Member Info for TigerByTheTail

Hi Mr Trotter!
My opinion - for what it's worth...
It's not just HOC. Today most miners are down. As are airlines and retail. I think the market is now realising that conquering Covid is going to take longer than it hoped.
Additionally, gold is down a bit. And HOC, as ever, is more volatile than most other gold/silver miners. It really is the nitroglycerine of stocks.

Hi Ziquarat!
Fair enough - nobody likes dilution.
But BOD must be closer now to a commercial discovery than they have ever been. Given that Marsfontein had incredibly high grades, and that even the kimberlite dykes in the area are diamondiferous, I'm hoping (expecting, really) that the new pipe / blow ("the River anomaly") contains diamonds as well.
I know we're all tired of waiting, but we should know the answer to this question in the next couple of months.

Er, nothing achieved?!?
So, finding a kimberlite blow / pipe at Thorny River (which could be the next Marsfontein mine) is nothing?
And obtaining a diamond processing plant, some licences, a diamondiferous kimberlite pipe, and a whole lot of data in Botswana for a song is almost nothing as well?
Yes, nobody like placings. But let's keep things vaguely truthful, yes?

Hi Tornadotony!
If I've got the time tomorrow, I'll try and make a proper resource comparison with FTSE 250 miner Centamin.
Factoring in today's news, I suspect the two companies now have broadly comparable resource bases, even if wildly different mcaps.
Somebody (but not me) should also make a formal comparison with GGP and post it over on the GGP board. But if anybody does take that task on, expect only abuse for your trouble!.

21% up is hardly a bad result for today.
But I still think the full magnitude of today's news hasn't really sunk in, or else the market would have reacted even more strongly. (And it's not that AAZ was overvalued before today; for a well-run dividend-paying cash-rich gold miner it was rated pretty meanly). So, I think we'll get more buying tomorrow and on Monday, which will take us to 200p or so.

Even if the planned new operation at WK is ten times bigger than the current operation it would still be tiny. I think EUA must be defining "of this type" very narrowly indeed.
Why on earth has the board not released the DFS, rather than just saying it is completed?
And why have they been so vague and imprecise in their terminology?
I would be gob-smacked if WK became even a tenth of the size of Mogalakwena.

Hi Adam Smith!
I can't say much about Vejnaly, I'm afraid. Being in Zangilan Province, it was the first mine to be overrun in the war, and there were photos of it published in the press at the time. But I couldn't judge much from them - I remember just hills and piles of fresh looking spoil. It was said at the time it was a working mine (that is, until the Armenians fled).
But I think the other two mines are "the big ones". And they certainly are big!

Hi Gotreal!
Would Colin Bird lie? Have JLP RNSs in the past been deliberately obscure and frankly misleading? Is the Pope a Catholic?
(Actually, there are people around who would argue over the answer to that third question).
As said, JLP is a "story" stock. And you clearly believe the story you are being told. Good luck with that.

Hi Jammer!
I agree with some of your post, but not all.
You need to look back and realise it took JLP forever to get Hernic to work properly, even though they were copying the basic methodology from SLP (they poached SLP staff). IMO, JLP's vaunted metallurgical expertise is more PR than fact. In contrast, THS seem to get no credit for the fact they are building a fine chrome plant at industrial scale. Or that they are constantly working to increase PGM recoveries.
As for Kabwe, I know the story well. It's another failure to execute, of course, and one more recent than 2016. I stand by my unexploded bomb comment; wise companies don't screw around like this with the Zambian government. How long till the Zambians get tired of JLP's excuses? Kabwe is officially one of the ten most polluted hellholes on this green earth of ours, and JLP are systematically shirking their obligations to help clean it up.
Finally, as for institutional investors, in my experience they are often as reckless as us PIs. Perhaps more so; at least we have to bear the losses if we make mistakes!
p.s. Since Adam Smith mentioned AAZ, can I say they released the most incredible RNS this morning, and IMO the market hasn't yet grasped its full implications.

A small drop back today - $21,500/oz at JMAT prices. I suppose rhodium couldn't go on rising forever.
Pt over $1,100/oz and Pd nearing $2,300/oz, so overall basket price still very much at bonanza levels.

I believe AAZ will inherit the copper mine whole and gratis, even though it may take some time and involve some capital to start it back up again.
The situation with the gold mine at Zod is more complex, both because it straddles the internationally recognised border, and because it is owned by Russians and not Armenians, and the Russian state has considerable clout in Baku. So this will involve a tough negotiation.
IMO, the end point of the negotiation will be that the mine will go on operating in the same way, with the ore processed in Armenia. However, there will be a considerable wrangle over who gets what share of the future profits (and how much compensation the Russians have to pay Azerbaijan/AAZ for their illegal mining in the past).
The resource and the mine are both very valuable assets. How much of that value to attribute to AAZ now is a hard question. But some, certainly.

