The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
There is a process flow diagram on the internet, if you search under images. Ignore their spelling mistakes. The gypsum is washed with water then leached with nitric acid and calcium nitrate (I would imagine this is a returned by-product stream). The material is then filtered producing a higher concentrated rare earth leachate (8 - 24g/L) before passing to a 5 stage extraction process (in series). The solvent used is Shellsol. The raffinate (impure stream) is recirculated back to the leaching process. The extract (the purer stream), from the extraction process, is then fed to the 6 stage stripping section (in series), where water is used. The rare earth content is now up to 45 - 60g/L. The liquid is then mixed with ammonia and oxalic acid, to precipitate ( solid) of rare earth Oxilate. This solid is then fed to a rotary calciner (rotating furnace) to produce a dried rare earth mixture of about 89 - 94% purity.
I know where you are coming from, based on value, though you missed the USD 350m that Cairn have not returned plus Senegal operation bonuses.
What we all have to remember is the Indian government stole this money and this caused a lot of skilled personnel to lose their jobs, as the company had to rationalise.
Auson,
Cairn are only returning USD 250m of the USD600m of the Senegal sale, leaving USD 350m as a war chest. There is an additional USD100m performance related bonus on the Senegal sale. On the India Tax judgement read the press statements, even from the Indian media, on the likely payment to Vodafone and Cairn, as well as the position on Sanofi. All of this plus CNE can carry out a rights issue on any purchase or leverage on the savings to be made etc. They are in a great position to pick up any distressed company assets.
Cumbrian,
There is a big difference between a normal profit derived dividend and this special dividend. A normal dividend should be paid based on the operating profit of the company. The company continues to operate their assets and hopefully generates profit going forward. In CNE case they have sold a valuable asset and are giving a special dividend back to share holders, from the proceed of that sale. Rather than just paying that dividend and allowing the shares to float, the BOD are to consolidate the stock, in proportion to the dividend, making the share price neutral. This is explained in the RNS.
What you need to understand is that CNE have operating assets, designed normally to generate a profit which is used to pay for their exploration endeavours. These assets remain and are still very profitable. What you need to do is look at the market capitalisation and make a judgement does the realised Senegal sale proceeds, the Indian tax judgement (Making a judgement on the likely payment), future Senegal payments and present CNE assets outweigh the company market capitalisation. What you appear to be missing, from your statement, is the rise from 175, occurring in December, was largely the part recognition of the Indian Tax judgement of USD1.2 bn plus addons. Before I get shot down there are other assessments to make, as an asset isn't worth much if it is loss making.
I know my view and hence being invested here, but you have to make your own assessment.
That is true and you shouldn't buy the shares on the special dividend.
CNE are sitting on a sizable war chest, after the sale of the Senegal asset. Less than half is being returned to share holders. In addition there are potential income streams from the Senegal oil field performance and Indian arbitration award. This, in part, has been taken into account within the share price but certainly not all. Assets could be acquired from potentially distressed operators, certainly in the short term. It all comes down to your perceived risk and reward threshold. I just see CNE in a very stable and safe place at the moment, when we consider the economic climate. I can't say that for other oil sector companies.
Kamm,
Yes the assessed consolidation takes place after the special dividend. Look on the Cairn Energy Investor website for the Senegal RNS and the key dates and details are posted there.
Kamm,
Yes the assessed consolidation takes place after the dividend. See:
https://www.cairnenergy.com/news-media/news/2020/return-of-us-250-million-to-shareholders-following-sale-of-senegal-assets/#Tabundefined=1
Kamm,
Not too late. You have until 8/1/21 to have registered and you will be paid the 32p per share as a dividend. The share is then rationalised at the end of the month. I topped up again this morning.
What happen when the LSE stock market closed and the US rocketed to over a 10% rise? I see no RNS or news article to prompt the step change.
Good news that RBW has a viable asset, worth the USD 0.75m investment and more.
Please take the emotion out of this. Alba have a decent team and above all keep all interested parties abreast of developments.
