Member Info for zeusfurla

Nick I started out on advfn a few months back but it has gone downhill recently. I engaged with Plat but gave up eventually. There are 1 or 2 others similar unfortunately. Last few times on advfn I've just advised posters to come on over to LSE for some top quality debate and factual analysis. Here is the place to be!

Ophidian Thanks for the info on days worked - I wasn't aware of that. The 37.5 days lost included strike days from Q3 - I'm not sure how many there were. Using your figure of 325 days improves the Q4 full production figures I posted earlier (although I'm not sure the 230mtV stated in the RNS may be a bit low?).

We have 325-37.5=287.5 working days over the last year which gives 8.9mtV/day worked. If we multiply the number of days lost in Q4 by 8.9mtV (if we use the annual average rather than the Q4 run rate which is probably higher post Phase 2) and add this to the 657mtV already reported we get -
- if 10 days were lost that gives +89mtV and 746mtV overall potential production for Q4
- if 15 days were lost that gives +133mtV and 790mtV overall potential production for Q4.

This makes the Q4 figures better than I had thought at the time. We are likely above 3000mtV pa at Q4 production rates.

Gambitxjs/MarcoT I don't think we have the information to calculate Q4 production excluding downtime precisely. The 37.5 days lost included strike days from Q3 and maybe even other odd days from Q1/2. Taking a pro-rata calculation doesn't give a sensible answer as production levels presumably increased as the year went on and Phase 2 was implemented. I don't know the number of days the plant operates in a normal year. Does it shut down over Xmas/New Year? If so, we have 365-37.5-14=313.5 working days over the last year which gives 8.1mtV/day worked. We'd need to multiply the number of days lost in Q4 by at least 8.1mtV (if we use the average) and add it to the 657mtV reported. eg if 10 days were lost that would give +81mtV and 738mtV overall, not far short of 3000mtV pa in Q4. Actually I think this makes the Q4 figures a bit better than I had thought at the time. Happy for others to modify or correct these figures if we have a better knowledge of days worked or lost in Q4.

Thanks Jamiejojo for posting the advisory USTDA document on energy storage. The introduction to this document sets out what I believe Bushveld is possibly uniquely well-placed to deliver in SA and regionally -

'It has been suggested that the adoption of energy storage technologies could
provide a cost-effective way of improving South Africa’s electric grid. Specifically, the adoption of
energy storage could offset the need to use diesel and other fossil fuels for peaking and baseload power,
provide backup power for commercial and industrial operations during blackouts, and increase the
capacity of South Africa’s electric grid to successfully integrate renewable electricity generation
sources, especially intermittent power sources such as solar and wind. '

This is environmentally sound as well as good for business.

Some further extracts from the 541 page document (I haven't read it all!) 'Manufacturers that provide reliable systems at competitive prices through efficient manufacturing practices will achieve increased market share and improved bankability.'

'Vanadium flow batteries will likely be a dominant long-duration discharge application in the coming 5 years, and they could dominate the long-duration market (>4 hours) over the middle to long term through 2030.'

All very positive indeed for Bushveld should we get through the successful commissioning and testing of the Eskom battery.

I didn't think I'd get the chance to buy more at sub-35p but happy to top up - thanks for your shares!

I recall the main discussion being about a volume seller the details of which we have not yet seen.

Concerted shorting going on today. A highly risky strategy.

Thanks for setting out your thoughts. I am in complete agreement and also not surprised that BE is under the radar on just how significant the battery commissioning and testing is likely to be, leading to the likely award of a contract later in the year. I was encouraged reading Ramaphosa's 10 points yesterday and again it gave me confidence in the leadership team at Bushveld. They are positioning themselves in the right place at the right time and are saying the right things as well as getting a seat at the table of those with influence. Here is a link to Ramaphosa's comments.

http://www.miningweekly.com/article/ramaphosa-challenges-mining-to-take-ten-value-adding-steps-2019-02-05

Points 1 and 6 stress the importance of beneficiation. Those outside SA may see the Eskom tender as just another to bid for but those who have prepared the ground will be more likely to succeed ie Bushveld.

One further thought from me. Increasing the quantity of vanadium mined is also a high priority in the short-term not just to take advantage of medium term higher vanadium prices but also to ensure that VRFB production can take off in 2/3 years time with a sufficient supply of raw materials. Brits and Mokopane here we come!

BBN Our posts crossed over. You have articulated the compelling case for BE and VRFB's far better than I could have and thanks for that. In terms of business value I think it is essential that BE has a plant up and running locally to produce electrolyte for the reasons you have stated. It is a critical part of the business model. Sometimes a light bulb goes on in your head and I have had that light bulb moment this morning. Wow! Win 1 contract and Bushveld is in a great place to take advantage of market opportunities as well as meeting corporate social responsibility aims. I am now going to ignore short-term share price fluctuations as the story here is going to unfold in its own time.

