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Scottrader......... Looks as though the ACCESS is going thru for the ROAD and the Gas Line............ NOW for the Big Decision, FEIS coming on July 24th..............
.20 to $3.00....................
NotRich....... Just a clue at times, Don't Follow the so-called EXPERTS. I would judge MS sold off at the LOW .40's, and I would assume everyone on this Board was picking up those give-a-way Nak shares........
Looks as though that Nak celebration dinner is on the near Horizon............. :>)
BJM......... And, the Harvard Experts at Morgan Stanley made a bad decision.........
SHORTY is on FIRE......
WWalker........ But he did say, "FEDERAL AGENCIES AGREE TO PEBBLE CHANGES"............. A sound interview with important highlights......... Thank you for posting the interview..........
Mrplmer........... Nak ready to EXPLODE..........
http://schrts.co/RNTnpEfb
Hulk....... The FEIS is only a few weeks away on July 24th for the FINAL APPROVAL....... Anytime after July 25th for the Big Ones............ YOU CALL IT.....................
Tootal...... Many thanks for keeping us up to date....... We should start getting ANTICIATION BUYING shortly as Nak gets closer to D-DAY, July 24th...........
Hulk....... The day that Nak swings into action, I would enjoy coming up there to do some fishing with YOU...... It would be great fun..........
Excellent increase in Stock Price today.
Current stock Price at 3:33 pm is $16.90..........
$16.90 divided by $3.67 earnings = 4.6 PE............... If the AVERAGE STOCK SELLS AT 10 PE, DOES IT APPEAR THAT CMCL WILL SELL AT THE RATE OF
$46.00.....................
AND WITH THE INCREASED DIVIDEND, WHAT A OVERALL PAYOUT.................
Alaska NEEDS revenues of GOLD/Copper......... BHP is exiting OIL......... Rio Tinto has offloaded COAL.........
GOLD is where the ACTION is............
Northern Dynasty is OUT of the Pennyland, and headed for the DOLLARS...........
BHP overstayed in petroleum — time to exit
Bloomberg Opinion | June 30, 2020 | 9:20 am Energy Top Companies Australia Oil & Gas
U.S. widens battle for global oil market: allows condensate exports
BHP oil rig | Gulf of Mexico.
BHP Group’s future can do without hydrocarbons.
The world’s largest digger is among the last heavyweights to mix mines with a significant presence in oil, a combination that is becoming harder to justify over the long term. Crude demand will be slow to recover after a pandemic that has kept workers home and jets grounded, and some of that appetite will never come back.
Meanwhile, pressure to cut carbon emissions is only increasing. Oil giant BP Plc is the latest to take a hit, warning it expects impairments and write-offs worth as much as $17.5 billion due to a more gloomy view of what lies ahead. The Big Australian could benefit from a dose of that realism.
RIVAL RIO TINTO GROUP OFFLOADED ITS LAST COAL MINE IN 2018, WRAPPING UP A PROCESS THAT BEGAN IN 2013
There is little question that the petroleum division, with assets from Western Australia to the Gulf of Mexico, has generated impressive cash over the years — if you exclude the ill-considered foray into U.S. shale, a $20 billion investment (excluding capital expenditure) much criticized by activist fund Elliott Management Corp. and eventually sold off in 2018.
In the six months to December 2019, the unit accounted for about 13% of BHP’s total earnings before interest, tax, depreciation and amortization, notching up an impressive 65% margin. Only iron ore, the group’s top earner, was higher, at 69%. Add in low production costs that cushion the blow of 2020’s lackluster oil prices, and it’s easy to see why putting in more cash is tempting when, as analyst Glyn Lawcock of UBS Group AG points out, the miner has few readily available alternative investments.
Wells, Wells, Wells
It’s also true that while the medium-term global appetite for oil looks far less certain than it did, there’s a more appealing argument to be made around fading supply. Indeed, the $115 billion miner’s central expectation last year of demand hitting a high point in the mid-2030s now looks bullish, compared to comments from the likes of Royal Dutch Shell Plc and BP.
