North River Share Discussion Threads

[yellowthroat] 26/9/2016 13:03

EXTRACT :


26 September 2016

North River Resources plc / Ticker: NRRP / Index: AIM / Sector: Mining

26 September 2016

North River Resources plc

('North River' or 'the Company')

Interim Results for the six months ended 30 June 2016

North River Resources plc, the AIM quoted resource company focused on the Namib Lead-Zinc Project ('Namib Project') in Namibia, is pleased to provide its unaudited interim results for the six months ended 30 June 2016.

Highlights:

-- North River continued in its efforts to secure a mining licence for the Namib Project. A Notice of Preparedness to Grant the Mining Licence was received from the Namibian Ministry of Mines and Energy ("Ministry") in January 2016, setting out a process and timeline for agreement on newly introduced licence conditions, and a formal proposal to address these conditions was submitted to the Ministry in late April 2016. The Ministry is yet to respond to this proposal.

-- The 3,800 metre drill programme continued to progress in the first half of the year, with a number of drill holes showing significant mineralisation. Overall results, however, have been mixed, with drill holes not intersecting mineralization to the extent anticipated, indicating that achieving a significant increase in defined mineral resource will require further work to improve understanding of the structural complexity of the orebody at depth. Since 30 June 2016, the programmed drilling metres have been completed in early September, and next steps will be defined following completion and assessment of final assays.

-- A loss before taxation reported for the 6 months to 30 June 2016 of GBP1,302,437 (30 June 2015: loss of GBP1,377,787).

Post period end:

-- A successful share capital reorganisation and US$ 5.6 million financing, including an open offer and placing, were completed in July 2016, allowing the Company to redeem outstanding convertible loan notes to Greenstone Resources LP. The financing left the Company effectively debt free and with US$2.5 million in working capital to support project work programmes in the second half of the year.

-- New appointments to the Board of Directors of wholly owned Namibian company, Namibia Lead Zinc and Mining (Pty) Ltd ("NLZM"), were announced on 26 August 2016. The appointments of Asser Kapere, Ratonda Kajivikua and Francois du Plessis will greatly strengthen the NLZM Board in its efforts to advance the mining licence application and take the Namib Project forward to a construction decision. Mr Kapere has been appointed as Chairman of the Board of Directors of NLZM.

-- The Company now faces a critical period of assessment in determining the way forward for the Namib Project. In regards to this assessment we are cognisant of both the prolonged, ongoing uncertainty regarding timing and terms to be attached to the grant of a mining licence, and the results of the resource expansion drilling programme.

Chairman's Statement

North River continued in the first half of 2016 to focus on advancing the Namib Lead Zinc Project in Namibia towards a construction decision. Against a backdrop of continued uncertainty surrounding the long outstanding mining licence application, the clear priorities in the period were to continue pushing for the grant of the licence, advancing the resource expansion drilling programme, and raising working capital to support these critical activities.

As shareholders are aware, a successful share capital reorganisation and US$ 5.6 million financing, including an open offer and placing, were completed in July 2016, allowing the Company to redeem outstanding convertible loan notes to Greenstone Resources LP and in so doing be left effectively debt free and with $2.5 million in working capital.

Regarding the Namib Project mining licence application, a Notice of Preparedness to Grant the Mining Licence was received from the Ministry in January 2016, setting out a process and timeline for agreement on newly introduced licence conditions. A formal proposal was submitted to the Ministry in late April 2016, addressing these conditions, by committing to: (i) providing an opportunity for local ownership of the Namib Project; (ii) participation by historically disadvantaged Namibians in the management of the Namib Project; and (iii) implementing a corporate social responsibility strategy.

As per the process set out in the Notice of Preparedness to Grant, the Ministry then had 30 days to review and respond to the Company on its proposal. The Ministry however informed NLZM on 2 June 2016, and then again on 3 August 2016, that it requires more time to review the submitted proposal. No revised date, or timeframe within which the Company can expect to receive a response, has been given by the Ministry. While the Company looks forward to continuing to work with the Ministry on agreeing the terms and conditions to the grant of the mining licence, the duration and outcome of these discussions remain uncertain and the final issue of the Mining Licence on commercially acceptable terms cannot be guaranteed.

The North River Board also continues to examine the implications of the Government of the Republic of Namibia's proposed introduction of broad based empowerment legislation. As previously announced, a first draft of the NEEEF Bill was published in February 2016 for a period of public consultation and can be found on the website of the Office of the Prime Minister (www.opm.gov.na/web/opm/neee-bill). Following an extended period of public consultation, a second draft of the NEEEF Bill is now under further review and stakeholder consultation. The second draft of the NEEEF Bill clarifies that the legislation would apply to both existing and new business but otherwise remains largely unchanged from the first draft. Indications from the Namibian Government suggest that this proposed legislation will go ahead and be enacted into law but timing remains uncertain. If enacted, the NEEEF Bill will set out obligations for companies, irrespective of sector, in respect of, inter alia, ownership and management participation by previously disadvantaged Namibians. Certain obligations under the draft Bill are inconsistent with those laid down under the terms & conditions to the Notice of Preparedness to Grant. The extent to which the NEEEF Bill would place additional obligations on the Namib Project remains unclear. It is an area on which the Company and Namibian mining industry as a whole will seek and need further clarity in due course.

