Hopefully we are just 7 days away as implied by the Chairman of the company. It would be hugely significant for the company. 1M tons of copper in the ground has a value. At $7,000 a tonne revenue price and taking $70 a tonne in the ground valuation equates to 50p on the share price.
RE: Look forward to CD's 14p re-entry in September24 May 2022 13:39
Nobody knows the future gold price. In Q1 of 2022 it was $1874 per ounce. In Q2 thus far it is $1894 although drifting down unless the gold price can get back above that figure. The company impairment model on page 72 of the annual report was working on $1842 gold price for 2022. It therefore works thus far for H1 with just 5 weeks to go. Eric has said the company needs $1800 gold price to achieve all their objectives. Singuida is half complete and it was not harmed by inflationary costs. If an agreement is reached with the Tanzania Tax authorities on VAT repayments owed to the company , it would have no debt on the delivery of the new Singuida mine.
I have left an order on the book if they want to offer further HZM discount prices. I dare say other investors may have orders going in. It depends if someone has a cash call somewhere else that sometimes give opportunities for book orders to get filled.
Next higher low is 13.5-14p range after 13.25 double bottom on sell side. Next higher high on a bull chart track is 15.5p-15.75p on the close. A higher low then makes way to a higher high. The next higher low at 14p will need news in late June if the chart pattern continues. Rainbow has made these type of chart patterns in the past and we are observing if they can repeat.
Shanta existing producing mines. 365,000 probable reserves plus 40,000 proven reserve ounces. $100 x 365,000 + $140 x 40,000 = $42.1M enterprise value. The g/t at 3.05 is economic at $1350 gold price.
Resources value at 1 million ounces approx adds $20M to the enterprise value.
Singuida has 218,000 reserve ounces valued at $21.8M. It has 180,000 measured ounces valued at $5.4M and 700,000 inferred at $7M = $34.2M on the enterprise value.
West Kenya has 378,000 ounces as resources and is worth $15.1M ($40 taken as having higher grade). The inferred resources has a value of $16M.
The in the ground enterprise value of all assets is $62.1M + $34.2M + $31.1M = $127.4M or £102M.
It is reasonable that plant value is greater than any on-going or slight build up in debt.
The company is therefore trading at worse at its in the ground value which is equivalent to fire sale prices. Companies usually trade at 1.5 times to 2 times the in the ground value of its assets where it has a functional mine and especially if it was to add a second mine.
Other factors are the security of the asset, can the asset be mined out commercially, does the team have plenty of experience and are they reputable and competent with delivery and do the projects offer scale in production volume. I believe Shanta scores well on many of these aspects.
The resources alone thus far recover the initial payment for WK. Once the drilling programme is completed, the additional new resources converted and inferred resources added should recover all the mining costs incurred by the company.
The bond for Saltend only is being subject to ESG clearances. The bond funding is anticipated at some time between 15 June and 30 June. Ministers will be invited to the Saltend site for an opening ceremony in July. It appears that the arrival of all the funding is not all in one go as it is taking longer to deliver that way. 3 rare earth mines have expressed an interest to have some of their ore processed at Saltend if a gap of ore deliveries from Angola occurs.
It was clear that Estonia plant back in November 2021 decided to introduce the possibility or ore to metal at their facility and hence why Rocky wanted a much bigger site for Pensana to also have the same capability.
My wife has a friend who works in Mastercard USA. Apparently the staff bonus and pay rise was a pittance of what they normally get. It appears USA folks are no longer as keen to use their Mastercard and so workloads are dropping rather fast. So much for the USA consumer weathering all the inflation and rate hits.
The Philly data was dreadful and the rate rises have only just got started. The central banks are in a hopeless mess. If they keep raising rates economies will blow up. If they let inflation run and do not put up rates the economies will blow up. The only thing that can solve this is agreeing for the war to end in Ukraine with some face saving retreat from Russia with an agreed meaningful treaty to ensure it does not happen again is the only way out but that is the hands of politicians who do not want peace.
The hikes have just started and the Philly production data is barely positive. A couple more 0.5% rate rises State side should see them at Covid 19 March 2020 crash prices with job losses in large numbers to follow. Gold up $28 so far today. Another State the Democrats may lose next time around.