Member Info for TigerByTheTail

A little mining history here may help newcomers here...
Kabwe (formerly Broken Hill) in Zambia was once the biggest lead and zinc mine in the world. It had a core of extremely high grade lead and zinc suphide ores, as well as a surrounding halo of willemite (a zinc silcate). In those days it was known how to process the sulphides, but not the willemite. Thus, the willemite went straight to the tailings dumps of the mine. Kabwe was mined out of sulphides in the 1990s and it closed down (and it is now flooded).
Kabwe's huge tailing dumps are now owned by Jubilee. Since it is now known how to extract zinc from willemite, the tailings will be reprocessed by Jubilee at their Sable plant, producing a mix of vanadium pentoxide, zinc metal and lead concentrate. This is a very nice business for Jubilee and it has nothing to do with Galileo!
However, Galileo now own the "large mining licence" at Kabwe, into which falls a nearby area called Kashi'tu. This shallow ore body was drilled in the 1970s, and large amounts of high grade willemite (also containing significant amounts of vanadium) were found. Nothing was done with the ore then as essentially BHP were looking for sulphides (and not willemite), and they didn't find what they were looking for. Now, of course, given that metal processing technology has moved on in the last 40 years, Kashi'tu could be very valuable indeed.
The plan here is clear enough - mine out the high grade but limited pit at Star Zinc over the next 6-7 years, and generate substantial amounts for free cash from it, and then use that free cash to develop and exploit the potentially much larger (but earlier stage) deposit at Kashi'tu.
I hope this helps!

Hi Sotolo!
I agree that HOC's results were solid. But I had the choice this morning of adding to my Centamin holding or my Hochschild holding, and I saw more upside here (as well as a better dividend).
I'm still very confident about gold and silver prices in the short / medium term. The amount of negative yielding debt globally is still going up and up, and gold is sanity in a financial world gone crazy.

https://investorintel.com/sectors/technology-metals/technology-metals-intel/the-rare-earths-state-of-the-market-july-2019/
Also, it's been a long time since we've heard anything meaningful about Songwe Hill from Mkango. I don't know if that's a good thing or bad thing!

Sorry about the previous post!
I think Colin Bird may have meant 25m quid per year EARNINGS for Jubilee from Kabwe / Sable.
This is a bit lower than my ballpark estimate, but it may take into account the recent drop in vanadium and zinc prices, and some extra costs which I didn't include.
Actual revenue should be a lot higher. Just multiply the given tonnages of vanadium, zinc and lead by their market prices (allowing for a discount for the lead being only lead concentrate), and you'll get a much higher figure. And that is without considering extra zinc feed from Galileo's Star Zinc operation or revenues from the copper / cobalt line.
Anyway, I'm getting round to buying, as I see real value at this level. But I'll wait a couple more days to see if the share price will drop a bit more first.

I think 25m

IMO, pretty much all gold miners are responding "soggily" to the rise in gold and silver prices today.
I don't know why, but it's not limited to Fresnillo. Perhaps tomorrow the miners will react to today's movements; it goes like that sometimes.

I agree that it's the offtake news that should drive a big rerate here (and I do mean big!).
I also agree that the small scale mining licence shouldn't be too much of a problem. Star Zinc is essentially a quarrying operation, reopening an old open pit and using no chemicals. Colin Bird also has excellent contacts in Zambia, where his previous biggest business successes has been.
However, I do wonder if we won't get the offtake news until after the whole BMR saga is done and dusted. Their GM/AGM is on the 23rd August. It may be that JLP are delaying any news about Kabwe / Sable (both their possible purchase of the Kabwe royalty from BMR and the Galileo Star Zinc offtake) until then.
We've also had a round number seller keeping the price down until the last couple of days, so there should be a TR-1 to come. IMO, this will turn out to be BMR disposing of their 5% shareholding here. But we will see.

https://www.proactiveinvestors.co.uk/companies/news/900620/we-have-a-niche-a-brand-and-credibility-says-colin-bird-as-jubilee-metals-cashflow-opportunities-multiply-900620.html

Back from hols and good to see this share beginning to rerate.
At a 2m quid market cap Galileo was simply ridiculously overlooked and mispriced. Based on GLR's current situation (e.g. pre-offtake confirmation) I think a 8-10m quid mcap would be about right, so we still have a long long way to go.

If that story is true, that's really bad for SVS retail clients (and possibly for Vast as well).
HMRC (as always) is first in line to be paid when an administration occurs. The administrators must take their fee as well. So how much will be left for the SVS retail investors?

Hi Tradedesk and BMR!
Also, note that in the June RNS completing the Star Zinc deal the BMR lock-in wasn't mentioned at all. It seems to me that either permission has been granted to sell or the lock in clause was dropped at some point.
Hopefully we'll get an RNS soon confirming that BMR are out.

Yes, big jumps in revenue and earnings, even with a very flat chrome price in Q2.
And lots of near term revenue and earnings increases still to come from Windsor PGMs, DCM fine chrome, and (most importantly) Kabwe/Sable.
p.s. I wonder why they renamed Platcro as Windsor?

Yes, that's domino #2 fallen for Galileo with Jubilee's completion of the Sable Refinery acquisition.
Domino #3 is the Star Zinc offtake agreement, which I expect will be signed within a week or so.
Having thought about it, IMO BMR have been selling down their 5% shareholding via a broker. They can't have many shares left -- it was 25m and I've counted at least 15m in round figures from when I started paying attention. Certainly, (IMO), the mcap here in no way reflects the true value of the company. Not even close.

This is the competent persons report (dating from 2018) on Thorny River:
http://docplayer.net/85969229-Competent-persons-report-cpr-on-the-thorny-river-kimberlite-project-polokwane-district-limpopo-province-rsa.html

This morning's headlines:
China lets offshore yuan slip below key psychological level of 7 (i.e. the trade war is now worsening into a currency war)
China bands all US agricultural imports
Chaos in Hong Kong
Gold soaring to $1457/oz.
How long until China plays its best trade card and restricts rare earth exports to the US?

China now promising to announce retaliatory measures against the most recent US tariffs in the next few days.
Also, the situation in Hong Kong remains tense, with China threatening to send in the army.
This is an ill wind that blows (almost) nobody any good. One of the few exceptions is for rare earth miners and processors outside China.

Hi MinorMiner!
I hope you are right, though there was some language about a lock-in for at least some of the BMR shares in the original RNS that announced the deal (last year). Perhaps that has since been superseded.
BMR have / had about 25m GLR shares. Since I've been watching at least 15m in round figure sales have gone through, so we must be nearing the end of the selling, if your theory is right.

We're getting even more grossly undervalued now! We have a seller who is regularly unloading into the market - sometimes after hours - in 1m, 2m or even 5m round figure blocks.
I assume that these are broker shares left over from the April placing, and thus I expect the selling to stop at the 0.5p issue price (though, of course, the broker could sell into their commission and still break even, if they so wanted).
In short, we need volume to wash through these shares, and for that we need news. The Sable deal was due to complete in July, according to the last Jubilee RNS. I hope that we'll get confirmation of that early next week, at the very least.

Hi Supercharger!
You need to add to that "discount" the value of the "exploration dividend" that will become due to the holders of Acacia shares at the moment of conversion into Barrick shares (in Q4). The "preferred" (middle) value of the exploration properties on sale is $57m, which would equal an extra 6% dividend at today's share price, payable sometime in the next two years.
Buying Acacia is currently a way of buying Barrick shares at - very roughly - an 8%-10% discount. That should be of considerable interest to large fund managers.

http://www.alignresearch.co.uk/cpt-company/rainbow-rare-earths/