Member Info for tedoby

You're welcome Wolframite.

The $4m+ Prem Loan to the newly formed ("MauCo") represents the amount Prem Afr have spent on the Zulu project as as 26th June when Heads of Terms were entered into.That expenditure now sits as a loan from Prem to MauCo on MauCo's books

The parties have agreed that Cadence's part of Prems Loan (say $1.34 + interest) will be paid to Prem against the loan out of their stage payments. So out of the first one on $1.5m roughly $375m gets paid to Prem and so on. This could represent around $1.3m income to Prem from MauCo over the year or whatever the stage payments are spread over.

Thanks for that Microtan. In my eyes it's questionable which one of the two "sign-off's" will come first. The Governments or Auditors?

While we wait I also think its interesting to note that Zulu Lithium Mauritius Limited ("MauCo")
start to repay its $4m loan from Prem "Premier Loan" together with any interest on receipt of the Investments Amounts from Cadence Minerals Limited in accordance with the schedule on a pro-rata basis.

MauCo will obviously need the investments from Cadence not only to pay for the work to get to DFS but also the loan. For me this explains the difference between cost estimate suggested for the DFS of just over $2m to the latest investment heeded of just over $5m. The 5m isn't just the cost of the DFS it's the sum needed to pay back Prems loan too.

The repayments should make quite a nice contribution to Prems income and more than likely negates to need for near term dilution other than any that may be be required for growth which no savvy investor should object to.

Nathan I know you'd prefer up then down. But then we all would!

GLA

ProfessorG I think you and I are playng on the same field. RHA should in theory be closer to your reasoning but we'll have to see how the ownership split works out I think. Your $400/mtu price for APT I agree with.

Whatever the fundamentals turn out to be - I believe RHA will be a very attractive part of Prems portfolio within a year as you say. .

GL

Tungsten APT European price now US$350-354/mtu and rising.

It would be interesting to re-calculate RHA's break-even at these prices once the fundamentals are known. My first guess is 1900mtu's/month and with a target of10,000mtu's/month it's not difficult to reason how potentially valuable an asset RHA could be.It could quite easily contribute between 1p and 2p towards Prems SP even if Prem kept it's original ownership %

At Prem's target production rate and todays prices annual revenue would be over $42m. Net profit or "earnings" from that I suggest would be at least $25m which in turn would reflect a Market Cap of around $250m usinf a P/E ratio of 10 . Prems benefit MC on a 50% ownership would therefore be $125m.

Even if Prem had 10bn shares in issue and 50% ownership that works out to be a 1p share price at today's $/£ exchange rates.

So all in all something to look forward to and a valuable part of Prem,s portfolio I think.

News not far away now.

GLA

The decision whether to go the concentrate route or the far more lucrative carbonate route long term on Zulu seems to a no- brainer in my view. Initially we'll see Zulu go to market by producing concentrate simply because it's the quickest. But from there we'll see carbonate being produced as quickly as possible. Exactly as Prospects development plan I believe

From the PEA and before that the Maiden Resource Statement ( SAMREC compliant and independently validated) it's not difficult to foresee Zulu producing between 50kt's and 75kt's of LCE from a ROM of around 2mt's of ore a year once running the carbonate production.

The conversion factor from Li2O to LCE is 2.473 and assuming the Tantalum credits are in balance with the recovery adjustments for Lithium Zulu could enjoy an annual revenue of between $1,25bn and $1.9bn. ( 50,000t's @ $25k/t and 75,000t's @ $25k/t ). The current market price for LCE being around $25,000 / tonne and whilst I've used that figure that's forecast to double by the time the mine becomes operational

Excluding tax and royalties etc. and from low Cash Costs and AISC's annual AIC's should be no more than $250m which if about right would give the mine an "earnings" figure of between $1bn and $1.65bn.

Then assuming a 50/50 j.v and a currency conversion of $1.3 to £1 we're looking a notional "earnings" to Prem from Zulu of between £385m and £635m.

It follows that using the "earnings metric" valuation method and assuming a P/E ratio of 10 Prem could therefore enjoy a Market Cap contribution of between £3.85bn to £635bn.

