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Brad

Do I hear the cavalry arriving in 30 minutes?

OH

Best to be cautious - I agree. Do bear in mind though quite a lot of the time scales you mention are taken by the effort to find finance - either institutional or strategic.

It appears that a strategic investor may have already been found by our BoD. i.e. the Prominent International Investor" (PII). The BoD may have restricted the investment taken to avoid dilution. It seems the PII has already invested a considerable sum in TUN next door, and as Brad points out so well you don't buy a kitchen (Hemerdon) and the ingredients ( Redmoor) if you are not going to open a resaurant. If that "restaurant opens, then the time scale will be shortened considerably and the orphan period in the Lassonde curve may be transitory.

Brad - -great post, agree with your logic.

A small but nevertheless positive point....The infill drilling was already funded by the £4m raised in January announced 22/1/26.

The £4.7m investment by "PII" came a couple of days after the infill drilling announcement so can be used for other things e.g. PFS/DFS

So it seems SML is funded with that £4.7m by cash flow from Cobre and potential inflow from LC. And PII may come back for more shares.

I think transport may be an issue to overcome though. Tomra's do remove 50-70% of waste matter from the ore, but that still may leave 10,000's of tonnes to transport for further processing at Hemerdon.

RMC80 Catalysts...........................

Results of infill drilling,

PFS

DFS

Potential for designation as National Strategic Asset

Ministerial intervention on planning and other permits

Successful finance raising -NWF/ DoW/EXIM/ PII/Coffey/Offtake agreement

Intervention by major

Intervention by neighbour

Further pressure on tungsten supplies worldwide- slow resolution to Iranian conflict/ China Taiwan

Start of construction of decline or possibly a shaft.

Orphan period? A period when a company is looking for institutional or strategic investors to fund the building of its mine and processing plant.....

For SML it looks as if it will be very short if there is one at all. It will be interesting to see who the "prominent international investor" is - hopefully tomorrow or Thursday. Looks like a strategic investor to me, as it also appears to have arrived on the TUN share register.

Hear what you say. Tomra ore sorters can reduce the volume to be processed considerably - at Hemerdon I believe the reduction is expected to be 70%. That still leaves a lot of ore to move but it is 4 times the grade, 5 times on a tungsten equivalent basis.

Bear in mind the SML MRE will be accompanied by an updated economic analysis too. Predators may wait for the results of the in fill drilling but I think SML is vulnerable to a bid from now on. Not a red herring in my view but something which makes holding onto SML shares more attractive.

It is true TUN have had a very difficult period and built up debt, but that was converted into B shares which are now around half converted into ordinairies.

TUN's position has been transformed - just as SML said the recovery rate -up 19% was transformational, - by the explosion in the price of tungsten/APT not up 19%, but up 6 fold. TUN is expected to go into production Q3/Q4 this year. It will generate huge quantities of cash. But the amount of cash could be quadrupled if it was processing SML ore from 22 miles away. The other major factor is that instead of waiting several years while SML builds a processing plant, ( at a cost) TUN could be doing it. It doesn't take many years saved, at whatever discount rate used, to generate a massive increase in project NPV.

TUN may well wait until SML has proved a reserve rather than a resource, but will others wait?

The arrival of the "prominent international investor" on both share registers speaks volumes. You may not like the idea, but it cannot be ignored...........

Addicknt

Agree with you. If TUN shares move up and SML don't, SML will be a tempting target rather than a tempting JV. But before ore from Redmoor can be processed at Hemerdon, a mine has to be permitted and built. So perhaps TUN will wait for the orphan period before making their move. That would risk someone else scooping the pool from under their nose.

Bellers................You are likely to see quite a lot happen in the next week................GL

Half a billion dollars bet on oil minutes before Trump climbdown

Some 6,200 oil futures contracts changed hands before president announced energy strikes ceasefire, raising concerns about insider knowledge

+9.22% so far today.................... News likely to break there too before 31 March. Will likely draw positive attention to small miners in the SW.

Perhaps not yet a good correlation, but watch the share price mOn the way up again over there.

Good morning Brad.

Merge or tolling - we think the same way. I tend towards a merger or takeover -(for paper) judging by the appearance of the PII on the SML share register who has also invested big time in TUN.

But trucking will not happen this year. It will take months to get planning (even if Redmoor gets SNA status) and at least 12 months to get a decline built.

However given the dire shortage of tungsten and its use in munitions I think we can expect the stops to be pulled out and HMG may even awake from its talking shop slumber and sloth.

