Member Info for Strangerstill

Make sure that you vote against this derisory offer. If you hold shares in a SIPP or ISA make certain that you can vote through your fund manager. I invest with Interactive Investor and can vote on every resolution for the companies I hold shares in. II send me notification of eligible resolutions and I can vote through the II website.

At present Ganfeng's increased holding in Bacanora has not had Chinese approval. Ganfeng currently holds 17.4% of Bacanora shares. There are a lot of different investors in Bacanora including about 40% of small investors not including people invested through the likes of Hargreaves Lansdown. Even after the increased shareholding for Ganfeng the small investors hold about 35% of Bacanora shares. Bacanora is worth much more than this offer price and the investors should at least force Ganfeng to offer a reasonable price for the shares. It is up to the shareholders both small and institutional to reject this low offer and force Ganfeng back to the table. Below is the information I have been able to get re the number of shares currently held (if the table posts correctly).

Current After Ganfeng
increased holding
Name Equities % %
Ganfeng Lithium Co., Ltd. 57,600,364 17.40% 28.88%
M&G Investment Management Ltd. 52,528,941 15.90% 13.67%
Hargreaves Lansdown Stockbrokers Ltd. 20,275,000 6.13% 5.28%
Robeco Institutional Asset Management BV 16,280,000 4.92% 4.24%
Hanwa Co., Ltd. 12,333,261 3.73% 3.21%
Hargreaves Lansdown Asset Man Ltd. 10,056,000 3.04% 2.62%
Igneous Capital Ltd. 9,883,774 2.99% 2.57%
Henderson Global Investors Ltd . 6,885,000 2.08% 1.79%
Capital Research & Management Co. 6,438,925 1.95% 1.68%
Jarvis Investment Management Ltd. 5,908,000 1.79% 1.54%
Others 40.07% 34.52%

Good results from Ferrexpo today, it has been a wonderful investment for me and since my initial investment in 2016 the cost of shares £32,527, value of shares £154,953 and dividends to date (not including the special announced today) £19,216.

Also P S stated that initial production w will be 20,000 tonnes pa up 14% from initial plan whilst capital costs are down 2%.

Is Ariana seriously undervalued? I think so. Below are some back of fag packet calculations. Please feel free to comment.
The management team seem to be fairly confident that with a capital spend of about $20 million they can turn Kiziltepe and Tavsan into a 50,000 oz gold per annum operation with a life of mine of at least 10 years.
Assuming that the price of gold stays within a range of $1,200 to $1,800 per oz (giving an average of $1,500 per oz )and our C1 cash costs can be contained at below $800 per oz then Kiziltepe and Tavsan will make about $700 *50,000*10 = $350 million. Assume extra capital spend of $20 million through the next ten years and you get $330 million . Ariana has 23.5% of the profit so that is $77.5 million. Discount this by 50% to account for any unforeseen events, tax, etc. and this gives the net worth of Kiziltepe and Tavsan for Araiana at about $38.8 million (not far off what Ozaltin are paying for their share). Then we have to add the value of Ariana’s prospecting business (both the JV and Venus Minerals will be paying Ariana to undertake any prospecting work carried out on their behalf) and the potential value of Salinbas and any prospects in Cyprus.
Current market cap of Ariana is £47.3 million which is $65.6 million. Ariana is getting $37.5 million for 50% of its Kiziltepe and Tavsan gold mining operations and Salinbas so the remaining 50% is being valued by the market at $28.1 million which is over $10 million less than the real value of Kiziltepe and Tavsan never mind Salinbas and the rest of Ariana’s business.

Developers plan to build what they say will be the world’s biggest large-scale battery in the New South Wales Hunter Valley, the latest in a flurry of major energy storage projects announced for the national electricity grid.

