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Theorist
Its extraordinary for you to expect Pensana was going to be named for a grant at Saltend for a mere $35M in a budget speech. Nobody wrote on hear of an expectation beforehand. The Teeside wind farm deal was £107M which was just above the £100M cut off as just about everything I heard was higher than that.
The scrubland in Angola which you put just to offend and provoke investors has an in the ground value as a resource and we have gone over this many times. It equates to around 48p a share (September 2020 RRE prices) and that was the price or near about AWF paid for their 21.6% share holding (when taking dilution from placings is taking into account). The resource to reserve valuation is likely to add much further on that value. The company has its own MREC methodology and has planning approval for Saltend also has a tangible value. The COOLA site is to have its resources added and these include other REOs in higher concentrations that are desperately needed by the electronics industry . The COOLA resource when reported adds 16p or so to the share price for in the ground value. The placing in June gave a valuation of 120p and dismissing it out of hand is rejecting all the design work, logistic planning and all the preliminary ground works both in Angola and Saltend. These developments I have seen in other stocks typical double the share price over resource that again supports the June 2021 placing value. Finally rare earth prices have doubled since September 2020 and that can not be ignored either.
My comment about GE has hit a nerve and anyone looking into it can see why they might be doing a lot of talking with Pensana. Perhaps it an off take or maybe they would want to secure something a lot more.
here instead of hear in previous
TT, anyone ignoring the potential for PRE and the need for western controlled neodymium resources, not to mention the present and future needs of the EV and Wind power is risking missing the boat here. I definitely missed the 70p price a while back and regretted not jumping in at 100p, but today I moved 80% of my portfolio to Pensana at 104p. Staying long term now and happy with the drop.
Thank you for your posts.
ST
ST
Great to have you in here.
Tony
Hi Tony, Just an observation ~ You mentioned a value for LJ of 48p (Sept 2020), and that prices have now doubled. However I am not sure what you mean by value ? FV, EPS (pa) or EBIT ?
In the PFS the Concentrate was valued at $3821/tc with a production costs at $1323/tc, for a Margin of ~ US$2,500/tc,
The mine was scheduled to produce 56k/tc.pa with an indicated EBITDA of $150M/pa. which at 49p/share agrees with your 48p/share
Now, If we now use the current SMM price for 45%RE-Concentrate ( US$8,052/t ), and remembering ~ that the difference ie US$4231 is now all profit (as the cost of production is taken care of in the original $1323).
So 56kt x $4231 = $230M (GBP 168) or around an additional 76p per share, x 85% (Pre share) = 65p
Add that to your 48p and we get an EBIT of 113p/pa ! once a PE is added we are well on the way to GBP15/share
Anyhow this discussion is basically immaterial; as we won't be selling our concentrate to the Chinese at US$8,000 or even 10,000/t , it will be going to Saltend where once refined the 4,000t NdPr will be worth upwards of US$100,000/t and the other 8,000t of TREO could add up to a further US$43,000/t (Assuming it meets the SMM spec)
Chinasyndrome
My 48p comment was on a different model of resources in the ground in Angola back in September 2020 which used a methodology that I apply on exploratory miners on pre-production. Basically so called scrubland has material value in the REOs it contains on JORC criteria before any mining infrastructure is built. The company had increased its value through exploration by 230% and gave us 48p a share or so and AWF bought its slice of the company. Tony
Cheers, I was wondering on how you came up with that.
Not sure how applicable it is but I am aware of several Gold prospects found by junior exploration companies and then sold to the big boys to develop, Usually they were given an option of a 10% Royalty on revenue or a lump sum of 5% on the In-situ JORC Resource value. Most took the 5% to give themselves Operating Capital !
Theo AHK - probably been overlooked for promotion as a result of his childish behaviour. In for a penny and all that.