A peak even in the middle of this decade, BHP’s low-demand scenario, may prove optimistic. On the production side, though, the miner is right to point out that the industry has been investing less, a trend that will only accelerate after a disastrous 2020 and squeeze future production. BHP has estimated ongoing natural field decline at a rate of 3% to 5% per year.
None of this means boss Mike Henry and his team can afford to ignore the signs that this year will prove to be a turning point for oil.
Diversification has benefits, but operating synergies between oil and mining are debatable — it’s not an accident that while majors sold out of one or the other, none have returned. As a standalone business, the petroleum division might arguably have ventured less enthusiastically into shale. And the risk today is clear: Staying on can turn into overstaying.
Here, Henry can reflect on the experience in thermal coal, where BHP woke up too late. Rival Rio Tinto Group offloaded its last coal mine in 2018, wrapping up a process that began in 2013. BHP held on to decent assets, using up tax losses. It’s now trying to retreat just as Anglo American Plc prepares to hive off its South African coal mines, and interest in the dirty fuel has dwindled. Oil has fewer easy substitutes, but it’s conceivable that, with significant changes in policy, crude could be left similarly stranded.
Accepting the need for an exit from a business that BHP has been in since the 1960s is only the first step, of course. For one, a carve-out in the mold of coal-to-aluminium producer South32 Ltd.,which BHP spun off successfully in 2015, is harder to advocate for oil.
The move then was about getting more out of sub-scale operations. In petroleum, BHP is not the operator for many of the assets, making such efficiencies harder to accomplish.
BHP can begin by reviewing its portfolio, starting with mature assets in Australia. Partner Exxon Mobil Corp. has said that it’s seeking a buyer for its share of the Gippsland Basin oil and gas development in the Bass Strait; a joint sale with BHP has been considered before. Chevron Corp., meanwhile, has put its stake in the giant North West Shelf liquefied natural gas venture on the block.
That operation, Australia’s largest LNG project, is shifting from processing its own gas to opening services to new suppliers, a business known as tolling — less suited to either Chevron or BHP. The mining giant has in any event been less enthusiastic about gas than oil.
Lucky Country
Granted, even that won’t be easy. Australia churns up a decent amount of revenue, and BHP can argue it is better to continue taking cash now, at the risk of selling for less later. Some investors may agree. A similarly short-term view in the Gulf of Mexico could see it adding to the portfolio as distressed rivals are forced out.
For newish boss Henry, though, none of those would look like the decisions of a company preparing for a greener future. He has an opportunity to outline the path to net zero emissions when BHP announces full-year results in August. An exit plan for oil would be one decisive step toward that goal.
(By Clara Ferreira Marques)
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Hulk...... Down the road they will enjoy the Gold and Copper........... At least they will then be able to cash in on the RICHES........... 42 people with thousands of acres for each of them, will be an adventure when the Gold surfaces..........
GDXJ is ready to BREACH $50.00.............
http://schrts.co/tCAkYIfB
HULK........ SALMON: $10.00 A POUND.........
NAK: BILLIONS of $$$$$$$$$$$$$$$....................
THOSE ARE THE HARD FACTS....................................
MonsurOrleans
MonsurOrleans' Blog
Pending Northern Dynasty Minerals LTD's (NAK) News Could Make Price JUMP To $21 With Over $10 Billion Valuation
Jun. 10, 2020 2:58 PM ET|About: Northern Dynasty Minerals Ltd. (NAK), Includes: BBL, FCX, GOLD, NEM, NG
Summary
We believe the regulatory hurdles for Northern Dynasty are largely over and the State of Alaska is supportive of the mine operations.
We believe a financing deal for Northern Dynasty is imminent.
We believe the mineral deposits Northern Dynasty controls are worth $11.2 billion using a Discounted Cash Flow model.
We believe Northern Dynasty’s comparable firms (comps)indicate a valuation much higher.
Based on both a discounted cash flow model and comps, webelieve Northern Dynasty’s valuation should increase to between $5 Billion to$10 billion, indicating a stock price between $11 and $22.
Northern Dynasty Minerals Ltd. (NYSE: NAK) owns the mineral rights to one of, if not the largest undeveloped gold and copper mines in the world. The property, named Pebble or the Pebble Project, is in a remote area of Alaska where a flight is the only practical way in or out.