The Company recently announced new appointments to the Board of Directors of wholly owned Namibian company, Namibia Lead Zinc and Mining (Pty) Ltd ("NLZM"). The appointments of Asser Kuveri Kapere, Ratonda Engelhardine Kajivikua and Francois du Plessis are aimed at strengthening the Board to support the Group's efforts to obtain the mining licence and take the Namib Project forward to a construction decision. Mr Kapere has been appointed as Chairman of NLZM.

North River is reporting a loss before taxation for the 6 months to 30 June 2016 of GBP1,302,437 (30 June 2015: loss of GBP1,377,787). The Company's cash position at the end of the period was GBP162,026 (30 June 2015: GBP602,093), before the net US$2.5 million working capital financing was completed in July 2016.

I would like to thank our shareholders for their continued support during what has been a difficult period for North River. The Company now faces a critical period of assessment in determining the way forward for the Namib Project. In regards to this assessment we are cognisant of both the prolonged, ongoing uncertainty regarding timing and terms to be attached to the grant of a mining licence, and the results of the resource expansion drilling programme.

Rod Beddows

Chairman

26 September 2016

[steve239] 22/9/2016 20:11

Thanks YT. All good information - but largely incidental while we wait endlessly in the hope of getting a bloody mining licence.

Speaking yesterday at the United Nations General Assembly in New York, Namibian President Hage Geingob was quoted as saying:

“We need to talk about inclusive growth that will translate into creation of decent job opportunities for our citizens. In other words, we must do more to move away from the current jobless growth model that prevails in many of our member countries and aim to grow our economy in a sustainable and inclusive manner in order to ensure that we effectively tackle the scourge of poverty.”

With this in mind, it absolutely beggars belief that a company like NRRP, offering the promise of employment to several hundred Namibians (as well as paying a sackful of tax to the local government), has already waited two and a half years for a licence, for no good reason, and is consequently in a desperate struggle to survive.

This was a country that was ranked 2nd in Africa and in the top 10 in the world for doing business. The sad reality is that it’s run by a bunch of incompetent bureaucrats and blighted by misguided trade unions who are obsessed with power to the locals, especially those of a particular skin colour.

If the proposed legislation goes ahead, businesses that can, will move elsewhere and the Namibian economy will be dead and buried; and all for the sake of enriching a small number of already successful black Namibians.

[yellowthroat] 22/9/2016 16:47

The main positives are below :

1. We know the project is economically favourable.
2. We know our main investor and the BOD are still confident and onboard.
3. We know we can get the licence and then have a profitable plant.
4. We know that ZINC is THE metal and that Silver is $20 & has positive profile.
5. Price of ZINC currently between $2100-2300.
6. We know we have the full plan with serious DFS to achieve serious metals production.

Negatives :

1. Haven't received the licence so cant be certain.
2. Billions of shares in issue that had to be consolidated.
3. No endgame still on licence or the rules.
4. Potential for "20percent for free" to NEEEF which seems a step too far for BOD.
5. Getting the remaining funding from sources EX-Greenstone.

---------

Short term is A : getting the licence and B : it being on sensible terms.

Long term still is fact that confidence in financing isn't yet fully restored.

---------

So whilst I agree that up till say Xmas I would group NRRP into complete basket cases, I would say that post Xmas, providing we havent expended too much in the way of cash... we would be well positioned to enhance value on any actual and full award.

I would also like to remind of :

1. ZINC still on upward trajectory and so is Silver.
2. We are supposed to be seeing more resource but perhaps slowed down on money and licence issues.
3. Lots of mainstream talk that China in particular are looking to invest in ZINC production outside of their country. Lots of mothballing of resources still being inacted which are helping the supply demand equation.

Finally there is a possible crackdown in dodgy capital spending particularly in shadow banking, this could be good or bad, the main thing in our favour is that it isn't a licence to print mine's money for unproductive Chinese sources of ZINC anymore.

I heard it mentioned that Chinese production was 'low hanging fruit' in the past and that it would be harder and more expensive to extract it down the line.

Just my take as we wait... ( and wait ) !

Regards

YT

[nufcrichard] 21/9/2016 14:53

Chablard, you might as well hold now, or at least only sell to offset some CGT, that's about the only thing NRRP are good for!

[yellowthroat] 19/9/2016 23:49

Oops my smiley face symbols came out as question marks. There's no chance of any happy signal here, feels appropriate! :(YT

[yellowthroat] 19/9/2016 23:47

Crunch I'm hoping they have a bit more than 'No idea' mate, however I get your point ! ?I'd be at them like a Rottweiler with a favourite soft toy ! ?YT

[crunch123] 19/9/2016 19:42

What can the company say other than "we've no idea when we might get the licence."
Will we get a licence before more cash is needed, or if not, will anyone be willing to take part in another fund raise?