What does everyone think the pilot plant is for? It will be to allow Alba to carry out assay results, without sending samples down to Cornwall and incurring the cost and time delays. It is not there for production, though whatever they produce will be sold. It will allow them to carefully map the hotspots and create a strategy to exploit the resource. Alba are trying to map out that geology and are giving you the information. Are we more knowledgeable now than we were a month ago? Yes, we know how many kilometres around the hillsides these vein extend. The picture is emerging, slowly but surely. When do we all believe that this mine will be producing commercial amounts? In hours, days, weeks, months? No, years, so please be patient.
Why the slide is SP? Sentiment. Plain and simple. This is a PI driven company. Forget the MMs and there are no II's at play. You can't keep drip feeding RNS's and then bypass the PI's and sell new shares, without a large number of PI's going "Why have I taken on the risk when you remove that small reward by diluting my share?". Offer your LTH an option to buy at a discounted price, if you need money. There is no dilution, the PI's have had an opportunity to gain an advantage and it tells new investors, this company looks after the core PI's.
Phantom25:
Burundi asset breaking even in Q1 2021 is perhaps a key milestone. On a more frequent basis keep an eye on rare earth metal prices such as at:
https://www.metal.com/Rare-Earth-Metals/
Please note that RBW sell concentrates not pure metals but there should be a correlation between the two, unless there is an over or under supply in the mining sector.
NICODEMUS63
I am not a geologist but I have been to a number of phosphate plants, non of which are processing their gypsum (calcium sulphate) piles. Phosphates and calcites (calcium carbonates) are both sedimentary deposits, so are often found in the same region. The first stage, after crushing the ore is to react it with excess sulphuric acid. This produces phosphoric acid and gypsum. The phosphoric acid can then be used in other tail end production processes. The insoluble gypsum is separated out, generally as a waste product and piled up. The key question is, are there rare earth elements also within the insoluble gypsum? I am guessing, based on the phosphate plants I have been to, generally not in sufficient quantity to justify further separation.
As the RNS has stated, on South Africa, there is. Having removed the phosphate (P2O5) fraction (I am guessing 20 - 30%), the concentration within the gypsum pile is now greater. In addition the site have separated out the phosphate fraction leaving it easier and less costly to further concentrate the rare earth elements.
It is sitting on the US float money and funds by not paying a final dividend because it has core objectives. I topped up at 1250, in October, regretted it for a week or two and then have seen it rise and steady, which is something I wish GSK had done. You can't be successful all the time and you can't always time it correctly.
Alba is a long term play. Extracting gold, in the case of the Welsh assets, in meaningful amounts, will take years and money. This pilot plant separation plant, is just that. It is for small scale production but at this stage assaying. Once a more complete picture of the deposits is gleaned, then a plan of action can be mounted by the geologist and BOD.
I have been critical of how the BOD have gone about getting additional funds but not that they need funds. Yes it has affected sentiment and sentiment drives the SP. Giving money back is not the right move atm. Alba management have been open, more open than most. Let them get on with the work and see where this journey takes us. All the indicators are positive, except the SP. The SP will move when sentiment returns and more positive news cannot be resisted for ever.
Very few AIM companies do it but a shareholder rights issue, especially for such a relatively small sum, would have been the more accepted approach. LTH already know the company, have a stake in the company and do not want their investment diluted. The company needs the money, it is a rare win win outcome. However going behind shareholders backs, with the RNS placement, undermined confidence. Hopefully it will be temporary.
They had yesterdays date, so reasonable assumption. Must have taken time to fill.
Bishop_Basher, did it say "Groups will attack in packs if not towing the line"? :)
7 million shares sold within 12 minutes of the perceived excellent RNS yesterday, almost as though the sellers knew this was the correct option. I like many topped up, at a time when this selling was being filled, behind the scenes. To say I am annoyed is an understatement, with todays money raising effort. Why did they not try a shareholder rights issue at 0.37p? At least then shareholders would have the ability to raise their value in the company.
Interesting that 7 million shares sold within 12 minutes of the RNS. It took a few hours for these to fill, meaning that purchasers did not drive the price up, as would be expected.