Good morning Prop

That is an interesting link - whilst it repeats the well known story re tungsten it shines a light on how the US approaches the situation. I was struck by:-

"The Pentagon sought fresh supplies of ‌13 critical ⁠minerals — including tungsten — from industry partners the day before US and Israeli strikes on Iran began." In other words they seem to have been insider trading. Knowing the war was coming and prices would rise, they tried to stock up.

We may have seen the same yesterday when some reports have said there was a spike in trading in oil/oil companies 15 minutes before Trump posted on Truth Social about delaying action against energy infrastructure for 5 days.

The price is for APT 88.5% WO3 min cif Rotterdam and Baltimore duty-free has reached $2,500-2,899/mtu

Great news for finalising the debt negotiations.

Who will be TUN's dance partner?

Forensic 505

I think you are undershooting the likely zeus valuation considerably in your post of 10.34am.

Re your point 1. If Revenues rise because the tungsten price rises, don't forget the impact of operational gearing. A 10% rise in revenue through price will generate more than a 10% rise in profits or free cash flow, because of the impact of fixed costs. Take a look at Cornish Metals sensitivity analysis for example, a 1% rise in tin price translates into a 3% rise in NPV. Probably best to be a little more restrained here but it is almost certainly better than one for one. So if prices rise from $650 to $1050 a 60% rise It would be pretty safe to allow for a doubling of profit or FCF. So perhaps a jump from 4.8p to 9.6 p (not 7.5p)

That is also true for your point 2 - a 19% rise in recovery bringing a 19% rise in revenue, again will increase profits or FCF by more that 19% thus increasing the NPV by more than 19% I would conservatively estimate 38% so 9.6p would go to 13.4p

Re your point 3, I agree it is difficult to know the increase in the size of the resource. SML have indicated tonnes millions they hope to achieve and it might be a 40% rise, but just sticking with your 10% seems safer, so 13.4p goes to 14.7p.

A further increase in valuation may come about if the project is speeded up relative to the previous time frame envisaged.......... Working with Tungsten West would achieve that - perhaps saving 5 years of building. Zeus may not put that in their valuation, but it must be a possibility and could increase the valuation much further. . i.e. Remember that when /if the shares get to 15p....

Also of great interest is where we are on the Lassonde curve. Are we pre orphan period? I am wondering if we may be about to fast forward through that.. The orphan period is one where the investors waits for the company to find funding for the project and is working towards a DFS to present to bankers to fund the project.

If SML ties up with TUN and uses TUN's processing plant little capital will need to be raised. Perhaps £15m to build a decline and £15m for working capital and equipment.( Not £100m-£200m) So where are we with investors who might provide that? Step forward our "prominent international investor" (see RNS of 19 March ...The Subscription was led by a prominent international investor who approached the Company, which the Board views as a strategically important moment in the Company's development.......) who has just provided £4.7m by way of subscription. If, as rumoured, it is a fund associated with Greg Coffey, finding the rest of the funding will be straightforward. Remember if was also " a prominent international investor" who put £29.3m into Tungsten West recently, See Tungsten West's RNS of 5 February 2026.

We look set for an exciting 2026..............................

Prop

You mentioned "other options exist for them other than Tun West" in one of your recent posts. What are you thinking about? A major coming in with a bid, a tie up with Almonty or EQ Resources or sale to a big consumer of tungsten?

I think the opportunity to tie up with Tungsten West, to bring forward production by perhaps 5 years is compelling. It would very significantly increase the NPV which in any case is going to increase massively, with expanded resources, a higher tungsten price, an improved recovery rate. Such a tie up would reduce risk as well and would make the most of the current high prices for tungsten. Clearly the "Prominent International investor" who has invested in both TUN and SML is going to be keen to see that happen.

Vii

Prop - agreed its a pleasant outlook to discuss.

One thing to bear in mind is the cost of delay. A 5 year delay to SML production costs around $2.4bn on the NPV, so every year that ticks by without a tie up costs around $500m. That is quite a lot to share out between the two sets of investors - some of whom will be in both companies. But, nothing can be processed from Redmoor until a decline is built - and than is over a year away. Oh to be a fly on the wall in the -I think- inevitable discussions.

Prop

The current valuations, do, in my opinion undervalue both companies.

But I think current valuations are not relevant to the case to be made for putting the two companies togehter. Both benefit hugely from working together.

Current valuations may however be relevant in negotiations about pricing a merger or takeover. If you think one or the other of the two companies is underpriced , then that would perhaps be the one to favour in your portfolio. The "Prominent International investor" appears to have bought both - big time which suggests that the benefits of putting them together outweigh any short term under valuation of either.

Sorry..................... "If mining and processing takes 25% of that you are left with around $7.5bn" should read $6bn.