[steve239] 19/9/2016 17:19

Worth a read: an article from the Namibian Sun newspaper, dated 14 September (5 days ago).

hxxp://www.namibiansun.com/news/hage-neeef-a-bad-idea

Following 120 separate objections, or alternative suggestions, made during the consultation process in July & August, apparently the Namibian President Hage Geingob recently stated that the NEEEF Bill was a “bad idea” and “not going to happen”.

Meanwhile the chairperson of the Law Reform Development Commission (LRDC), Yvonne Dausab, and the former permanent secretary of the Office of the Prime Minister, Andrew Ndishishi, said that the Bill “is unassailable and will be passed”.

Select an appropriate expression from the following list:

a) “Singing from the same hymn sheet”

b) “The left hand doesn’t know what the right hand is doing”

Wake me up again on 17 October so that we can all “celebrateR21; two and a half years since the mining licence application was received by the Ministry of Mines.

[yellowthroat] 28/8/2016 13:09

I had it that the second revision will be enacted in September time. As long as the '20% for Free' bit has been misinterpreted I assume we just accept various terms and conditions and just get on with it. The project should still throw off monies and we can continue to wrangle over exact terms.

In the meantime China in particular are all over the investment media stating that some of their big companies are looking for ZINC opportunities. I have been passing on alot of these announcements and newsfeeds to the company.

As far as I am concerned we should be attractive to partners or buyers whatever the situation, particularly if we get Chinese clout around negotiations and fairness to FDI.

Will our alleged Chinese partner here still ever show interest ! Rolls Eyes ...

PS : I therefore am hoping to not see anymore comments that we cannot market our company to interested parties other than onerous terms to our, admittedly IMO key and helpful partner Greenstone.

YT

[steve239] 26/8/2016 09:48

The three new directors of the NRRP subsidiary include two black Namibians who presumably come under the broad heading "previously disadvantaged" and therefore fit the bill in regard to proposed NEEEF legislation.

Asser Kapere ought to be a particularly useful addition, as a long-standing member of SWAPO (the governing party in Namibia) and Chairman of the National Council of Namibia.

[crunch123] 26/8/2016 07:16

Today's RNS - ministry still hasn't responded to licence proposal - "progressing"; extent of NEEEF obligations still unclear; some new management appointments (Namibians?).

The unintended consequences of the Namibian government policy seems destined to curtail future foreign inward investment/activity.

[crunch123] 16/8/2016 07:22

So what's the verdict?
Presumably the Ministry of Mines & Energy has decided that it can ignore the deadlines that it set for its response on licence applications? Has it shut up shop on issuing licences until NEEEF legislation is enacted?

[1mack] 12/8/2016 15:42

What is going on then NRRP?

Little RNS would be a good idea!

[crunch123] 11/8/2016 06:29

Mining Ministry has uploaded new licence list to its website (dated 9 August).
No change in respect of NR ie. ML not yet granted & the two EPL's still "pending renewal".

On the ML front cursory inspection suggests no licences granted since February.

There's a news story elsewhere, bemoaning the increase in Namibian government debt (+415% over the last six years).

Joined up thinking is needed.

[888icb] 11/8/2016 00:51

NRRP had a good day yesterday UP 16% and number 12 on the riser board. Let us hope this rise continues.

[1mack] 06/8/2016 08:39

I too was worried about greenstone, however they are in the same boat, i.e. chucking money at this, averaging down the best they can and hoping for a license.

They have a good team on their books, wouldnt be good for their status and reputation if this fails.

So feel they will do their best to make this work.

We didnt have much luck here with river,if we can ride out the poor commodity market, which it looks like were coming through and rise from the ashes....

Plenty of mines or projects to buy of the creditors.

Namib government need to wise up, fix their policy regime and hand the license out. Jobs = Spending = Growth.

Gla

[crunch123] 06/8/2016 06:05

Pinky, respect your decision.
If it weren't for greenstone NR would have ceased to exist a while ago - who else would have continued to stump up in the series of fund raisings during the interminable wait for the licence?
Greenstone must be as frustrated with the Namibian government & ministry as the rest of us.

[pinky37] 06/8/2016 04:04

Sold out of this a few weeks ago peoples. The only winners here will be greenstone. The company had demonstrated over a year ago that they were ready to start construction and nothing happened...welcome to Africa

[yellowthroat] 05/8/2016 00:55

Apart from licence, & yes that's a big one. A lot of other things have turned more reasonable recently.Namely Zinc, Silver & supply / demand that was envisaged. Probably should have looked for a Zinc ETF !Also the point about big companies looking for supply & expo potential meaning Phase Two might not be quite as bad as originally thought?Bloody license is killer but agree gamble at these levels is really game on !Market on AIM seems to hate vacuum & maybe stock goes down on MMs on some sort of short ?Dangerous though on potential for sentiment to change on JORC & license as we know!YT

[1mack] 04/8/2016 21:47

Good post Steve.

RNS in the morning? I love a Friday RNS...

I like many of us, have little funds left to buy shares in NRRP, however I got another 3000 this morning and have been putting what I can.

Few solid buys and this will shoot back up.

We are dangling on a knife edge, however if were going to go down, at least we can say we kept faith and a board whereby there is no bad blood or pointless arguments.

GLA