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You want them to merge? Well maybe it would be good. But if you think Niocorp is the best thing since sliced bread your upside would be diluted heavily by a company that just suffered a 10 for one rollback. Personally I'm not so sure it would be a bad thing now that Largo has the shot in the arm. Not sure if Arias Resource Capital Management LP wants Largo diluted by NB now that they are so all in.
Market cap is 1/24th of pre fease after tax NPV now. Dirt cheap. Nice to see yesterday's gains hold. I fully expect (and hope) that next month's hydrological and metallurgical reports to support pre fease assumptions. You will be able to, as JJ said, look at pre fease and those results and have a very good idea about what the BFS will bring. Then perhaps this absurd discount will close. I'd like to see 1/5th before too long - which since the cap ex is so low and scalable would be, in my mind, reasonable for target leg one.
I do not know. But focusing on the improvements, and I feel they exist, prior to the BFS and finding a way to announce them (updated PEA? - it's commonly done) would be my recommendation (which I offered) for the very reason you suggest.
Mark will do the best and his backing/commitment is solid. They will not run out of cash. More loans if needed will be provided was what I was told and I'm sure it is the case.
Hi Stark. That was a good summary of my concerns. I also said all along the way there may be significant improvements to be found on cap ex and metallurgy. I remain convinced the project should show robust economics at more conservative commodity prices. I have said, and still do, feel confidence that there is room for significant improvements in the metallurgy and cap ex. I was not provided concrete info in this area and nor should I have been. But a deeper understanding of the path to here and the path forward does give me confidence that those can be achieved. Small changes in both would be a game changer. Also, this is likely a 50 or 100 plus year mine. Not 30+. It's just not sensible to spend money to support that at this point.
Also discussed at length was CBMM's expansion. I am satisfied that capacity increases do not equal production increases. CBMM wants the industry to have what they need and accommodate the smaller players. Mark thinks they want need meet the goal of providing needed supply to continue the secure growth in it's useage. I buy it.
I also told him (since I'm a numbers nut) more data is needed before I get bullish. He said it's coming. I think it is.
Met with Mark Smith today for over an hour.
I must say this company could not have a better CEO. He is fully committed to unlocking the value here and marching it forward. I told him that my cautionary posts were just that. People have come to respect my opinion and some where over weighted in one idea. He also told me my posts were reasonable and he had no problem with them. I have cleared my deck with what I have previously said as being cautionary in one idea. It's just sensible. From this meeting I believe that seeking improvements in project economics is not only possible but likely.
The man at the top is pretty damn impressive. Best of class.
Tell that to Resolution. McCain was instrumental to the land swap.
http://resolutioncopper.com/
Dude, Rosemont is different. Florence is different.
To oppose a sensible project requires not just time but a lot of money. They are unfunded due to the greenness of this project. Like I said serious opposition doesn't go to where their credibility would be shredded.
FYI the board has a 7 term congressman from the area.
The board also has Lord Robin Renwick. Former ambassador to the US from the UK and good friend of Senator McCain.
Please. Go to Phoenix and meet the crew. All tick boxes have been checked.
Thanks for seeing the potential.
The fact is an organized opposition will need to be funded. Excelsior will be using best of breed science in their applications. The opposition will need best of breed science to refute it. That takes funding. From what I see and hear no serious groups are interested in this. This is remote. This is safe. This is green. It's not the fight to pick - makes them look stupid.
There are a lot of differences with this project and Florence. And Florence did get draft EPA approval. It likely will be permitted.
One Florence is in town.
There are well heeled real estate interests funding opposition.
Florence has water users on site and have to work around that.
Many many others.
Gunnison is in acid consuming rock. Down flow there is a large limestone structure that would eat any acid if a failure of systems would occur. There is zero risk to the aquifer.
Gunnison is a mile away from an open pit mine.
Gunnison has 3 PhD's preparing the permitting documents. It will be the best of breed application.
Since you are down there you should go to their office in Phoenix and speak with Roland Goodgame or Stephen Twyerould and get up to speed. 10 bagger potential.
That meshes perfectly will the anticipated production schedule. Perfect storm?
Slowly eaked up to 54 week high close today. Seems some peeps are starting to look harder and crunch numbers... mkt cap still 1/30th of pre-fease after tax NPV.
