Andrada Mining acquisition elevates the miner to emerging mid-tier status. Watch the video here.
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Whats the outlook FAR for 2022 2023?
Imo its an exciting 12 months ahead:
- Nickel processing to come online late Q3 / early Q4 22 and FAR have stockpiled Nickel in preparation
- Further drilling results
- Commercial negotiations for sale of the black carbon used in high quality tyres
- Most notable is the results of the feasibility study expected middle of 23 which was delayed because scope was expanded so much
Company not yet operational in core purpose yet claim to be profitable already as a result of the side products like carbon.
In my view, feasibility study is what will either kill this share or take it much higher. Signals are positive but no guarantees at all.
As ever, DYOR! I'm interested in other's views on it & happy to be corrected if i've misstated any of the above!
From what I have seen I thought NB is fairly sure, perhaps more than fairly sure, the material is present in the ground. The feasibility study gives a Jorc standard which means what they think is there is actually there. Please correct me if I'm wrong.
This is only what I think. I have no knowledge about exploration stuff.
Regards RRJ
DYOR
Yeah agree, believe they have a formal study completed to Kazakh level so they know whats there but the study that is pending is to be signed off to confirm that the material meets European requirements to be formally acknowledged.
NB has history of talking up opportunities (not just with FAR) for example rare earth materials was expected to hugely contribute to the company’s revenue but has been knocked on the head. I have detailed some current pros and cons of the stock: Pros – 1) Vanadium resource is there and it is very likely this will be confirmed in the drilling results next year. 2) Infrastructure is there (requiring low capital expenditure for a mining project). 3) Skilled workforce are in place. 4) Operating costs are extremely low, based on the type of resource being mined (by products will help this cost reduction further – I see the by-product as a potential risk now as the expectation was there was significant viable by-products). Cons – 1) The company is currently loss making and will require an injection of capital (I estimate share dilution will take place in the next 4 months). 2) Carbon Black substitute will require collaboration with numerous potential customers which need to trial the product which isn’t proven (this is a big uncertainty but obviously if successful will be hugely beneficial to FAR). 3) Directors still holding large volumes of stock (Christopher Thomas purchased circa £160k on 15th March 2021 at an average price of 14p)
For transparency I sold my position a few months ago and now have a large short position which has been open at 16.5p. I will look to reverse my trade when the share dilution takes place (my estimate is around October/November). With the hope that the new injection of funding will help push the company to be more efficient in their operations and produce positive free cash flow by mid 2023. If FAR manages to produce free cash flow of anything over $7million then funding for the larger plant will proceed on favourable terms to shareholders. I believe that if Sir Mick Davies goes ahead with the phase 2 mine then NB and A Kuznetsov will be replaced in 2024.
I haven’t mentioned any macro events that are a potential risk, such as recession, political risk and Vanadium price etc. But with the extra funding being used wisely, FAR should be able to weather any recessionary downturn, with the expectation that we will be out of recession in 2023.
Van2000 is short here? Didn't know you could short a company this small. About the share capital, is that the 2.6M or so vision blue has left to acquire? Think I remember the plan was for them to excercise the rest of the 9p warrants when there wasn't a need to do a new prospectus....
I do also believe the company is profitable and able to fund the studies without a cash injection but live in hope that it speeds things along a bit. If we're lucky it will although the company doesn't seem in a rush for it.
The last RNS clearly stated the company is now profitable
IMHO the current SP reflects contagion from Russia and Ukraine. And Ukraine is moving away from Russia:
https://www.wsj.com/amp/articles/russia-ukraine-kazakhstan-central-asia-11658439761