Member Info for thewakokid

This movie reminds me a bit of KOD's SP.

Just drifting around, occasionally punishing the bad boys, the foolish or the greedy but, on the whole, wanting to do the right thing for the townsfolk.

TWK - riding across the desert to Lago to catch up with Sherriff Shaw.

Read an interesting article in the Sunday Times about the need for several lithium battery production factories in the UK within next 3 to 5 years, that can supply the UK electric car industry so as not to fall foul of the EU "country of origin" test.

Such a move will dilute the control/influence of the Chinese et al in determining the price of lithium batteries, and therefore lithium itself. Competition will put downward pressure on prices but it will also remove the Chinese et al's ability to depress the price so as to make other lithium producer country's lithium mines less profitable/unviable.

Also saw a programme that mentioned that the first cars in the US were electric. When "cheap gas" came along, it put paid to electric cars.

Funny old World.

TWK - in Dodge City with Doc Holliday to celebrate the New Year

Appreciate the insight Daz.

Merry Christmas!

TWK - Putting together a posse to search for Brussel Sprouts and Parsnips

Interesting article in yesterday's Sunday Times about a proposed lithium mining operation in Cornwall which, when up and running, is estimated to generate £40 million/year in sales.

The man behind the project is very experienced when it comes to mining , with a "big mining corporate" background, and seems to know his stuff. He has raised a fair few million £ already and the last raise was oversubscribed. Still a private company but you never know, maybe a listing on AIM in the future.

Health warning - the company has not yet approached any potential buyers of the lithium.

It occurs to me, and I may be horribly wrong of course, that for the next 10 years or so, it is the lithium that comes from big mines, in politically stable counties, at competitive prices that will thrive. Lithium mining may follow a similar evolution as oil mining did, when eventually, after many years, it became viable to drill for oil in places like the Falklands; despite the political risks of Argentina's claim to the islands.

All IMHO, DYOR and MYOD.

TWK - riding home for Christmas

Corporate speak translated as:

"Its stopped p*****g down with rain and we are gonna have a go at finding some gold in them there hills"

Why don't these good folk speak in plain English?

F100,

Tried it once, couldn't speak for two days. Wanted the wife to drink it every day after that.

TWK - still in the foothills above Tucson

I'm not out here either

TWK - hiding in the foothills above Tucson

Thanks for the insight Daz, always much appreciated; not least as I am still learning these things.

TWK - sitting in The Long Branch Saloon and waiting, just waiting

The current spread is as low as I can recall since starting to research KOD several months back.

I was told by people that know these things much better than I do, that the spread indicates the liquidity in a share. High spread = low liquidity. Low spread = high liquidity (all relatively speaking).

Could this be an indicator of news, of some sort (even if it is only to say that there is no news), coming out soon?

Thoughts welcomed and appreciated.

DYOR and RYOC please.

TWK - finally in Dodge City after a long ride

An interesting move for KOD. It may mean that there will be plenty of news to share in the coming weeks and months. Why else would KOD have taken to Twitter - unless of course they just want to follow Grumpy Trumpy?

All IMHO

TWK - holed up just outside Dodge City waiting for a sand storm to pass by

J1,

Funding for the mine will present a challenge for KOD, and by dint its shareholders, whichever way you look at it.

If we assume that Sino either lends KOD the wonga or underwrites bank finance, the senior debt will always get paid back before shareholders see any return, either by way of dividends or if the company is sold.

A $120 million loan (NPV excluding interest costs) versus $200 million post tax profit (NPV), $165 million a year revenue over the LOM and a current EV of circa $6.15 million would be very high risk for a lender. And so anyone willing to lend that much wonga will want a very big return to reflect the risk. If they don't want a big return, they would need to see a psychiatrist.

Either way, the shareholders will end up paying. The question is whether a dilution will be less costly to shareholders long term than a senior debt lender controlling the show and getting their wonga out first.

All IMHO, DYOR and RYOC please

TWK - flush from taking $20 off Doc Holliday with the two pairs of Aces.

Lurker Lot,

A very good point, which I had completely missed. Debt would certainly be cheaper than equity dilution for existing shareholders, subject to what the interest rate is of course.

Your strategy of selling on good news (the ML seems to be the next most obvious +ve piece of news) long before the mine construction starts seems the lower risk one IMHO.

TWK - with two pairs and facing down Doc Holliday. Mind you, it is two pairs of Aces.