CEP Energy said its $2.4bn battery at Kurri Kurri, north-west of Newcastle, would have a power capacity of up to 1,200 megawatts – about eight times greater than the battery at Hornsdale in South Australia, which was the biggest when it began operating in 2017.

https://www.theguardian.com/australia-news/2021/feb/05/worlds-biggest-battery-with-1200mw-capacity-set-to-be-built-in-nsw-hunter-valley-australia

The big issue with hydrogen powered cars is that there are only two viable ways to make hydrogen;
cracking oil which produces lots of CO2 or
electrolysing water which requires lots of electricity so a large amount of wind or solar power thus needing a lot of rare earths.
It is about 30% less efficient to produce hydrogen from electricity to fuel cars than it is just to charge up car batteries so the running costs would be 30% higher. The electricity generating infrastructure would have to be 30% larger and consume even more materials including rare earths. Car batteries are becoming much cheaper, having a much higher energy density and a much faster recharge time, the attractiveness of electric cars will only grow with time. Car battery technology is developing batteries that need fewer rare earths and expensive materials like cobalt. I do not see that hydrogen technology has a future except for the oil companies who will be able to sell it, at a profit, through their forecourts.

Thanks M20ASH for the info.
Trawling back through the RNSs the $35.75 million is made up of $25 million for Ariana's stake in zenit, $5 million form Ozaltin for its stake in Salinbas and $5.75 from Proccea for its stake in Salinbas. The RNS does not make this clear.

I am quite happy with the dividend being paid out. I know that some people would like to see all the cash spent on exploration but there is a limit to the physical amount of exploration Ariana can carry out with its existing physical resources. Ariana will still have £12 to £15 million in its war chest to spend on exploration plus a stream of future profits . I would rather Ariana pick its prospects carefully and engage in a profitable programme of exploration than just throw lots of money at prospects that are marginal.

If I read this correctly Ariana will own 23.5% of Zenit (23.5% held by Proccea and 53% by Ozaltin), Zenit owns Kiziltepe and Tavsan, etc. Ariana will still own 47% of Salinbas having sold 53% to Ozaltin, there is no mention of a sale of any stake in Pontid to Proccea.

By my calculations, taking the figures in the RNS with a tin concentration of 350 ppm and a WO3 concentration of 1050 ppm and a recovery rate of 53% for tin and 40% for WO3, for each tonne of ore WRES is recovering 0.1855 kg of tin and 0.42 kg of WO3 a ratio of 2.26 WO3 to 1 tin.

Ganfeng have an option to take their shareholding in Bacanora to 50% and yes this would mean dilution.

PS probably has no say in a potential sell out, I suspect that the key investors, M&G, Ganfeng and Hanwa will dictate what happens going forward. My opinion is that Ganfeng will put in the necessary funding and the mine will get built with Ganfeng eventually holding a 50% stake in Bacanora Lithium. Ganfeng want control of the output without having to stump up the whole cost of building a mine hence Ganfeng will not sell out to any other concern and are sitting pretty with long-term control of the output for only 50% of the cost of a mine.

Reading the production RNSs it is apparent that the main problem is the recovery of WO3 due to the low grade ore and the fact that the ore has a large proportion of fines.
From ‘Recovery of Tungsten Values from Low Grade Ore’ http://www.techno-preneur.net/technology/new-technologies/metallurgytechnique/lowgradeore.html
The available Indian deposits are of very low grade ranging from 0.04 to 0.2 % WO3 against the commonly exploited ore grades of 0.5% WO3 world over. La Parilla with mineral reserves of 29.7 million tonnes (mt) at 931 parts per million (ppm) or approx. 1% ore grade is similar to the Indian ores
The existing process for the beneficiation of tungsten ore basically consists of processing of the ore by physical methods like gravity and magnetic separation to get the concentrate. But considering the low metal content and the fine dissemination of tungsten bearing minerals in the gangues in the run-of-mine ore, normally it is difficult to get the desired grade of the concentrate. Alternatively, efforts of obtaining a high grade concentrate by fine sized pulverisation and multi-stage processing leads to high losses of tungsten values
The problem for La Parilla is that the fines content of the ore is very high at present although from the June quarter RNS it would appear that the ore mined in future should reduce the proportion of fines. The improvements that have been carried out are all to reduce the amount of fines from the pre-concentrator stages and to increase the recovery of WO3 from the fines at the concentrator stage. Whether W Resources manages to improve the recovery of WO3 to the point where the plant is profitable will have to be seen. I suspect that they will be able to up recoveries substantially in future. The big question is why the plant was designed in such a way that it could not recover the WO3 efficiently, surely the composition of the ore must have been known at the time of the plant design.
Key information for the production RNSs
March
Key initiatives implemented include the installation of deslime cyclones ahead of the fines circuit and a hydrosizer ahead of the shaking tables which are complete and operational. Work is underway to install cyclones ahead of all spirals to improve density control and desliming which should materially increase concentrator plant recovery.
June
Key initiatives completed in the quarter include the installation of four hydrocyclones to feed the spiral banks, which has resulted in a much more precise control and stability over the density of the feed and a better operation of pumps, or the change of one of the roll mills in the jig plant by a Vertical Shaft Impactor (VSI), which has proven successful.
Blasting has reached the more competent ore reducing fines in the processing operations.