I imagine finance will be a cocktail of equity and debt and involve a partners support and perhaps off-takers loans. So lets say there's 10bn shares in issue that would give Prem a SP contribution from Zulu of between 38.5p and 63.5p before tax, royalties and off-takers commissions and possibly as much as 25p to 40p net. But as I say that's based upon a LCE market price of $25,000/tonne but the forecast is for that to double in three years. If the forecast is right we could be looking at a SP of nearer £1. That's how valuable and lucrative Zulu could be and a measure of the opportunity here.

Finally if Prem get to a DFS on Zulu within a year and approvals aren't a problem then we could see Zulu getting to Commercial Production and achieving around these numbers within the next three years.

GLA

Bye Wingnut1

GL to you too.

cherryburn - Wolfram Bergbau und Hutten and the Global Tungsten & Powders to name but two.

There's not a chance of a placing in the .12p's in my view. Good luck with it if you intend to wait.

Tungsten APT European US$350-354/mtu today and climbing. As a result off-takers are starting to offer finance to Tungsten miners now.

GLA

Tungsten APT European US$350-354/mtu today and rising!

I agree Wolf! Giving personal details to complete strangers is not a good idea. Banding together and acting in some form of "concert" without a clear agenda may be frowned upon and could in itself be risky too. Not long to wait for news now. GLA genuine holders.

Tungsten APT European price up again today at US$350-354/mtu

Tungsten APT European US$342-347/mtu now vs US$340-345/mtu last week and continues to rise.

The price of APT has increased by over 10% since the appraisal was issued in September. Breakeven therefore should now be from processing more like 4000 tonnes/month of ore a from the underground mine. Taking recoveries into account that's the equivalent of approximately 1500 MTU's APT/month. Or put another way roughly $500/month and $6m/ year. Prem has a production target of 10,000MTU's/month for RHA and when met that would give a revenue of over $40m/year at current APT prices. From that it's not difficult to foresee RHA having a notional Market Cap of $200m from using an earnings metric as the basis for the calculation. So even if Prem entered into a 50/50 jv Prem should enjoy a contribution from RHA of at least 1p towards its SP. GLA

NaPoM you're absolutely right. This is what GR said about the main zone:- "These initial results again confirm continuity in the mineralisation of the Main Zone and support our internal exploration target of 60 to 80 million tonnes for this zone. I look forward to updating results in the near future." But then we were informed there was another zone in the south- east that was potentially bigger. This is what we were told about that one:- "Highlights: � New zone in south-east of license area has potential to exceed Main Zone tonnage." I've tried to find out what the total tonnage might be but the company are keeping stum. The drilling strategy changed slightly towards the end of the last season purposely to delineate the extent of the resource so I believe GR knows but isn't saying. GLA

The decision whether to go the concentrate route or the far more lucrative carbonate route long term on Zulu seems to a no- brainer in my view. Initially I believe we'll see Zulu get the Lithium to market by producing concentrate simply because it's the quickest. But from there we'll see carbonate being produced as quickly as possible with the extra Capex needed coming in part from revenue. Exactly as Prospect intend to I believe From the PEA and before that the Maiden Resource Statement ( SAMREC compliant and independently validated) it's not difficult to foresee Zulu producing between 50kt's and 75kt's of LCE from a ROM of around 2mt's of ore a year once running the carbonate production. The conversion factor from Li2O to LCE is 2.473 and assuming the Tantalum credits are in balance with the recovery adjustments for Lithium Zulu could enjoy an annual revenue of between $1,25bn and $1.9bn. ( 50,000t's @ $25k/t and 75,000t's @ $25k/t ). The current market price for LCE being around $25,000 / tonne. Excluding tax and royalties etc. and from low Cash Costs and AISC's annual AIC's should be no more than $250m which if about right would give the mine an "earnings" figure of between $1bn and $1.65bn. Then assuming a 50/50 j.v and a currency conversion of $1.3 to �1 we're looking a notional "earnings" to Prem from Zulu of between �385m and �635m. It follows that using the "earnings metric" valuation method and assuming a P/E ratio of 10 Prem could therefore enjoy a Market Cap contribution of between �3.85bn to �6.35bn. I imagine finance will be a cocktail of equity and debt and involve a partners support and perhaps off-takers loans. So lets say there's 10bn shares in issue that would give Prem a SP contribution from Zulu of between 38.5p and 63.5p before tax, royalties and off-takers commissions and possibly as much as 25p to 40p afterwards. Finally if Prem get to a DFS on Zulu within a year and approvals aren't a problem then we could see Zulu getting to Commercial Production and achieving around these numbers within the next three years. GLA

NaPoM thanks for doing all the research and sharing. It's very interesting and much appreciated.