Alfa Thanks for your insights. As someone from a finance background what you have posted is hugely significant in financial terms. I really can't overstate this enough. The value in the VRFB value chain lies with those who can mine vanadium and then use it to produce and lease electrolyte whilst retaining ownership over an asset that can generate an income stream almost indefinitely. Making battery cases etc is not value-adding enough. I now understand the reason for the leasing model - it is the only way to go for Bushveld and this gives me huge confidence in what BE is doing. If vanadium in electrolyte is able to be used almost indefinitely, by mining it Bushveld will have created an asset that does not depreciate over time, or at least does so minimally. For the cost of ongoing and periodic maintenance (not likely to be significant) there is an ongoing income stream which must be more accretive to the company in the medium and longer term than selling vanadium for steel rebar. Over time it should become the company's modus operandii. It also means that setting the leasing framework is largely based on how much confidence the company has in the adoption of VRFB's as the default storage application for grids and local/area storage and use. It is not primarily based on financial considerations, although a profit has to be made. In addition to generating almost indefinite income streams from VRFB's these batteries meet so much need in sub-Saharan Africa that they will have widespread political and public support.

If I was Fortune I'd be focussed on gaining first mover advantage in VRFB's in SA as a priority over everything else including JSE listings, Lemur and Vametco productivity gains as the reward in achieving this would transform the company into something far more than a vanadium miner. I suppose I have just understood the financial implications of being a vertically integrated vanadium miner/battery producer with an asset that has an indefinite shelf-life and am getting quite excited about it! Success in the upcoming Eskom tender is a must and given the planning over 3/4 years that has gone into this as covered by many others on this BB, Bushveld is well-placed to deliver.

As someone who studied chemistry briefly 40 years ago at school I don't have the answers to the questions popping up in my mind such as -
- what happens after the 20 year life of a VRFB is over? What is it that actually wears out? Can the electrolyte be transferred into a new casing? Presumably 20 years down the line VRFB's will be significantly more widespread and reuse in a VRFB may be more likely than being used to strengthen rebar? It's also likely that other vanadium sources will be mined by then.
- how will a leasing model work in financial terms? With the price of vanadium likely to be high and volatile for the next few years how does Bushveld maximise its income and profit? It can't get stuck in a 20 year fixed price contract I'd imagine. Does it need to build in price review points to reflect vanadium pricing changes or is the asset (vanadium) effectively able to be used indefinitely in batteries which means an income stream could be generated over a very long timeframe? This would lead to a lesser need to recover the costs of mining vanadium over the short-term. Another factor would be if and when vanadium batteries are proven to work well and contribute to a more renewable planet (if we have not all burned up by then) this would create more demand for VRFB's which would be difficult to meet in the short-term given the inelastic nature of the supply?

I am hoping Alfa/RichKen/Ophidian and any other chemical experts may be able to enlighten a layperson like myself!

I wonder if successful completion of commissioning is the main hurdle for BMN to overcome prior to the award of a contract from Eskom? Other issues will no doubt come into it but I think if we get past this stage (and why shouldn't we) we can look very positively to a contract award late Summer.

Alfa Maybe they are thinking of trialling a larger number of smaller batteries? Also is presumably quicker to trial and less expensive. All tentative comments given the expertise of others on this area in the BB.

I had thought that was superseded by comments that it would be out in Q1. I'm not holding my breath for this week but some time in the next month I'd say. Good to say a few more PI buys in recent days as interest starts to pick up a bit. There's a lot of news waiting to be released re Cascabel drilling presumably now coming with the PEA? Should be a positive time to be a holder.

is the purpose of this board. Not infighting between its members. We can all learn from each other if we post with good intentions. Let's not get back to where we were a few weeks ago..................

Alfa Thanks also from me for the terrific report on the Eskom Battery site visit - and also to Sanchez599. All appears to be going to plan on commissioning. It must be yet another positive to have Pat Frampton advising BE as well as Eskom, given his long experience in the field. Everything around Bushveld's venture into VRFB's seems to have been so well planned over the last 3 years or so. All the dots are being joined up. They have put themselves in the best possible position to take advantage of the huge opportunities in the renewable energy field. I wonder if the LFB battery with its significant power is also a fire risk as some other lithium batteries appear to be? Very interested to see the results of a black start - had never heard of that term before.

beatthebroker I couldn't find any other info on Malcolm on a quick Google search so I guess we will have to wait and see - you may be right on the garden leave idea.

BBN It will be interesting to find out in due course if Mr Curror remains in post at Bushveld. He is still on the company website's management page although that may not mean anything. I would be encouraged if the transformation programme has followed on from decisive action taken by Fortune to improve the throughput at the plant. Whilst bringing in consultants is a statement of intent to improve production, I would have thought those running the plant (Mr Curror in particular) would have a significant degree of understanding of how to get the most from a plant they have worked with for some time. Overall the steps taken are highly encouraging and I am confident we will see much improved production in 2019, whatever it takes to achieve that.

Uncle John I am in agreement with your earlier post. My response was targeted at Cindercone's specific comment saying that 'a lot of LTHs are jumping on the back of our tame seller and deliberately dragging the SP down' which I do not agree with. I can understand a LTH holder exiting a position with BMN or any other company having made a significant return.

I can't understand why any LTH or even short-term holder would sell when prices are low - a guaranteed way to lose money. Isn't the theory that we do the opposite if we want to generate some wealth? I can see some sense in selling high to keep some powder dry for sp dips - this would be more logical.