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Looks like a few end of tax year "Bed 'N' ISA's" going through today :-) Well done all.. over the years I have managed to get all of my CNR shares into my ISA and a few in my SIPP.. hoping for some tax free rewards / income in the next couple of years..
regards,
T123
RR - MC has already received quotes from Metso for the rest of the equipment required.. (last Tuesday), so that will all need to be agreed/signed off etc. His comment last week was that from the point of when all the equipment is in the country, it would then take roughly 12 months for construction and first gold pour. I think the next 4-6 weeks of getting the initial equipment into the country will be telling as it will prove the process - will there be any customs / import delays, taxes to be paid etc so we will understand more about how long it will take for the rest of the equipment to arrive on site. Yesterday was a good example of how CNR is viewed in the country though, as Nicaragua will want to do everything they can to promote the foreign investment etc.. I think any delays at the port/customs would be swiftly steamrollered in order to progress this..
My guess is 6 months till it all arrives, then construction financing announced before general elections in November, and from that point, its 12 months till 1st gold pour.. end of Q4 2022, Q1 2023 till the mine starts producing.. Lycopodium have a good record of delivering ahead of time and on budget as well (just putting that out there ;).. Of course, a toll mill deal (or an offer) might come through before then.. esp if gold price responds to inflation fears etc..
regards,
T123
Unlike a few other forced sellers in Condors history, RB is not "selling at any price" - it looks like a measured move by him, at a limit sell price.. by my reckoning last week, he still has around 3.5M-4M shares to sell at 50p each.. but yes, at the volumes we have been getting since the mill announcement last monday, its going to take a little while to clear the overhang.. but then again, its a new ISA year soon, and hopefully there will be a few buyers here, so hopefully it should clear out the share sell..
As I say, I really think CNR under 50p is a bargain right now.. so much potential for growth / near term cashflow etc.. just my opinion and dyor as usual! As a caution, the only thing we might see is a market crash, where the baby gets chucked out with the bath water and gold price is sold down as a hedge.. if that happens and CNR tanks temporarily down to the 20-30p level again.. it would be time to really buy more here.. as gold is likely to rebound pretty violently up to 2500 levels and above.. and CNR has a moonshot chance at that point, being relatively close to production (i.e in 12 months time) , 5 Million ounce district resources if Cacao drilling comes in good etc..
regards,
T123
Seemed like a good session, well received and an excellent "plug" for Condor Gold and Mark Child.. Hopefully nicaragua will get more recognition as a good place for miners to do business! any idea how many people attended?
regards
T123
Seingred "Tester I think you are barking up the wrong tree with your calibre conspiracy theories " - In reply, lets run some numbers here (or do you think that the Calibre management team havent already been doing that, amateurs that they are?)
Calibre have 1.5MTPA spare capacity at La Libertad. Condor need about 0.3MTPA to get a 40koz toll deal. But if Calibre actually wants to expand their gold production in Nicaragua, either by buying La India for themselves or by buying it for Rio Tinto as a partner... the LAST THING they would want to do is to increase the cost of buying CNR as a company from probably £65M (50p SP) to £130M (100p SP).. They will "only" make about £10-12M a year from the profit sharing toll milling agreement.. but in the process they will make CNR £60-70M more expensive to buy as a producer with no debt... The revenue they would receive from toll milling is MUCH less than what it would then cost them extra to subsequently buy CNR.. so a toll mill deal would effectively be shooting themselves in the foot - and the guys at Calibre are not stupid..
So for me, in order to get to a toll deal, we need Calibre to finally abandon the daft idea that they can somehow buy CNR/La India on the cheap.. i.e for 50p a share etc (by making a hostile cheap bid, which will fail as JM/MC/All of us will reject it) .. I believe that Condor getting the financing for the plant sorted and starting construction (i.e sinking the capital) will force them to abandon this.. or if CNR look like they will agree a deal with Mako mining instead.. and rather than miss out altogether, Calibre will want to earn £10-12M a year extra instead of £0. Personally, I wish they would just go ahead and attempt a cheap hostile bid, if just to wake the world up to the fact that CNR have 1.2Moz of high grade gold ready and permitted for extraction..
