Member Info for tedoby

2857mal - exactly right!

If it all falls into place the opportunity here is huge!

It was good to hear GR say the initial reaction on the proposal from the City was good.

I was also very pleased to hear Newco is going to be domiciled in Guernsey. So no tax and no stamp duty to pay on trades!

GLA

Billthebank I agree. Circum has got an excellent chance of coming good.!

But I also think we shouldn't lose sight of RHA at KME’s first milestone of 16,000t’s of ore hitting the ROM pad.The timing of Circums IPO if that’s the way they go and the first milestone on RHA could be very close.

The value of Prems holding in Circum whatever the corporate event should be worth far more than $6m at that point. My guess FWIW is over £20m which would be 0.3p a share.

The 16,000t’s/month ROM at RHA should produce at least 5,000 Mtu’s APT/month. The underground mine rate should be around 6.000t’s/month at roughly 0.55% grade and the other 10,000t’s from either or both the pit and tailings should produce grades of not less than 0 25%. The saving on cost with KME as the operator should reduce the breakeven point to around 1,500 Mtu’s/ month.

If all of that’s about right we’re looking at a monthly net profit of $600 and an annualised profit of over $7m. Applying the earnings metric that would give RHA a Market Cap of $70m if the p/e ratio was 10 which it should easily be.

If george is conservative when he says Prem shareholders should retain between 50% and 60% ownership that would give shareholders in Prem today a notional MC of $70m x 60% + $42m which a todays exchange rate is about £33m so 0.44p with 7.5bn shares in issue.

Combining the two and not counting Zulu which is the big one we could see a notional SP for Prems shareholders of 0.30p + 44p = 0.74p from Circum and RHA in less than six months time.

As I say Zulu hasn’t been included and fro there RHA’s ROM is set to improve up to $40.000 Mtu’s APT/month benchmark which should be achievable in less than 18 months to give the mine a MC of over $150m at today's prices.

AIMHO

GLA

Phillip1976 can I ask where you have this from please?

"The only issue I foresee with the RNS is that the value of shares you have in Pren will not be transferred to Newco."

GLA

One of the best ways to raise debt finance is through an off-taker. They're often prepared to lend at a couple of % above LIBOR.

Any equity finance raised would affect all shares and would probably be best dealt with via the IPO.

Hopefully Newco will attract Institutions is it's handled well which would be great and I can't imagine the Chinese not being interested.

AIMHO.

chris that sounds right to me.

GR referred to a special dividend payment from the Circum holding in one of the Webinars as I recall.

GLA

steward for me it's got the makings of a much better deal than the one with Cadence. I'm not just talking about advantages such as retaining control of marketing and such like which we would have lost with cadence.

One huge advantage of having an experienced operator with owned plant running the mines is the saving on costs. Take the Cash Costs at RHA for example. At the 16,000t/month ore to Rom Pad stage RHA should be producing around 5,000 Mtu's p.m.

CC's ordinarily from the BARA report would have been something like $120/Mtu so $6m for the year. With Newco we may see those halving or close to it in my view and the saving go straight to the bottom line. In itself that's a considerable saving but it will be exponential up to the targeted 10,000 Mtu's p.m. with the added benefit of economy of scale.

I think we'll hear GR make more of this really important point for us in the Webinar tomorrow and it certainly shouldn't be overlooked.

GLA

I could be wrong here but I think Prem for legal reasons my either have to give shareholders in Prem the choice of either keeping their shares invested in Circum or returning them as a dividend payment when the time is right to shareholders advantage. Say at the point of the Circums corporate event which could be nice.

We may find he has to do that for legal reasons and if I remember right he alluded to as much in one of the Webinars. I'm pretty sure he not allowed to control shareholders investments without giving each a choice. Especially if the share are put in a lock-down period. Given the choice I think I'd rather invest mine in Newco and Zulu.

Any advice or thoughts would be welcome

smattock there should have been more said about them in the RNS I think. KME are part of Afmine if you want to Google them .The personnel and team involved are the same I believe.

GLA

Snowking I think the initial equity split may be slightly more complicated. The £6m finance could be a mix of equity and debt not to mention the government may still want to keep its 10% of RHA.

GLA

Many congratulations Charlie. I hope mom and baby are doing well.

CF Strongman and all other genuine shareholders.

What were seeing is not only the start of restructuring Prems assets but also the formation of a new company that is capable of monetising them.

The assets haven't changed but the j.v. as I say will be the key to unlocking them.

RHA could give a MC contribution of at least £100m producing around 12.000 Mtu's APT per month and Zulu MC contribution could be well over £1bn by producing a combined concentrate of around 200kt's per annum. I believe KME with it's expertise and local knowledge has the skill set nesessary to take us there!

AIMHO

GL

pkwendall thanks for the link. Very interesting.

Wolf in administration gets a mention as does Prem about 3/4 of the way through the interview which is good to hear.

I'm a simpleton but in my mind the strike in RHA's pit as we know runs from east to west with grades improving the further west we go towards the underground shaft. So in my eyes we have an ever moving imaginary line at right agnles to to strike that divides the economic ore from the uneconomic. The east being determing as currently uneconomic but we could see that changing.

That line moves according to the cost and values which are governed by the prevailing APT prices obviously. So it should be quite interesting to see the development of the pit mining plan in a positive way as APT prices continuing to harden in line with the forecasts.

I don't have an imaginary line that moves for the other two sources delivered to the ROM pad - the tailings and the pit as they're all going to be economic. That said we know the grades graduate in the pit and improve at depth.

Interesting times ahead given Wolf administration issue could take 5% out of the western APT supply market and the next phase of China's environmental policy comes into force before Christmas could see supplies tightening from the eastern markets too.

GLA

NaPom thanks for the link. Very interesting!

Ha ha!

I am Spartacus! Oh sorry wrong BB.

I am Fuad! Ha ha

sbrown36 you have my total respect for your post today!

GLA sincere investors.

Good luck to you too CF and to you Trombone.

As you say CF I think the "dies been cast" and we're just waiting for it to cool before the market sees it.

Not too long to wait now.

Excellent posts this morning Strongman! Really good.

I've been in Prem for a number of years and needless to say I'm under water. That said I feel I've tried to understand the fundamentals the legalities as best I can and one things for sure - I take full responsibility for where I am in this.
Perhaps that's what others should try much harder to do.

Anyway I think it should be a pivotal week nest week. The governments extended deadline to formalise the new equity agreement ended yesterday and after the MOM's press release last week we should be seeing an RNS Monday perhaps Tuesday at the latest on my opinion.

Please keep your posts coming Strongman.

GLA

kenny that's just brilliant news. thank you!!!

kenny that's just brill. thank you!!!