Pablo gave the reassurance that the plant at La Parilla was operating smoothly which is very reassuring. Oh, wait a second, that is like me saying that my car engine is running smoothly when the gearbox is shot and I cannot get the car off the drive.

WResources has built a very good tin mine but a poor tungsten mine at La Parilla. Recovery of tin is well over 100% of that planned in the feasibility but WO3 recovery is running at about 13% of planned. WResources appears to think that the main problem is in the jig & mill pre-concentration plant which is producing pre-concentration ore that is not to specification for the concentration process. The concentration process depends on having the pre concentration ore presented to the concentration process (spirals, shaking table, flotation and electrostatic separation) in a consistent physical state including a consistent size of ore particle for the physical ore separation to be effective. If WResources can fix this with tweaks to the existing plant and the new plant that has been ordered then in the medium term the mine should get production up to the planned rate. The big question is can WResources survive in the short term without having substantial share dilution.

MM’s mid-July may be like the mid-life crisis WRES is causing me. I am 65 and even though I am probably at least 75% of the way through my life I consider myself in my mid-life. MM probably has the same view about July so expect the production results in the last week of July.

This from the Mexican press that does not mention nationalisation but does mention that the Mexican government is in talks with Ganfeng to build a battery factory in Mexico.

Toledo said that the Mexican government is looking to begin manufacturing EVs in state-owned factories. Sonora Economy Secretary Jorge Vidal also said that his government had met with Ganfeng to discuss building a battery factory alongside the mine.

Picked up on a piece in the Russian press about Bacanora.

"Nationalization of lithium is sought from the government by the head of the Ministry of the Environment and Natural Resources of Mexico Victor Manuel Toledo. He said this during a webinar "The future of Latin America in the era after coronavirus and neoliberalism," June 17, reports the online edition of Excelsior."

?? ??????? ?????
??????? ???????? ??????? ?? ??????:
https://rossaprimavera.ru/news/1eb8ba88

Re the extension agreement Dr. Kerim Sener, Managing Director, commented:
"Due to the limitations resulting from the impact of COVID-19, we have decided jointly to extend the project review period until the 30 June 2020. This will enable the Parties to evaluate the proposed new Joint Venture ("JV") and the draft legal agreements detailing the specific terms of the JV. This provides additional time to enable an even more thorough review by the Parties and coincides with significant new project developments, including the revised Resource Estimate for Kiziltepe, announced last week, and revisions to our resource for Tavsan which remains work in progress. In addition, at Tavsan we are in the process of finalising the development schedule for what is expected to be our second mine in Turkey."

Reading this it seems that Kerim is hinting that Ariana and Proccea might be thinking that the share of the business that is being proposed to be sold to the new partner is undervalued. Ariana and Proccea might want a higher price for a business that has increased in value due to the new project developments or may indeed be reviewing whether to actually go ahead with the sale to the third party .