COMPANY BACKGROUND
The Pebble mine’s potential footprint is light compared to many others, but during the Obama Administration, the company ran into an unusual battle with the Environmental Protection Agency (EPA), that did not start to loosen until the end of his administration.
Even after the EPA removed their objections, the federal permitting process has been slow and methodical. This is to be expected, partly because the mine is about 100 miles away from world class fisheries in Bristol Bay.
To ensure proper environmental concerns are addressed. Licensing processes starts with the environmental impact statement (EIS), which is overseen by the U.S. Army Corp of Engineers (ACoE). They in turn work with other stakeholders, such as the EPA, Northern Dynasty, environmental lobbyists and more.
Pebble has spent hundreds of millions of dollars on environmental studies, and many of those studies have proven relevant. The long permitting process is starting to move quickly.
The ACoE released a schedule regarding the Pebble project and the mine registration process. That timeline can be found here. So far, the actual timeline has largely mirrored the projected one. For example, in the projected timeline, a draft EIS was to be submitted in February 2019 and it was. Public Review of draft EIS was on target too.
On May 25th, U.S. Army Corps of Engineers (ACoE), the lead federal regulator for the Environmental Impact Statement (“EIS”) permitting process for the Pebble Project, proposed an acceptable process for the environmental impact of Pebble (see here). This process assuages many concerns about water transportation and salmon production.
On May 29, 2020, the Environmental Protection Agency (EPA) expressed confidence in Pebble permitting and opted not to elevate approval (see here). A move, they have indicated meant they would not oppose permitting further.
According to this ACoE timeline, the Final EIS (FEIS) and Record of Decision (ROD) are to be completed in the next weeks. We believe these events are largely a foregone conclusion now that the EPA is not opposing permitting -- see here.
Who is left to object before that short timeline? Afterall, those opposed had their opportunity during the ACoE and EPA vetting process. Arguments and complaints were heard according on the scheduled timeline of ACoE.
REMAINING REGULATORY HURDLES
The State Regulators: Alaska has an incentive to help Northern Dynasty get to production. According to Northern Dynasty’s CEO, there will be 2,000 direct jobs during construction, 1,100 to 1,200 jobs during operation, each mining job paying between $100,000 to $120,000 a year (see here). The county in Alaska where the jobs are to be delivered, is the poorest county in all of America (again here); And the state of Alaska will collect royalties and taxes on all of the mining production during a time when it economically is suffering.
According to the Anchorage Daily News, Governor Mike Dunleavy is a proponent for the Pebble Project, so long as the science supports it. Further outside environmental groups don’t want Pebble examined under the light of science because they know it will “pass with flying colors” (see here). So, it is reasonable to assume that state regulators will be friendly to Northern Dynasty.
So, we believe the government of Alaska is a proponent not an opponent.
The Federal Regulators: After FEIS and ROD, it is difficult for any legal challenges to stop mine production, even those from whomever is the next president, because that person will not take office until after ROD.
Native American Tribes: We believe tribe agreements will happen because there is a large monetary benefit likely to be given. Also, tribal live would likely be better with better access roads. Lastly, the footprint of the land is so remote and small, that fighting for its domain likely does not make sense.
However, even if tribes oppose, the state of Alaska can force easement and is incented to do so for the reasons mentioned above.
Other Lawsuits: Of course, there likely would be lawsuits, but since there was already a vetting process and since the EPA and ACoE are supportive, those efforts will likely be no different than other mines who made it this far through the registration process.
OTHER HURDLES
Financing
Northern Dynasty is already on record for saying it needed financing, and that it will happen shortly, meaning before FEIS (see here and here).
We reiterate what we wrote above, FEIS is imminent, so believe an announcement for financing will come in days or weeks and likely will be a Joint Venture.
The capital expenditures to mine in such a remote area, is not small by any means. A joint venture (JV) with capital expenditure, assuages and mitigates many of these concerns by allowing the deep pockets to confront these challenges. We believe acquisition or a JV is very likely for the following reasons:
Northern Dynasty has successfully entered JV’s in the past
Northern Dynasty’s gold and copper mines are the biggest reserves in the world and make a very attractive JV opportunity
If a major mining company does not enter into a JV with Northern Dynasty, they risk being surprised in production by those who do
It represents a lot of money to these firms and notoriety
Joint Venture or Acquisition
Possible companies to do a JV or acquisition are Barrick Gold Corporation (NYSE: GOLD) and Newmont (NYSE: NEM). They are very large gold companies, see here. Or for Northern Dynasty’s copper, suiters could be Freeport-McMoRan Inc. (NYSE: FCX) and BHP Group Limited (NYSE: BBL).
