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Interesting. I came to a very different conclusion. The risk/reward is very different. Cleanteq is about the lowest risk junior miner you will find, but this is reflected in the valuation already. If it goes up 2.5x from here then it hits it’s NPV. Niocorp is currently 1/16 or so of its NPV.
That’s a pretty crude measurement as there are a lot of assumptions in the NPV that could sway either company a huge amount in either way, but it does give an example of the much higher risk/reward ration of NB.
Cleanteq is still double where it was two years ago. Can’t say the same about NB, but I hope you realize you are allowed to choose both.
I emailed a similar comment to Jim. He is likely aware of this, but as sporadic as the tariff decisions have been there is a chance he has not gone through the most recent list.
I do not agree with using NB as a political tool, but the fact of the matter is this would make a perfect strategy to prove we are “winning”. Tariffs on the Chinese, government loan backing per the infrastructure plan to spur private investment, followed by a new mine that may or may not have been economically viable without the intervention. It is shady but fits the corruption that built the Trump empire. It is also the little nugget that could blow reasonable share price predictions out of the water. One little #Niocorp by the Tweeter in Chief and there is no telling where the pps goes.
A truly free market can not prevent manipulation, else it is no longer free. That is capitalism. You could make every single one of your arguments against Amazon right now as well.
If this is all the case, why wasn’t the ground freezing technique used for the FS results?
The technology is not new. Nordmin has done it before. Nordmin was involved in preparing this part of the FS.
“An analysis of these and other
options determined that
the Waterline to the Missouri
option was the most
environmentally, socially, and
economically feasible option.”
See slide 38 of the most recent investor presentation. Was ground freezing included in this analysis? If not, why wasn’t it? If so, what changed that the waterline is no longer the best solution? Something is missing from this story.
If you are skeptical of the project, the final permitting into the MO River may not have been going well. I took particular notice to the comments on the net CAPEX change. One could be lead to suspect that this will result in higher CAPEX. An optimist may say that financial discussions are going so well that the CAPEX is now secondary to the production timeline, which the freezing will certainly hasten.
Chinese Scandium will be subject to a 10% tariff, along with other rare earths, should Trump go through with his latest $200B tariff threat. This policy is idiotic for many reasons, but especially given the only currently mineable domestic source of REE’s is Chinese owned. Alas, this protectionism could propel Niocorp and is certainly newsworthy given Jim’s meeting next week. Below is a link to a Chinese article on this topic.
https://m.scmp.com/business/commodities/article/2155101/us-shooting-itself-foot-tariffs-chinese-rare-earth-elements
My understanding is that the only one of real significance is the air construction permit from the Nebraska Department of Environmental Quality. As of 3/31/2018 this application had not been submitted. This is the only other permit specifically mentioned in the last 10Q, so I infer that the rest are simply typical building permits from the local AHJ.
The last quarterly reported indicated operating expenses for the first three months of the year averaged to $450k/month and that it was anticipated the company would need $6MM to fund the next 12 months of activities so $500k seems like a more accurate "burn rate".
I am more interested in knowing how and when Nordmin is being compensated.
Considering they have $500M in cash on hand, I wouldn’t be too worried about a face plant.
That would be a lot easier if he was a legit moderator. I’ll ask again, what point are you trying to make? This is the same question I’ve been hounded with on the other board. All I’ve done the last couple days is shown concern for both companies. What do you have to offer to this board?
We live in a global economy. China is a part of that. Nevertheless, Cleanteq already has an agreement with Airbus, a French company, for their Scandium alloys. Airbus would be their top customer. Which users does Niocorp have agreements with that can validate their pricing model?
What’s good for the goose is good for the gander, as MS as repeatedly said. The CLQ forecast is not good for any prospective scandium producer that isn’t ready to absorb a ten year ramp up of production.
You mean my post about the underwhelming FS released by Cleanteq? Both companies agree that they will be synergistic. A poor FS result from CLQ is a negative for Niocorp, especially when it comes to the Scandium forecast.
I don’t know what your problem is. I posted factual information about the CLQ FS on the NB board. I didn’t promote it as positive. It’s negative information for both of these companies. You obviously have an issue with those that disagree with you, but if you keep up your work Landmark might give you a turn as cheerleading squad leader.
I wasn’t aware of this. I only visit this site from my iPhone so I can’t put a cursor on it.
DFS was released with rather disappointing results.
https://globenewswire.com/news-release/2018/06/24/1528590/0/en/Clean-TeQ-Sunrise-Definitive-Feasibility-Study-completed.html
A review of the sensitivity analysis shows every 10% drop in Sc price is about a little more than a $300MM drop in pre-tax NPV. $1500/kg then puts pretax NPV around $400MM. If you assume the increase in Nb throughout the life of mine you can add $250MM back to the NPV.