Im sorry but I dont think thats a crazy conspiracy theory at all.. im almost certain its true! Or do you think that business people are always nice to each other as they play golf?
regards,
T123
Plantel Los Angeles is Randy Martins (aka NMC) outfit - probably explains why he sold off some CNR shares last year if he needed it to fund this new venture.. I guess if its just for artisanal ore, then a commercial operation from CNR wouldnt be too welcome. Plus I think capacity at those smaller plants is only 100-150tpd, but as i mentioned over the weekend, CNR needs 1000tpd for 40koz pa contract - anything less than that would not really be worth its while!
regards
T123
A 40koz pa toll milling operation would probably require about 1000tpd trucked - I.e roughly 0.3Mtpa of the 1.5Mtpa spare capacity at La Libertad.
Again, why wouldn’t Calibre just agree to that unless they were acting in a Machiavellian fashion! ;-) A mill that size running with that much surplus capacity, it’s not really good business sense for a gold miner is it, with gold prices currently this high..
Regards,
T123
Softrock - good point - MC said on Tuesday night, that when all the bits of the plant were in Nicaragua, then it would take 12 months from that point to construct the mine.. so yes exactly, more like 18 months till 1st gold pour, unless toll mill happens first..
regards
T123
Sorry, just one more thing on this -we basically know that the mill feed for any Toll deal is likely to come from the La India and Mestiza high grade starter pits. The infill drilling ("Last drilling before extraction" MC has said) and assays on those are still underway as we know, along with the resultant mine schedules that will need to be updated... So in a sense, it might actually still be a bit early for a toll deal to go ahead quite yet. Previously though, MC has said that any toll agreement would take 3 months lead time to put in place via contract trucking, explosives, roads and other infra etc.. (Capex of $2M).. so to be fair, perhaps until MC thinks he is only 100 days away from getting all the results back on the drilling/schedules, and can definitely commit to providing Calibre with the ore, he may not want to commit to an agreement either. .. could incur contract penalties if he signs up and then they aren't ready to deliver the mill feed yet..
regards
T123
I was trying to quantify what a 40koz pa toll mill deal with 50/50 profit sharing would be worth to Condor - I think it would generate around $15M cashflow a year, with a minimal $2M CAPEX upfront and no debt required. That would give EPS (130M shares) of 12c, 8.5p.. at a conservative p/e value of 7, thats about 60p per share. Just for the toll mill deal alone.. (Plus the residual value of their resources etc - I would think it should take the SP up to the 90p-100p mark).
Now for me, heres the rub.. Calibre know all of this as well - they know that signing a toll deal with CNR would increase their SP/MCap. And if you actually wanted to buy La India/CNR cheap, would you really want to be the cause of that SP increase? For me, thats been the real cause of the delay in doing the deal so far...
My hope is that the recent change at the top of Calibre, coupled with the £4M investment from JM, $3M First Majestic Silver, purchase of the new SAG Mill now etc, means that they will finally capitulate on holding out on the pipe dream of buying CNR cheap as a distressed asset.. and finally accept that they have shot themselves in the foot for 18 months, as they could have had an extra 20koz of production/cashflow per year.. If it was good enough for B2Gold, should have been good enough for them..
regards
T123
Just one more thing - I sincerely hope that CNR offer locals $1-2 an hour more than Calibre are paying at La Libertad and El Limon and we poach half of their already well trained, experienced workforce, leaving them totally in the lurch.. Will serve them right for trying to screw CNR over on the toll mill deal for 2 years!! lol
regards,
T123
LastChance - appreciate everyones opinions here, but for me, I have to go with what the CEO has said publicly - i.e Land is not an issue and that there is no shortage of offers from local banks to finance this project, along with offers of gold loans..
For me, I think MC is playing a poker game.. he wants a signed toll mill deal to raise the SP before he commits to construction financing.. (can raise equity at higher price) so he is waiting till the last minute for financing to see if that goes ahead.. and again, they dont need the remaining 5% of Land to progress the project right now as they already own all the land the plant will be built on.. So why pay out that money now if you dont need to? Plus the 5% land is where the co-op of miners work, so they would be out of a job / livelihood to feed their family if CNR buys it too early.. much better to wait until its really needed, i.e probably up to 18 months until mining starts.. plus, when plant construction does start, the local co-op members may well decide its safer/better to be one of the 1000 locals who get a job constructing the plant, rather than keep mining.. win/win for the company and the locals..