However, one stands out above all the rest because of “the history”. Barrick.
On October 12, 2017, Pebble hired James Fueg to be its V.P. of Permitting. Mr. Fueg oversaw permitting at Barrick's Donlin Mine and had worked for Barrick. When Pebble hired him, it was probably considered a secondment rather than him jumping ship from Barrick.
If Barrick does a JV with Northern Dynasty, the recent decision by the ACoE to use the Northern Route, could prove to be useful to Barrick’s Donlin asset, because it could use the Northern Route too. How perfect would that be!
So, if Pebble is acquired, what would become the valuation of Northern Dynasty? The answer lies in the numbers:
VALUTATION
Discounted Cash Flow Model of Just Minerals
Northern Dynasty’s Vice President of Corporate Communication stated (here) that the Pebble mine will run for at least twenty years and produce annually 318 million pounds of copper, 362,000 ounces of gold, 12.3 million pounds of molybdenum, and 1.8 million ounces of silver for the next twenty years.
We used that data and a current metal prices of $2.56 per pound for copper, $1,698 per ounce for gold, $10.89 per pound for molybdenum, and $17.59 per ounce for silver—to determine the future value of these minerals. Then, using a discounted cash flow (DCF) model, we came to a current day valuation of the minerals. Our assumptions were a 7% discount rate, six years before they could start production, and an annuity of 20 years. This calculation results in a valuation for the minerals of $11.2 billion (see below):
We believe a 7% discount rate is appropriate, given the current economic and political environment. However, even a 10% discount rate, would yield a valuation of $7.7 billion (see below):
It should be noted, this is not discounting back the cash-flows or considering expenses. The reason for this is simple:
We don’t know what expenses will be or even have a clue because the company is pre-production and a lot can happen
If Northern Dynasty gets a JV, then there capex will be covered at least partially by the JV and for likely a very long time.
So, speculating on expenses without any clue about all these parameters makes no sense whatsoever. In the company’s valuation below, this is already considered in a discount.
Possible Upside
We believe the future price of precious metals could rise with increasing political, economic, or viral turmoil, which represents upside to the mineral valuations above.
We believe mining for more than 20 years or 10% of the measured and indicated minerals, could represent upside to the mineral valuations as well.
Comps
According to Northern Dynasty (here and here), its copper and gold mines are the 1st or 2nd largest undeveloped deposits in the world. Barrick Gold Corp (Ticker: GOLD) has much smaller remaining deposits. Yet Barrick has a valuation north of $41 Billion. We believe Northern Dynasty should have a valuation at least 25% of that of Barrick’s, since it has much greater value of resources.
We understand that there is still regulatory hurdles and production hurdles left for Northern Dynasty that Barrick has already passed. However, when factoring the remaining risks and the time to production, we believe a 75% discount is more than enough to account for these factors. Particularly given that the DCF model accounts for the time factors and supports this type of valuation and the remaining regulatory hurdles are low now. A 75% discount on $41 Billion would put Northern Dynasty’s valuation at about $10 Billion or $21.63 a share.
Novagold (Ticker: NG), like Northern Dynasty, is also in the permitting and pre-production process. They have a J.V. with Barrick; however, they have much fewer mineral reserves. For comparison, Novagold was scheduled to process 53,000 tons of gold per day compared to Pebble’s proposed 100,000 to 200,000 tons per day (see here) . So, Pebble has two to four times more gold (which is not considering how much more copper and other minerals Pebble has).
Yet, Novagold has a valuation of 2.65 Billion. If that valuation is used with shares outstanding of Northern Dynasty, that equates to a price of approximately $5.73, however since Novagold is much smaller (at least half it’s size in gold and without the copper capabilities), we believe it is reasonable to attribute a multiple of two to four times or $11.46 to $22.92.