What do the two green circular arrows next to a post mean?
Absolutely. The difference is that CTQ has reiterated their findings from two years ago, while suggesting that 10tpa in additional production is all the market can currently absorb. No other source is yet to validate Sims previous statement, but it is known that Niocorp believes aerospace to be the largest consumer of high grade Sc. CTQ has an existing agreement with Airbus based on their findings. There has been no public release that NB has a similar agreement with an aerospace manufacturer.
This discrepancy in outlook should be carefully considered, especially given the fact that both companies agree they need one another for future development.
Doesn’t a stale peanut analogy suggest someone is over charging? CTQ is selling at the same purity. CTQ believes the viability of the Sc market is contingent on prices at $1500/kg. NB and Matheson are the only ones to suggest $3500/kg is a sustainable price at projected production rates. Both companies agree that even as competitors they will be synergistic. Do you not value the third party opinion of a company that has already financed over a third of their capex?
CTQ has agreements with KBM Phillips and Airbus, both European companies and CTQ’s targeted sales area. What does China have to do with this?
If you want to take one company’s word for it based on the opinion of a single individual then more power to you. I’ll continue to look at the outlook of others with an invested interest as well.
I have not seen it in the DFS but have not yet read the entire thing. Previous PR’s indicate 99.9%, the same as Niocorp.
https://www.news.com.au/finance/business/clean-teq-produces-999-purity-sc2o3/news-story/e21a6feac0788d7a7acecdd92135175f
Anybody else bother to read the Cleanteq Feasibility Study released las night? (For those in North America anyways). They used a Scandium price of $1500/kg and only predict 10 tonnes of sales per year for the foreseeable future until the market takes off, but still believe the market will not develop at prices higher than that. They plan to stockpile it in the meantime. They added the capex for Sc production that wasn’t included previously. Capex is now 1.3 billion. Post tax NPV is 1.4 billion, which is a significant increase from the prefeasibility study due to adding the infrastructure for the Sc. Share price was down 12% on the news.
I’ll try to run numbers later to see how Niocorp would far under Cleanteq’s market assumptions for scandium.
What would $16 or $45 per share put the market capitalization at?
I’m quite impressed by your thorough research.
Do you guys always have such delight when others fail?
No need to revise. I can admit when I'm wrong!
You will see a 3-4% spike at TSX/OTC opening from over excited retail investors on volume less than 15,000. Close will be within 1% of today’s.
Go back and look. It’s always been referred to as a third party technical review.
The rest certainly should have been disclosed earlier. Hence the numerous requests over the last few months for a shareholders update.
Nb is a well established commodity. There is not a comparison to Sc.
The third part review has been described in every single press release as a technical review. MS has spoken about it multiple times. Google Niocorp and RPM Global. Engineers aren’t economists and don’t stamp their names to pricing assumptions.
I mostly agree. This isn’t really news, but it does reiterate how over due a letter to shareholders is.
The third party review stating no fatal flaws was a review of the technical engineering. It was not a review of the market forecast for any of the products. It essentially says that the chemical process should work as planned, that the initial (non-detailed) mine design is adequate, and that the geological reports are within the level of confidence indicated. It is purely an engineering review and has nothing to do with the finances of the project.
The fact that 13 engineers signed their names to the FS does not mean that each one of them reviewed all 898 pages. You can find the sections that each engineer was responsible for on page 29 of the FS.
Section 19.1.3 contains the pricing forecast for Scandium. Grant Malensek, MEng, Penf/PGeo is the only one to sign off on the pricing.
The independent report was and always was intended to be an engineering review only. This has been mentioned here many times.
The 3rd part review was a technical review of the engineering and geology only. It did not include the market analysis or any other financial information. To date, Matheson’s assumptions have been reviewed and signed off by only one engineer. You can check the FS and the summary at the beginning listing which sections each engineer claimed responsibility for.
Any one that thought this was getting financed without further review of a currently non-existent scandium market has had their head in the sand. This is exactly why many of us have said this wouldn’t happen without an offtake with a price floor. The best verification is a contract.
CleanTeq has only reported on their scandium reserves. The pre-feasibility study did not include Sc in any of the pricing models.
Their BFS is expected to be released by June 30 after being delayed from an original targeted date in Q1. I would expect to see some scandium assumptions at that time.
Restrictive shares are included in the outstanding shares number. The only thing that’s not included in outstanding shares are warrants, options, etc. Total diluted shares gives you the total shares assuming all of these are exercised.
I would be interested to hear why you consider 10% a conservative discount rate when the FS numbers used 8% and many other companies go as low as 6%.
Top line is revenue. The top of the form in accounting. Bottom line is net income. The bottom of the form after you account for all expenses. Landmarks comment wasn’t incorrect, but it would be odd for a miner to brag about an increase to the top line revenue without an equivalent bottom line increase.