Member Info for wasarunner

Thing you have to get your head around is that if you are a company like Urbix, you are looking at the same demand curve for graphite I posted the other day. Unlike an investor in Armadale or Blackrock, we can mull our investment and put our money in when we deem the time is right, perhaps wait a year or two till financed and mine built. Urbix are looking at that demand / deficit curve and if they want to be in the game at all, they have to procure supply now for 2 years time -> because if they don't their competitor will lock in the same supply. And they won't be unique plenty of Chinese and non Chinese companies will likewise be looking to secure supply now for 2 years time and on terms they consider favourable now - they know that with deficit comes increase in price among other things. So perhaps Blackrock take a prepayment deal which favours Urbix on price but which means a reduced capex requirement from equity leading to reduced dilution to mine build. The point being is if you have plenty of demand for your product you have options of how you finance the deal (essentially Armadale may be able to choose prepaid offtake v equity) and you can try (from the producers point of view) get the best deal squeezed out that is on the table. Demand for graphite should only increase, the deficit is soon, and offtakers should be falling over themselves to lock in a deal. This will in turn put the burners under miners like Blackrock to build the mine as the deals will have time constraints built in to make sure the supply can be achieved in time. This is the kind of time to be financing your mine IMO when demand is outstripping supply (already) and people don't know where supply is going to come from in 2 years time. It is all about timing and the timing is 'imminently' :)

I'm probably over excited today (on a sad day for GB) but IMO days like today are the days you make real money. Clear indication that there is demand for a given product (in this case, high grade natural flake gaphite for Tanzania) with a competitor getting closer and closer to lining up their mine build, and you have huge and glaring value disconnect because the markets are disconnected (AIM v TSX) and general prevailing macro weakness. The old adage buy when others are fearful I think can't be more apt for these situations. I added again modest amount this morning. GLA

Just on DJR's point billion value - probably not until the mine built because while you are building the mine there is always still risk and equity is the first to fall. But you'd like to think we would close at least some of the £200m -> $1bn/£1bn gap during the build as each stage gets de-risked. I'm still looking for that debt drawdown RNS where the banks release the funds - AFAIK we are (or have been) still spending the equity money to date? Debt drawdown will indicate banks happy with any preconditions to release funds and hopefully we are halfway through build by then as the debt is circa half the capex. GLA

Sorry just read back yeah I was referring to the 1 trade for £70k size. Ok fair play there are a few big PI buys also going through e.g. DJR but there is definitely some institutional shares changing hands (both ways I imagine as some would appear to be sells over the weeks).

Exciting times but as ever apart from macro will be driven by newsflow from the company. I am hoping for further news on the Araguaia build and some news on Vermelho now in the next few months, if Vermelho DFS is lined up to run concurrently with the Araruaia build we are well into that period now....

River yes I know it is suitable for ev just not sure if any more work to do. Or is it sufficient for binding offtakes and finalised dfs etc. It's not 100% clear from the rns but what's clear is there is us and chinese demand for product and in theory we have what blackrock have.

It shows they were in discussions in parallel with the licencing. I'd like to think we are in discussions in parallel with getting govt % finalised. If BKT get fully financed in Q4 (I can't see them hanging around now, everyone wants their product) I think game on for us to advance our financing. I'm reluctant to call timescales but I don't see a reason we couldn't have finance closed next year and be building a mine into 2024. The one thing I'm not 100% sure on is where we stand with proving our product. Obviously the naysayers will say that bit isn't done (I know BKT spent a lot of time and money proving theirs with POSCO).

Fair point Amtech! Generally I want it higher as pretty fully invested. Nevertheless this is good news today and my SP target is a long term one it's pretty obvious we aren't going to get there overnight. Nice to see Blackrock up 30% but they are on ASX I have a feeling there is a better understanding of mining valuations there than on AIM. AIM tends to get sold off sadly on any rise. i.e. if we announced the same news I doubt we would necessarily get 30% and £100m mcap....