I'm just saying that in this tough market that gains in metallurgy that the PEA must have used(costs of recovery per kg of FeNb & Sc) would greatly improve the IRR and lower the price of FeNb and Sc that is would be helpful to make the economics work (to current prices for FeNb would be good). I'm not an expert in that area but I feel and hope there is room for improvement and that would be very useful as well. If they can find room in capex cost that would help as well. Thus making it easier/possible to finance the build out.
Have a great weekend. I'm taking a break. Cheers
ps: The Big Lebowski is on of my favourite movies. Great handle you have.
Walter Sobchak: "Fxxx it, Dude, let's go bowling."
Same to you.
"An encouraging comment from Shawn Westcott (former IR manager at Quantum/Niocorp) that appeared in an InvestorIntel article about MDN...It's always good to hear from Shawn! "
Shawn is a gem. The most honest guy in the room. He cold called me and I got into QRE heavy at $0.12 CAD and up. Just gave me nothing but straight goods, ever. The good and the bad. Shit. He found many other key investors and even found Mark Smith. That was the beginning of unlocking value. We should all be grateful for the very hard work he did in the dark days of this company. If not for Shawn...nothing IMO. Too bad they parted ways. I am very loyal to him and proud to be.
My calculations show it was $645K cdn at a $0.258 average but its a great show off support. Hat's off to him. Wish I could get that deal.
It is by belief that it was required to cover bills, payroll, etc. while he is out looking for the money to get the FF done. Which seems to be $7 to $8MM US as per the management discussion.
I truly appreciate a CEO with that commitment. I sincerely mean that.
Do you really think it was because he had that cash burning a hole in his pocket and needed to add to his 17MM shares at this time? Really?
Note 3 on page 6 from lastest financials:
"working capital deficiency of $828,179 at March 31, 2015"
I am neither.
I hope the mine gets built because a lot of good people have money in this.
The financials were for March 31st, 2015. That is after the Mark interview saying they had enough money for 18 months.
Listen, almost every junior needs cash. It's not unusual.
Some believe that the funding has been accomplished to the FF. The MD&A says differently.
Some still believe the FF will be out in September. My guess is that we first see a financing (if they can pull on off)and a FF in 2016.
Go read their most recent financials on Sedar. Also read the MD&A.
Note that this is after they raised all the private placement money but before some wt. and now option money came in. They were in negative net cash - You will find this:
As noted above under “Exploration and evaluation assets”, the Company has completed the infill drilling
program and the Technical Report, and is currently completing the PEA. The next step in the work
program is the completion of the Feasibility Study. Management estimates that completion of the
Feasibility Study and ongoing project and operational activities will require funding of approximately US$7
- US$8 million through completion of the Feasibility Study.
As of March 31, 2014, the Company had a working capital deficit of $0.8 million compared to a working
capital surplus of $1.1 million as of June 30, 2014. From April 1, 2015 through May 15, 2015, the Company
received cash proceeds from the exercise of approximately 1.5 million warrants totaling $1.0 million. The
Company cannot predict the timing or amount of additional options and warrants that may be redeemed,
if any.
So they need cash.
OK game over due to lack of interest.
The answer is I have no idea. But I'd like to know. I read the last interim financials and management discussion so I have a clue. What I don't know is how many $0.65 cent warrants have been exercised. I exercised all mine. If all holders of those exercised them the company might be close to having enough cash now...or they might be hunting for $10 million. I guess we'll see. It should show up in the share count if they won't tell us. Haven't seen it reflected yet. Otherwise we wait 'til Sept for the year end report or we will hear about a financing.
www.sedar.com
is a useful resource.
I wonder if the new gal in IR could/would shed light on this....now that PD is gone I can't meet him on the corner for a cigarette to get a sense of what's up (not that he ever told me anything sensitive - he did not).
I thought I was crystal clear.
How much money does Nb need from here to progress to the point of being able to get a FF report done?
That is the next major milestone is it not?
Poll.
I do admire Mark for funding short term needs for Niocorp with his option exercise.
How much more money does NB need to raise before to be able to get to a FF report?
0
1 to 5 $MM
5 to 10 $mm
over 10 $mm
Wrong. Sorry for posting again. Just a factual correction.
De-jokering
Been through this several times before. It's a process of de-jokering. It seems that maybe 10% of the float or a bit more doesn't have vision or can't do deep due diligence. More likely they are so beat up they can't believe a stock they hold has bids. Just moving those blocks into real shareholder types is underway.