I believe we'll see news on Zulu very soon. By that I mean any time now.The "Terms Sheets" will be in the closing stages of negotiation now with proceedings having been disrupted by the changes to the indigenisation law included the new Finance Act and published less than four weeks ago in the Government Gazette Extraordinary. I imagine negotiations couldn't have been concluded before those changes were enshrined in law. The decision whether to go the concentrate route or the far more lucrative carbonate route on Zulu seems to a no- brainer in my view. From the PEA and before that the Maiden Resource Statement (SAMREC compliant and independently validated) it's not difficult to foresee Zulu producing between 50kt's and 75kt's of LCE from a ROM of around 2mt's of ore a year. Noteworthy in the MRS is that there's over 7mt's categorised as containing around 1.5% Li2O. That's a significant portion of the scoped ore body of extremely high grade by any standards and shouldn't go un-noticed. The conversion factor from Li2O to LCE we know is 2.473 and assuming the Tantalum credits are in balance with the recovery adjustments for Lithium the mine could enjoy an annual revenue of between $1,25bn and $1.9bn from producing the carbonate. (50,000t's @ $25k/t and 75,000t's @ $25k/t ). The current market price for LCE being around $25k/ tonne. Excluding tax and royalties etc. and from low Cash Costs and AISC's annual AIC's should be no more than $250m which if about right would give the mine an "earnings" figure of between $1bn and $1.65bn. Then assuming a 50/50 jv and a currency conversion of $1.3 to �1 we're looking a notional "earnings" to Prem from Zulu of between �385m and �635m p.a. It follows that using the "earnings metric" valuation method and assuming a P/E ratio of 10 Prem could therefore enjoy a Market Cap contribution of between �3.85bn to �6.35bn.from the mine.. I imagine finance will be a cocktail of equity and debt to involve a partners support and perhaps off-takers loans. So lets say there's 10bn shares in issue that would give Prem a SP contribution from Zulu of between 38.5p and 63.5p before tax, royalties and off-takers commissions and possibly as much as 25p to 40p afterwards. Finally if Prem get to a DFS on Zulu within a year and obtaining approvals is relatively straightforward then I believe we could see Zulu getting to Commercial Production and achieving around these numbers within the next three years all things being equal. GLA

The decision whether to go the concentrate route or the far more lucrative carbonate route on Zulu is virtually a no- brainer in my view. From the PEA and before that the Maiden Resource Statement ( independently validated and SAMREC compliant) it's not difficult to imagine Zulu producing between 50kt's and 75kt's of LCE from a ROM of around 2mt's p.a.given grades are between 1% and 1.5% Li2O. The conversion factor from Li2O to LCE is 2.473 and assuming the Tantalum credits are in balance with and will pay for the recovery adjustments Zulu could enjoy an annual revenue of between $1,25bn and $1.9bn. ( 50,000t's @ $25k/t and 75,000t's @ $25k/t ). The current market price for LCE being around $25,000 / tonne. Excluding tax and royalties etc. and from low Cash Costs and AISC's - AIC's should be no more than $250m p.a. which if about right would give a Zulu j.v. an "earnings" figure of between $1.00bn and $1.65bn for the mine. Assuming then a 50/50 j.v and a conversion of $1.30 to �1.00 we're therefore looking a a notional "earnings" to Prem of �385m and �635m. Using the "earnings metric" valuation method and assuming a P/E ratio of 10 Prem could therefore enjoy a Market Cap contribution from Zulu of between �3.85bn and �6.35bn. Finally finance will likely be a cocktail of equity and debt and involve a partners off-takers support. But for this purpose lets say there's 10bn shares in issue that would give Prem a SP contribution from Zulu of 38.5p to 63.5p before taxes, royalties and off-takers commissions are paid and possibly as much as 25p to 40p or thereabouts afterwards. All being equal and when Zulu is up and running in possibly 3 years time. GLA

Wondergoals I couldn't agree more!