And for people who care about SP - Blackrock up 32% today, mcap $174m AUD £100m mcap. Armadale £11m mcap. Yes they are building a bigger mine (and are further advanced) but only 3x bigger (module 1+2 than our stage 1) not 10x bigger.... and the return on our capex is better than their return on their capex so technically we should be valued higher on higher IRR. All IMHO

They are essentially saying they are able to raise 4.5x our capex because they have enough demand side to get that financed. Anyone still think we won't get our $40m finance and MB isn't playing a clever game to wait till they got theirs? I shouldn't really be talking it up of course because I would like some more at this price :)!

https://blackrockmining.com.au/wp-content/uploads/MahengeEnhancedDFSWithExecutiveSummary25Jul19.pdf

So from their enhanced DFS:
Module 1 capex 85kt/yr product $116m capex
Module 2 capex 85kt/yr product $69.5m capex

So they are going to in parallel build 2 plant capable of 170kt of end product.

By comparison from our latest DFS we have
Stage 1 60kt/yr production $40m capex

BKT are going to need an awful lot of infrastructure to build the 2 'modules' in parallel - road + energy. No brainer to re-use what gets built to support that operation.

About Urbix, Inc
Urbix, Inc. is a US-based graphite processing technology company that has developed a proprietary
technology to process (purification, spheroidization, coating, thermal treatment, air classification) natural flake
graphite and is currently undertaking the financing and construction of manufacturing facilities to produce
graphite lithium-ion battery anode products in the US and potentially other regions, commencing around late
2024

So looks like US companies recognising the need to get a foothold in good commodities in Africa.... bearing in mind they already have binding offtake agreements with Phase 1 with Chinese companies they are as we guessed diversifying their client base.

. The Agreement means Black Rock can
potentially bring forward construction of Module 2 concurrent with Module 1 through Urbix providing or
facilitating a substantial prepayment and/or equity support for exclusivity of offtake of -100 natural flake
graphite fines from Module 2.

Well well well. Premayment and/or Equity support for offtake for Module 2. Accelerated development.

And lest we forget - Blackrock have (I think?) already raised the amount of cash we need for our full capex?? So no problem demand side here. We will get financed but we have to accept we are behind them in timeline.

https://blackrockmining.com.au/wp-content/uploads/BlackRockSignsConditionalFrameworkAgreementWithUrbix09Sep22.pdf

Nice to see always institutional buying on an aim share sets it apart from the crowd. Unless the £70k buys are Hazbeen topping up! Surely a matter of time only before a rerate in which case first proper target has to be the financing price I would have thought - 140p (but I'm not a technicals person). Gla

To be fair damp squid is also apt :) I agree but:

1. Damp squid/squib outcome here is asset sale. I maintain with the resource and in a graphite deficit market in 1-3 years we could sell this (the damp outcome) for a multiple of todays sp with no more development. That for me is worst case and
2. The powers that be are, in the case of Armadale:
a. The Tanz gov. Tax + free carry are incentivised to 50% of profit to get this going. They own half our profit.
b. The BOD. Who are heavily invested.

The interview with De Vries clearly makes it clear that they align 100% with the Tanz gov that both parties need the mines to be built for mutual benefit. And that's why, I think it will get built. BKT need to unlock the financing/show us how its done, then we will follow.

https://twitter.com/HorizontePLC/status/1567823941221105664

Not often Horizonte have mentioned EV. Wonder if this kind of tweet starts to pave the way for an update on progress (and possible marketing) around Vermelho.

No idea - but to constantly berate and mention a lower price than the current price is, to me, and indication that you want it lower. It isn't a typical investors position. For e.g. leathal quite clearly wants the stock higher! Just saying.... if I held a share I wouldn't constantly mention a lower price I am going to trade it. We are all frustrated but your motive may be different. Are you Kabunga by any chance :)

Yes she mentioned commissioning so I believe whatever it is has been commissioned! Apparently they wanted one that could be moved around site, the original one they had couldn't be (not sure if that was a permitting reason or something else) but the new ones can be moved.

Consumers of raw graphite are themselves suppliers of the refined product and as the deficit hits will be scrambling to secure supply. My own heartfelt apologies that Putin invaded Ukraine (truly I have regret as it was a heinous act) triggering global recession following the worst pandemic in 300 years, that I didn't foresee it therefore suggesting we may have been building a mine in this 'dry' season from May onwards.

HI Xeiger, I spoke to Emma a few weeks ago and we now have 2 of something we previously had 1 of, and apparently the 2 are individually bigger than the 1. Unfortunately I didn't ask more about this I don't know which component this is. But the 2 together have several times the capacity of the original. I know it is something they envisaged being able to easily relocate around the site to be closer to where the mining is where the original was static. I'm not an expert so I don't know if this is the gold room or crushing circuit or what but maybe with someone with more knowledge can figure it out from the above.