Thank you for that post. You did mention you believed that property has additional merits. Drilling will tell the tale on that. They have confirmed 300MM lbs of oxide? MIN has 5 billion lbs (only half or so recoverable). Let's hope a nice working relationship develops. One day someone might find the source porphyry.
In a perfect world Excelsior would be able to toll the SX-EW plant for the lower scale early day operations. That way they don't have to buy the environmental liabilities.
Cheers
Paul Gait, Senior Research Analyst
Copper commodity outlook
10,000 a tonne for 2017 (70% higher)
Open the slides as you listen.
http://www.naturalresourcesforum.com/index.php/paul-gait-bernstein/
Found this posted on Stockhouse - thanks Redmetal
MKT CAP 27.552MM NPV $820MM after tax. $1,250MM pre tax.
Recent activity seems that the mkt is awakening to this absurd anomaly.
My last post here
I truly hope this works out. Good luck to all.
Cheers
How do you determine what prices are real.
Well for one on the BNN GO link on the Niocorp homepage Mark said it was around $40/kg. But that is very easily searchable elsewhere and I agree with him. CBMM increasing capacity is as well.
As for Sc I think the numbers used by SCY are much more realistic and in my real belief, high. If we expect industry to adopt and specify Sc alloys I don't think $3500/kg is anywhere realistic. SCY is very well researched and fully committed to Sc. They have collaborations with Airbus. I own no SCY but it recently doubled and wish I did.
Anyhow, food for thought.
I like IRR's in the 40 - 50% plus range. Not 15% with suspect numbers.
The PEA changed things obviously. Mr. Market said so.
The IRR was very weak compared to other financible mining projects. NPV yawn. Cap Ex gasp. We all agree on that. The life of mine is very good giving the Elk Creek project a chance. Big money likes long lived mines. However, the PEA using commodity prices higher than the current prices for the said commodities doesn't give comfort. I'm actually very shocked at SRK for allowing it. They must have been under enormous pressure is all I can think of. Hence the delay?
I would like to know the IRR, NPV, EDITDA with prices that are real. Nb $40/kg and Sc 1500 to 2000/kg.
Fair enough?
ps - I've done the math.
Okay. Yay to Nb price assumption 20% higher than current for you. Not me. I want a robust project at a DISCOUNT to current prices. As do bankers. If any other commodity company came out with a PEA at prices 20% plus percent higher than current the street would first laugh and then kill them. I, at present, have zero position. But the idea of farmers sitting around the coffee shop that are not really equipped to assess risk/reward is, for some reason, capturing my attention. I'm just trying to be factual.
at 3cad I may be tempted to sell some
So at a dollar we have a 200MM fully diluted share float. At 3 dollars it is a $600MM company. And that is without financing the full feasibilty study or financing the mine development.
At $3.00 its a $600MM company with the need to find $900MM in equity and debt money for a $550MM NPV project that is based on using Nb prices 20% higher than the current market for it and SC prices 40% higher than other Sc mine development companies are using is quite optimistic.
CBMM is increasing capacity by 50% in 2016. That is 40% of world demand. Does that mean Nb prices should be 20% higher than the current $40/kg or, at best, the same?
http://www.worldconstructionnetwork.com/projects/cbmm-araxa-niobium-production-plant-expansion-minas-gerais/
http://www.bnamericas.com/news/metals/cbmm-to-spend-us430mn-to-expand-nobium-output-to-150000t-y
I would like to see the NPV, IRR, EBITDA at Nb $40/kg and Sc $2000/kg. It's nothing close to the PEA. That would be good info. and allow informed decisions.
Just saying....
until the formal PEA is available
Well please remember that a PEA has much wider latitude for guesses and assumptions by the engineers. SRK has a pretty good rep so it should be a quality document. A pre-fease is more definitive. A definitive fease is a document that is very thorough. Bankable. Well established mettalurgical data. Detailed engineering. It would almost assuredly show price sensitivities of the various commodities. So bankers, investors, etc, can see what the company would make at various commodity price assumptions.
I note that a lot of specialists in this sector are very much under water in most of their investments; Not me LPC.
It's LCP. Large CXXX Peter fyi. Makes it easy to remember.
Excellent!
I have had a great run as well. Counter to many of the suffering ones out there. I expect this year to be even better.