Afternoon Daz,

Thanks for spotting that. Should read $0.0048, $0.0097 and £0.0126.

Mind you, with so many 0s (figure Os as opposed to garden Os - thanks the Two Ronnies), does it matter much?

TWK - saddle sore after that ride from Tombstone

When KOD gets the ML (ever the optimist!) and then proceeds to production, it will need to raise around $120 million to build the mine and processing plant - assuming that the estimate ain't too far out.

Assuming that this is raised by issuing shares (hard to see any banks lending KOD the wonga), lets say for the sake of argument at $0.048/share (at $1.30/£1.00), that would require 19,200,000,000 shares to be issued. Currently there are "only" 11,549,000,000 shares in circulation.

If that assessment is right (it may be horribly wrong of course), it would be not so much a dilution (think a glass of squash with a bit more water in it), more like a monsoon (think tsunami volumes of water).

And with that many shares in circulation (ignoring a consolidation for the moment), the NPV of the $300 million for the project would equate to $0.097 (£0.126) per share.

So, I could, and assuming that I am right (big, big assumption), look to the possibility of doubling my money.

And looked at another way, would I invest $120 million in a mining project in Mali (if I had it!!) to hopefully get a return of $300 million (NPV at 7%), with all the attendant risks? It would be less risky to invest $120 million in M&G Group where the yield is steadily averaging around 9.9% per annum.

DYOR and RYOC please.

TWK - wondering if a hand of poker with Doc Holliday might be a better bet than investing in KOD

Can't remember when the spread was this tight. "If the spread tightens a lot, it is like a spring being compressed under the SP" a m8 of mine once told me.

DYOR and RYOC please.

TWK - playing snap with Doc Holliday.

Ziq,

I think that you could well be right. Looked at another way, it is a good hedge against the downside risks.

If it is a hedge move, then it could mean:

(1) They reckon that the SP won't go below the 0.063 level or, if it does, it won't be for long and the SP will come back up;
(2) They think that there is a relatively near term potential uptick in the pipeline for them to sell in to e.g. announcement of the ML being signed

These boys will have a good insight into KOD's current financial status and any future potential. Nothing unsavoury in that, far from it, they simply need to understand the risks before lending their hard earned wonga to KOD.

So, for me, and IMHO, I see this RNS as positive overall - but I may be badly wrong of course.

DYOR and RYOC please.

TWK - listening to Doc Holliday recounting the Gunfight at the OK Corral and thinking ................... "Gunfight of the Day" , hosted by Both Barrels Lineker, would have made a great Saturday night TV programme.

"The documents are pending signing by the new Minister which will then allow the Company to receive notification of requirement to pay for the Mining Licence"

I wonder how much KOD will have to pay for the ML? If the transition government is in need of some ready cash, the ML may not come cheap me thinks and so $750K might come in useful.

All IMHO and I may being a tad cynical/pessimistic?

TWK - with Doc Holliday, leaving Tombstone and heading back to Big Nose Kate's place

LB,

The amount of red ink is, on the face of it, a natural cause for concern. However, to put matters in perspective, shares sold so far today are a small fraction of the total number of shares in issue. And with there not being any obvious reason for buying at this particular moment in time (fundamentals being equal), perhaps some PIs are taking their money out of KOD table to put into another AIM stock where there may be news pending.

All IMHO and I may be badly wrong, so please DYOR.

TWK - riding with Doc Holliday

Thanks for that Camkite, really helpful - and encouraging.

Your assessment on the demand for gold, and the reasons for it, is really insightful and not something that I had fully appreciated - so more thanks for that.

I am still researching and so apologies for stating what you will already know.

I have just read the last annual report and accounts. Seems the company is solid in terms of being a going concern cash wise. The report says that the company will look to list on another market in due course to increase liquidity.

And there was a mention that I read somewhere of Rio Tinto having bought a healthy chunk of adjoining acreage.

All in all it looks like you have unearthed (pun intended!) a great investment opportunity.

TWK - heading out West where the gold is in them there hills

PS I don't understand Bitcoin I'm afraid but a friend of mine is full on into it - and he used to be a trader with RBS - made a small fortune at that game, burnt out by 25 years old and is now an eco warrior but with a commercial angle.

Camkite,

Happy to keep a low profile.

Read a research note that had a TP of 5.54p.

TWK - on silent running