CONCLUSION
Pricing based on comps and a DCF model is between $11 and $24. However, most comps and the DCF model support a price in the $20s. We suspect that Northern Dynasty management is looking for financing partners and that a partner will be announced shortly based on this (here) timeline published by management.
Disclosure: I am/we are long NAK.
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They call it EMINENT DOMAIN............
.30 - $3.00....................
LSSR........ To Highlight your Point, ONLY 42 people live on Thousands and Thousands of Acres..........
Petemantx........ GOOD POST...........
Couldbe.......... One additional important factor, the United States is a politically STABLE country. Any mining company should put that factor as one of the top considerations to make beforehand these days. As we read many mining companies in foreign countries change agreements AFTER the mining company gets a mine up and running.......
Sox.......... Done
SOX........... Done....
SOX........... Done....
IPIX Board, here is the Email Address to the White House....................
https://www.whitehouse.gov/contact/
Karin........ Earlier today, I sent this Post to the white House, for the President to see, and they send it to the FDA....... Why don't all our Board Posters send this Link to the White House. If the nation and the World ever needed a VACCINE, it is NOW!
Maine....... YOU SHOULD HAVE BOUGHT NAK ON THE DROPDOWN....... MISSED OPPORTUNITY.
Oddone....... Thank you for this important Post of YOURS. It is important, and I sent the LINK to the White House requesting that they scrutinize it and give the information to President Trump, and the FDA........... The main problem in the United States today is China Virus.......... Again thanks.......
Can't get BETTER than this..................
https://www.barchart.com/stocks/quotes/SRNE/opinion
Bruce....... Looks as though we are sitting at this level QUIETLY awaiting some news coming out to get NAK roaring............
.30 to $3.00
JTOREMCE............ PEOPLE SAYING IPIX IS GOING TO BE A HOT COMMODITY, AND YOU ARE WORRIED OVER .004............ YOU GOTTA BE KIDDING.......
Dow is OFF 710 points at 230 pm........... SRNE Up over 9 percent.............
DIA....... Here are some FACTS...........
https://www.barchart.com/stocks/quotes/SRNE/opinion
NAK BATTLECRY............ .30 to $3.00............................
Stargazer....... .30 to $$$$$$$3.00
Billy10.......... A focused and dedicated professional that you are. You are certainly a prize to the medical profession. In todays newspaper, on the front page, there were 2 Doctors that came down with the China Virus treating their patients with this deadly disease, and passed away. Dedicated men.......... We need B NOW,,,,,,,,,,,,,
.30 to $$3.00..............
BILLY10.......... What a great post. It was truly enjoyable reading, and wish you the success you will enjoy after the years of treating people........ I am a newbe just in Ipix for a few days.
NEW TECHNOLOGIES......... What does the WATER SAY.....................
Finding the next mineral discoveries using bore water analysis
Powerful technologies and precision instruments are breaking barriers on the path to new resources and metal discoveries
By Lynnel Reinson
In this current time of volatility, facing risks including pandemics and climate change, gold is highly sought after with investors and central banks turning to gold as a safe haven asset for storing value. With new gold finds on the decline (Gold discovery rates continue to decline) and exploration dollars on the rise, large mining companies are expanding exploration efforts and turning toward innovative methods that explore in potentially more efficient ways, for not only gold, but newly in-demand metals supporting and building the green economy.
Over the next ten to twenty years low-carbon technologies like electric vehicles and wind turbines will require vast amounts of metals, which are in short supply at the moment. Hydrogeochemistry is a promising tool for finding new gold and metallic deposits capable of boosting resource dependent economies in both
traditional and increasingly ‘green' metals. The ‘data-rich’ surface areas have been explored and well characterized; new finds will only exist in under/unexplored areas.
These ‘data-poor’, underexplored areas have been ignored because drilling blind - at depths - is prohibitively high in cost. Hydrogeochemistry is not new but its only now that that this revolutionary tool is being more widely adopted for searching under those thick layers of gravel and sands that prevent standard sampling techniques from working. Some forty plus years after its start in Australia, the use of hydrogeochemical science in exploration is on the rise (Reid, 2020). Geoscience Australia’s Luke Wallace explains the basics, “as water moves through rock, a little bit dissolves here and there, and that signature is preserved to give us an idea of what the underlying geology is like.” CSIRO source.