Cheers
Juniors are a thing onto themselves in the investment world. Comparing them to a big index fund or long term earnings grower is not based on anything approaching realism.
http://www.miningmarkets.ca/news/the-secret-to-making-money-in-junior-resource-stocks/1002075250/?&er=NA
Like with NB, would it not be prudent to sell at $0.65 and reload with a $0.55 unit that included a $0.65 wt? No brainer isn't it? - exactly double upside. I sure did and I'm grateful the mkt allowed that opportunity. I understand the hold for a homerun guys but in this realm it's not exactly what many, most investors that are experienced in this sector do. Maybe this one is a special case and we're all supergeniuses.
TIMING
Timing, the third and final critical component, measures the ebb and flow of money into the company’s treasury and into the stock. One feature of the evolutionary cycle associated with greenfields is a long dormant phase followed by a gradual upward movement as money is raised, surveying and sampling is completed and exploration starts. Then, if exciting results are announced, the buying frenzy drives prices into the stratosphere. From that point, since most discoveries don’t pan out, the stock painfully ratchets its way back down to dormancy near the lows and the cycle begins again.
Proper timing can make the difference between profit and loss. Long-term fundamental buy-and-hold philosophy should not be applied to junior stocks. Instead, predetermining the correct time to enter and exit the stock is critical.
Trading the dormant phase: For many investors, investing during the dormant phase, which can last for up to two decades, will prove to be the most challenging and most rewarding tactic. (THIS IS WHAT A LOT OF US DID AND IT SEEMED ENDLESS) This is the time for investors to accumulate shares and to trade them to reduce the cost of any remaining shares to zero. Within a dormant phase, stocks tend to fluctuate dramatically within a certain trading range. This oscillation pattern enables investors to trade the stock, realize profits and use those profits to accumulate more stock in anticipation of the dormant phase ending and a breakout occurring. It may be best to trade within an RRSP or TFSA so that tax concerns will not interfere with any decision to sell.
Trading the breakout phase: Most of the time, junior resource stocks drift around within the high and low parameters of the dormant zone. However, occasionally, good news flows at the right time and the stock breaks into new territory on extreme volume. Investors who have already traded out of the stock just below the breakout price should immediately buy back in. However, this new position should be sold within days as investors may anticipate a financing to be announced.
Money in the treasury: For a company, having money in the treasury is considered akin to having gas in the tank of a car: it is viewed as a requirement for movement. Many investors restrict themselves to investing in junior stocks that already have enough capital to finance a near-term exploration program, believing there is less uncertainty in such stocks. However, that belief is ubiquitous, largely discounted in the market, and rarely coincides with buying near a low. It is possible to make money at this stage, but the returns will generally not be as high. By the time sufficient funds have been raised, the price action on the stock becomes dependent on drill-hole assays. Investors at this level must compete with other like-minded shareholders for trading profits. At this point, the stock will be near the upper limit of its dormant-phase trading range and astute investors should have already recovered their initial investment. Instead, investors should focus on who is investing rather than how much has been raised. Promoters will normally position themselves well in advance of raising exploration funds. It is best to mimic what the promoters do.
Investors often try to time their buying to coincide with a bottom or anticipated near-term price movement. Yet, successful junior resource stock speculation is actually contrarian investing in the purest form. Therefore, it is critical that investors do not follow a conventional approach. Instead, first determine if the proper timing conditions have been met. Then, watch what the promoters are doing in order to confirm. A checklist will minimize the chance of allowing emotions to interfere with timing decisions. (See Table 3: Timing Checklist.)
TRADING
After qualifying a stock based on management, structure and timing, investors can further improve returns through a few simple trading techniques. Junior resource stock investors must use unconventional trading strategies that do not depend on the long-term success of the company. Instead, the strategies should be based upon the typical evolutionary cycle unique to junior resource stocks.
Greenfields spend most of the time in a dormant phase, where they exhibit tremendous volatility and opportunity for trading profits. Investors should look for stocks that tend to fluctuate 400% or more between the low and high ends of their dormant phase. Rather than trying to find the bottom, investors should buy into a stock through three purchases. After confirming using the timing checklist, invest only one third of the total amount intended. Only buy additional shares if the price falls another 30%, then invest the second third. If the price declines 50%, then invest the final third. This technique will properly position the investor to sell as the stock oscillates back up to the high of its dormant phase range. (See Table 4: MacDonald Mines chart)
When selling, investors should sell in two steps. First, recover all invested capital by selling one third at 300% above cost. The final two-thirds can be sold just below the upper range limit of the dormant phase. Some investors may decide to retain some shares for the long term in case a mine is discovered. If the stock subsequently breaks out, then reinvest for a few days using only the profits. The buy and sell points within a dormant phase are illustrated in the chart of MacDonald Mines Exploration (BMK-V). In 2005, this stock met all the criteria. The stock traded between 6¢ and 30¢ over four years and investors could have tripled their money twice. In the end, there was an opportunity for huge gains when the stock broke out and blasted off to $1.32 before drifting back down into dormancy.