A poster on ADVFN just did the maths on the copper / molybdenum mine that AAZ have just "inherited". I think it is worth reposting here:
"Kyzlbulag - Nagorno Karabakh. This contract area contains the Kashen deposit in Nagorno Karabakh's northern Martkert region. Estimates have been recently published that the deposit contains 275,000 metric tonnes of copper and 3,200 metric tonnes of molybdenum. Molybdenum Price. $26,000.00. per metric ton. Last Updated: January 20, 2021 3,200x26,000 = $83.2ml LME Copper Asian reference price, US$ per tonne $7,822 7822x275,000 = $2,151ml or $2.151bl
The deposit has been mined by open pit and in 2016, an Armenian Company "Vallex Group", inaugurated an ore processing plant in which Vallex Group claimed to have invested US$130 million. The Armenian Government also announced at that time that they believed the non-ferrous metal reserves of the Kashen deposit were sufficient to keep the new plant operational for at least 25 years. As far as the Company is aware, the plant is intact and together with the mine is not currently operating.
Open pit operation with plant and processing in situ...."
I realise this is the spoils of war (albeit a war in which Azerbaijan were in the right), but the Armenians concerned have no title to these illegally-operated assets now. I imagine that AAZ will simply take them over, lock, stock and barrel, and operate them in partnership with the Azerbaijani government, as per their existing licence terms. It's a huge windfall.

Hi Smose!
Thanks for the posts.
I care about risk. As Buffett once said, avoiding losses really is the key to good returns.
THS, SLP, and JLP are all exposed to general South Africa risk. That's not something I rejoice in, but I regard it as tolerable.
SLP are also exposed to the risk of being dependent on Samancor, who are far from an ideal business partner. And there are questions about their life of mine and future growth strategy. Otherwise, they are a well-run, debt-free, cash-rich, highly attractive company.
JLP are exposed to:
a. Corporate Governance risk - Chairman Colin Bird is who he is (it would likely be libellous to spell that out), and people who idolise Leon Coetzer should remember that CB and LC have worked together happily for some years. JLP's reporting alone (wilfully obscure, sometimes deliberately deceptive) is a red flag. Another red flag is that CB has just sold his JLP shares.
b. Zambia risk. Zambia is in the very highest category of sovereign risk for mining operations (see Ragnar's posts below). I also note that JLP made specific promises related to cleaning up the toxic legacy of Kabwe in order to obtain permission to operate in country. These they have not kept. This is a time bomb waiting to go off.
c. Execution risk. JLP have s long history of failing to deliver projects, or of delivering them late. Platinum smelting - fail. Australian adventure - fail. Dilakong - never a success, never exploited the PGM content of tailings, ended in failure. Hernic / Inyoni - took literally years to reach decent recoveries. Platcro / Windsor - chrome operations at best break-even. It will not be an easy task to recover enough copper / cobalt from the very low grade tailings they will be processing in Zambia. Can they do it at all? How long will it take them to get decent recoveries? There has to be doubt about that.
In short, JLP is a "story" stock. It requires faith in a bright, better future on the part of its investors. I like stocks where the present is bright, and which don't really so much on a good "story", as on plain old maths.
So, for me, THS and SLP, in that order, and JLP as a punt stock when it is looking cheap (which isn't now).

Hi Tornadotony!
I've always found the Russian resource standards to be solid technically. It looks to me like the numbers for Zod quoted in the RNS are adapted from a Russian standard resource - reading downwards they would seem to equal Russian A, B, C1, and C2 categories.
Can you imagine what would happen if any gold miner announced that it had just discovered 6m ounces of gold (8m oz divided by 75%) at a grade of 3g/t+? And that is what - in effect - has happened this morning!
GGP eat your heart out!

Hi Richie!
If you have any questions I'll answer them on the AAZ board.
I know Azerbaijan well, so I'm pretty relaxed about the seeming risk. These are some spoils of war!

Hi JoinTheDots!
It's not often that reading an RNS in the morning makes me think "Holy Crrap!"
My guess is that the copper / molybdenum mine (275K t Cu resource) will fall entirely to AAZ as the spoils of war, as it was previously owned by an Armenian company.
I'm amazed that the share price reaction this morning has been so lacklustre - I would have thought 200p by the end of day. I can only assume that the sizeable seller that's been around for a while hasn't had the nous to tell their broker to stop selling yet!

Hi Addicknt!
You should add that Crux are not Muddy Waters as well.
If Muddy Waters came out with a bad report on SOLG, I would take it seriously and very likely sell. When Crux do, my calm is Zen like.
BTW, friendly tip, AAZ have announced some pretty incredible news to the market this morning....

As for the 120K oz Zod gold mine, 75% of which falls in Azerbaijan's territory, I guess the sensible thing might be to cut a deal with the Russian owners, so that royalties get paid to Azerbaijan and a share of the profits goes to AAZ, whilst the current workforce continues to operate the mine.
An 8m ounce resource at good grades (3g/t) is really something!

Fellow gold miner AAZ has just released some pretty amazing news this morning. I don't think the market has realised its significance yet...

Hi Tornadotony!
After a frustrating five minutes, I got in at 134p.
I don't think the market has quite realised the significance of this news yet - even the RNS had a dull headline for such massive news. I agree this will skyrocket over the next year. Just look at the new resources AAZ has just "acquired", basically for free.