Dr. David Gray pioneered exploration hydrogeochemistry and his team of Commonwealth Scientific and Industrial Research Organisation (CSIRO) scientists in Australia found ‘mineral signatures’ in water correlated with areas of known deposits of gold, nickel, zinc, and copper. He described the endeavour, “What we’re trying to do at CSIRO is help explorers find deposits that are under the ground; 50 metres, 100 metres, even more than one kilometre below surface.” The utility and financial benefits are realized once the mineral signature in the groundwater is matched to known regions of mineral types, to “pin-point the presence of ore bodies” CSIRO source. Proving out the resource with targeted drilling reduces the number of drill holes, effectively reducing exploration costs while finding potentially economic deep resources.
Industry leaders including Rio Tinto, AngloGold Ashanti, Independence Group and AARON minerals are some of the groups working with CSIRO on hydrogeological exploration methods and creating the continental hydrogeochemistry atlas (Reid, 2020). Australia is the leader at the moment, having devoted years to collecting and standardizing over 300 000 data points to get a picture of what the water can provide. From tens to potentially a hundred metres below the surface lies the rock to be investigated so rather than needing directly drilled samples of rock, the ground water is sampled instead.
At operating mines drilling for new deposits to expand operations, hydrogeochemistry can be an attractive tool, as the area surrounding mines is often already studied and at least partially characterized. The opportunity to make even better use of their existing drill data – specifically, the mineral signatures in the water – is a more efficient use of exploration dollars. Reid warns that it gets tricky near mine site operations where dewatering pumps are active making knowing where the water has been more difficult; understanding the area’s hydrogeology and lithology is a crucial aspect of understanding ‘what the water says’.
For hydrogeochemical exploration to gain wider adoption, easier access to data is required; CSIRO has put together a field guide to encourage sampling by industry with a straightforward document for ‘non-experts’ to use. Outside of Australia, companies are beginning to follow the path taken by CSIRO. In the USA, Nevada Exploration is an early adopter that has executed a multi-million dollar regional- scale groundwater sampling program and is now advancing a number of otherwise-covered Carlin-type gold projects that its hydrogeochemistry-led efforts have identified.
In discussing hydrogeochemistry as exploration, Nathan Reid predicts its best use lies in making new discoveries. Along with understanding the lithology and hydrology of the area, he confirms that ideally, modelling would help better interpret the water data in those cases; he suggests the perfect use at this time would be choosing the exploration tenement.
Earth is rich in minerals but the gulf between the rate of success and the cost of exploration is rapidly widening. Today’s thirst for electronics and the electrification of everything requires a vast amount of metal to build. Mining asteroids and deep- sea exploration will not provide for us. We rely on explorers and the support of agencies like CSIRO to rise to the challenge and develop tools to make new discoveries buried right under our feet.
About the author:
Lynnel Reinson operates her own communication strategy company, Lynnel Reinson Communications, in Vancouver, BC, serving clients in the resource and education sectors. Her areas of expertise include developing and refining clients' digital content and reporting and she works directly with clients to clarify and improve their business
practices. Currently, her business research is focused on developing new practices to integrate communication strategy with sustainability for these unprecedented economic conditions.
Sources
Lawson, K. May 20, 2016. “Mineral waters reveal deep reserves.” Commonwealth Scientific and Industrial Research Organisation, 2015-2020 https://blog.csiro.au/mineral-waters-reveal-deep-reserves/
Murphy, K. May 1, 2018 “Gold discovery rates continue to decline”.
https://pages.marketintelligence.spglobal.com/Gold-discovery-rates-continue-to- decline-full-article.html
Reid, N. Feb., 2020 Interview by Reinson, L.
Bruce......... Great Post......... Barrick it is.........
CHINA VIRUS PANDEMIC IS INCREASING IN THE UNTED STATES......... The pressure is ON, to bring a Vaccine to market...............
https://www.msn.com/en-us/news/us/is-the-pandemic-getting-worse-in-the-us/ar-BB15JjCp?li=BBnb7Kz