That's just good $$ management in this sector. Nothing else to read into it.
Airbus Group
EADS Innovation Works is reviewing options for the materials Airbus could use on an airplane to replace the A320neo in 2022. The competition between metal and composites remains intense, prompting EADS IW boss Yann Barbaux to advise against betting on a full-composite airplane, now designated the A30X.
Speaking at a conference organized by the French Air and Space Academy in Paris, Barbaux explained that weight savings come at a less acceptable cost for a medium-haul airplane than on long-haul aircraft such as the A350. Removing a kilogram from an airframe saves more fuel on a long-distance flight, he added. Aluminum alloys, therefore, could prove more suitable than composites for the A30X’s thin parts, such as the fuselage. Thicker parts such as wings would more readily lend themselves to pricier, but lighter carbon-fiber reinforced plastics (CFRP).
In alloys, aluminum-magnesium-scandium has emerged as one candidate. “No copper means no corrosion,” Barbaux said. Challenges include scandium’s price and limited global availability.
http://www.ainonline.com/aviation-news/air-transport/2013-01-07/airbus-mulls-new-materials-a30x
http://www.technology-licensing.com/etl/int/en/What-we-offer/Technologies-for-licensing/Metallics-and-related-manufacturing-technologies/Scalmalloy.html
http://www.technology-licensing.com/etl/int/en/What-we-offer/Technologies-for-licensing/Metallics-and-related-manufacturing-technologies/Scalmalloy-RP.html
http://investorintel.com/rare-earth-intel/scandium-go-ahead-make-my-day/
Because they doubled. And are up over 10 times my entry. And because Seawolf deserves a chance at making some loot...
No other reason. I still have a modest home invested in NB. Don't misread my statement. I think a decent amount higher is within reason. With the Ti and Sc credits I could see a NPV of $2B. It would mean maybe 200% to 300% up from here.
There are much lower risk/reward deals out there. Excelsior Mining has a pre feas at $1.25b (after tax of $825MM)and has a mkt cap of shit. Enough cash to go to full fease. My next ten bagger. Make a note of it.
Pre feas is much more comprehensive than a PEA. PEA is like a finger in the air testing the breeze.
It just is what I do.
Many of you guys are bonkers.
Paying too much attention to a Preliminary FS is not sensible. It may or may not have Ti and Sc credits in it. Who cares - we have developed a deeper understanding of the opportunity. As a consultant I would have a problem with attributing $2000/kg for Sc credits. But that is exactly what SCY did in a PEA. We might see it in there or we might not. But we do know the Sc is there.
As for expecting the share price to go to the PEA value off the bat....be careful with that expectation. You don't need to look far for companies trading at enormous discounts to that number.
Management continues to deliver. I remain long but not as all in as recently.
God, its just good manners to save some profit for the next buyer. Do deep research, scale in your buying. Help add value. And scale out your selling. That is my MO.
Excelsior's second biggest backer other than management, Callinan recently got bigger:
http://www.callinan.com/s/news.asp?ReportID=699251
Hello, the loan was made by Arias who paid $30 million to buy shares at $2.80 less than 6 months ago (adding to their existing position). Can you read into this that they are endorsing and giving Mark Smith the tools to advance the project and get operation efficiencies achieved? Plus they gave Arias an option:
Pursuant to the bridge loan documents, the ARC funds will also be granted a participation option to
subscribe for up to an aggregate of $40-million of securities under any proposed offering of common
shares or securities exchangeable or convertible into common shares on or after the date of the loan
agreement. Under the participation right, in respect of any proposed equity offering, the ARC funds,
collectively, may subscribe for that number of securities having an aggregate purchase price equal to
the lesser of (a) the aggregate purchase price of all such securities; (b) $40-million; and (c) $40-million
less the aggregate purchase price of all securities previously acquired by the ARC funds pursuant to
the participation right. The participation right will be subject to the participation rights of parties
other than the ARC funds under the investor nomination rights and governance agreement among Largo,
the ARC funds and certain other parties.
I read that Arias didn't have faith in the outgoing CEO and will give Mark all he needs to make this work. NICE.