Just my take on it of course, and happy to listen to alternative theories..
regards
T123
Bartlet - there are always risks in any investment. I think one of the only risks here that none of us can control / quantify is the country the company operates in (Nicaragua). But Calibre Mining (who bought B2Gold assets), Mako Mining, Hemco, Golden Reign, all successfully operate gold mines in the country. Gold is one of the biggest exports in Nicaragua.
But Condor certainly ticks a lot of other boxes, high grade, low cost etc. Buying shares at under 50p here is a bargain - but its just my own opinion, DYOR etc.. In terms of potential news flow that could cause a significant rerate...
Signing a toll milling deal with a nearby mining company for 40koz per year production with virtually no CAPEX required.
Excellent drill results from 5000-10000m infill and exploration drilling programs that are currently in progress.
Exploration drilling could easily show that the company can add 1Moz of high grade gold to its current 2.4Moz resource. This would show potential for a 5Moz district which is approaching a Tier 1 world class deposit level..
$ Gold price increases from recent $1680 low should continue to rise this year with US Stimulus, inflation fears etc.
When you compare the current Mcap of Condor to other exploration companies with similar resources, either they are massively overpriced or CNR is massively underpriced!!
regards,
T123
I agree Sam! And they have built two viewing platforms over the site for exactly that reason apparently, but yes I think we are long overdue a video of the actual site preparation itself happening, im sure MC promised that at one point last year.. The first bits of the new mill should arrive in Nicaragua in 4-6 weeks apparently, subject to shipping times..
We should be due more drill results from La India next week (pretty sure the drill samples themselves are batched up and sent to the BV lab every two weeks, so hopefully news received from that).. assuming CNR intends to report on every batch of assay results that are received..
regards
T123
The guy is about 70 now isnt he? Seems like a good age to retire to me! :-) Im sure Ross probably had 20-30 different investments in mining juniors with potential like CNR at one point - 2-3 million is nothing, the guy is worth billions, so its a drop in the ocean to him - i think he paid around 40p for his stake initially, so selling at 50p is 20% profit.. im only guessing of course, but the other galantas news seemed to make sense.. perhaps he is just leaving this one to the other billionaire investor in the room for a change, lol.. if there was a serious underlying issue here, i dont think JM and others would have just put in £4M and First Majestic and Keith N would not have accepted $3M in shares from CNR for their mill payment..
It is what it is for now I guess..
regards,
T123
RR - In the meantime, there are now only 10 working days left before the start of the new tax year in which MC could release any price sensitive news.. fingers crossed nothing substantial arrives before then - some good drilling results would be fine though ;-)
Speaking of which - Cacao drilling of 5000m - 20% now complete? BV lab in Managua took 3 months to assay the initial La India infill drilling results.. so could be at least another 2 months till we start to get the results of that drilling.
Worth remembering that La India Open Pit is 1.2km long by 600m deep, and they have 2.4Moz from that one vein set alone.. But Cacao actually seems to have a 3-4km strike length.. so how much gold could it contain? 1Moz at least.. but if its bigger, i.e the geologist thinks it looks just like La India, then it could actually be another 2-3Moz.. if so, well then thats a rather big deal.. so all eyes on the Cacao results!
regards,
T123
WG - if it is indeed RB who is selling recently at 50p (we have seen that he seems to be doing the same in other minor PM holdings that he has, possibly due to his impending retirement from the industry as a whole) then this is the overhang we may currently have at this level:
5,579,512 (4.61%) 29th January
4,786,656 (3.7%) 1st March
4.??????M 18th March??
So it seems as if he sold around 800,000 shares in February. We saw a 200k sell go through on Monday at 50p after SAG announcement.. So he probably now has around 4M shares still to sell at what seems to be a limit price of 50p.. all the large sell trades have been at 50p so far I think.. which is probably why we have been range bound between 45-55p as well recently, now I come to think about it..
Might I suggest that this could provide a lot of people with a very nice top up / average down opportunity from April 6th onwards in their tax free wrappers!.. at least until the share overhang clears and CNR is finally, finally, finally.. "off to the races"
Its all conjecture of course as we dont know for certain it is Ross, but it does seem to fit the facts of what we know from TR1's etc ... Thats unless the recent FM involvement has suddenly made him think again and re-evaluate his position here (we can but hope!)..
regards,
T123