. But the current expected maiden JORC wont do much, but it will at least derisk us and prevent a further decline below 0.8.
One of my good friends in London is from Perth, while he doesnt work in mining, he knows a tonne of people who do.
In February I tried to find some 'on ground' info on UFO through this friend. He reached out to some contacts, and while they werent familiar with the company (I am literally re-reading the whatsapp message from 22nd Feb) one told me to stay away from iron ore as it was a bubble and was about to crash. He said the Chinese had artificially stimulated demand and there was now over exploration in Oz which would mean a future glut when those projects come to fruition.
People are always predicting bear markets so I didnt take much notice and tbh I havent been following the iron price so was shocked by how much it has fallen.
This makes our non-iron projects even more important now. We were sold UFO as a "multi asset" company. Looks like they betted on one horse..which was made of iron.
EHs should have been drilled months ago, we would be into Phase 2 or 3 drilling now and maybe close to a JORC
Donovan, had it proven to be successful, would have been at least in Phase 2.
And then there are our other prospects in Mexico which havent budged. Despite us spending money on a salaried local geologist. Well at least I have stopped Bill using COVID as an excuse. He hasnt mentioned that excuse once since I exposed his misrepresentation of what was happening in Mexico.
I think it would be foolish to go back into Donovan, especially with our limited cash. We should concentrate our efforts in Oz, to get the JORC for the Western Ridges (which is even more important now due to the iron ore plummeting) and drilling EHs. We need some sort of non-iron JORC to offset what is currently happening and silver seems our best play. There is too much work needed in Mexico now for us to open up a second front, it would be very costly.
Im hoping we can start Phase 3 drilling soon and get a 2nd JORC for the DSO by end of year and with them both, we can enter some JV. The question is, who is going to be looking for iron in this current climate? The midtiers and majors are already down today. Why would they want to add to the glut?
The reason I invested in UFO was I envisaged progress in silver, iron and copper so if one went down, you would at least have the other 2.
Really surprised noone has mentioned this. Biggest news in the markets for some time. People post inane videos from youtubers but not actual important things happening now. If this falls, this could be the Lehman brothers of 2021 China- who knows the knock on effect
Evergrande is close to collapsing.
From The Guardian:
"The contagion factor was most visible in Australia where the benchmark ASX200 index closed down 2.1% on Monday afternoon as investors dumped mining stocks such as BHP and Rio.
The price of iron ore, Australia’s main export, has fallen 60% to below $100 a tonne from its high point in May thanks to a slowdown in the Chinese property and construction sectors. If Evergrande collapses, the sector’s difficulties are likely to accelerate, sending iron ore lower still.
Futures trading points to falls in stock markets in Europe and the US on Monday with the FTSE100 on course to shed 1.3% at the opening bell. Concerns about the Federal Reserve’s plans to phase out its huge monetary stimulus policy, surging Delta infections in the US, and signs of a slowdown in the global recovery are all being compounded by the Evergrande crisis.
The Fed’s policy meeting this week is being closely followed, with some experts predicting it could set a timetable for winding in its vast bond-buying programme put in place last year to support the economy and equity markets"
From The DM
"As recently as July, iron ore was worth more than $US200 a metric tonne.
But a cutback in Chinese steel production saw iron ore prices fall by 21 per cent in August.
Iron ore prices are now down to $US100 a tonne for the first time in 14 months as Brazil also looks set to boost supplies, two years on from the Vale tailings dam collapse.
This means China has more choice beyond having to buy the commodity from Western Australia's Pilbara region.
Prices for the key commodity fell by another 5.5 per cent during the weekend, following a 22 per cent plunge last week."
I think the JORC has already been factored into the SP. I have 2 other AIM stocks which have issued maiden JORCs in the last months and there was a temporary uptick in SP before settling back down to baseline.
We need some form of JV news or a major advancement in other projects. Nothing short of that will ever get us anywhere close to our old baseline of around 1.5.