Member Info for Tornadotony

Pensana has broken through two resistance lines this morning in the technical chart. The third which is the strongest resistance line is at 88p. A breach at 88p will in effect be a breakout.

The in ground price of gold at the present time valuation is 10.5p for this stock share so this is incredibly undervalued.

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.

https://www.cityam.com/business-secretary-backs-vital-minerals-plant-to-reduce-dependency-on-china/

DP

Yes I do understand the difference and I just did not want to write out the full title, okay. Looks like your in a pedantic mood. TT

Why I added. I have another tranche to buy at some point. I should comment that a lot of sectors were in the red yesterday.

PA also stated that some funds would be provided to the Angola mine project from July until its bond was finalised. The projects are therefore broadly still starting at the same time.

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.

6.7p top up.

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.

It only works with USA housing market as UK impacted by Brexit etcetera.

In August 2011 it was 97.2 oz gold for a median house. In December 2015 it was 193.45 oz. In February 2022 it was 203 ounces. The relationship is perhaps distorted by what happened in 2008.

Sotolo,

It is all about what gold will buy not to be related directly to the inflation ratio. The gold/SP 500 ratio is just 0.46. A ratio of greater than 1.0 has gold over valued as it was in 1980 and 2011. If the SP500 falls to 3000 than gold is at fair value at 0.60 (It was 0.59 in the flash crash on 2020). So if the SP 500 deflate to 3,000 the future of gold is flat at $1800 per ounce which is still a port in a storm. If the SP 500 goes to 3500 and holds support and gold goes to 1900 the ratio is 0.54 and at 2000 gold that ratio is 0.57. So gold rallies if the SP500 finds and holds support as the SP 500 hits a bottom (soft landing). If SP500 can not hold 3,000 then gold sinks further down from 1800.

Another method is gold and real estate ratios but I need to look at historical exchange rates to work that one.

https://www.proactiveinvestors.co.uk/companies/news/982442/anglo-asia-mining-s-reza-vaziri-says-2021-was-the-most-important-year-to-date-982442.html

A lot of interesting comments. Ratification expected end of month.

Gav
Centamin, Polymetal, HOC, Fresnillo, Shanta and the list goes on have all been hit. Shanta, Centamin, HOC and AAZ have a growth trajectory. I recall Fresnillo has a new mine to come on when they fix power lines to it.

Once the ratification comes through the AAZ stock should rerate higher as the company and everyone who works for AAZ has around 10 years more of job security.

As Zafar is accelerated to be in production next year in H2, we await the ratification news and terms of the agreed in principle PSA. The ratification in the ground only resource value has a value along with having a fair PSA agreement as the company has a lot of development spending to do. The day when news hits it will be difficult to acquire stock at current prices.

The end of year book value is higher by some margin on the current share price. The financial models for copper on 25% less than the current market price. They have silver at $22 and gold $1830 which has worked so far in 2022. The company has mined below reserve grade in Q1 as to preserve grade mined out during the year.

Lets assume that only 150,000 tonnes of copper at reserve grade is attributable to the company after Government equal share to mine out over 10 years at their model price of $7,000 a tonne. This gives $105M annual revenue attributable to the company for copper alone. Gold will exist in the copper produced and the company will still be generating 4 years of gold at 50,000 ounces when including Zafar. Lets assume that gold is spread over 10 years to remove peaks and troughs. The total revenue per year is $36M for gold and probably another $1M or so for silver. $142M revenue projection per annum mainly delivered from copper prices that are modelled 25% below the current price.

I would say the jam tomorrow is fairly significant. Sometimes if you want to see 60% plus returns, its worth waiting 3 years to get it especially when the dividend beats everything else on main street.

Part of the reason for the non-disclosures is that ratification processes are on-going. Once those processes are complete we should then have a far better outlook and perhaps Hardman can deliver a new report with a 2022-2026 profile as they have done so before. They can also provide a financial model outlook as well. There is an order of things being done and clearly facilities and plant are being invested in. Eventually AAZ will get a positive re-rating once it all drops into place. The gold production on the reserve grade is being produced at steady state and it has several years of supply for all the copper production growth to be delivered.

It appears the copper production increase is being phased over 5 years. The initial step up is over the first 2 years and then a greater transformation in shift is in years 3 to 5. This may coincide with declining gold production in Gedebek. What they have not disclosed at this stage is how the growth profile will look, but with good copper prices at those times it should be very promising.