Premier African Minerals Share Discussion Threads

[edgein] 13/6/2017 08:31

Vitec,

Yeah looks like it, but once they clear and once people recognise there's more than just a producing tungsten mine here it'll fly. $bns of lithium free in then price here as well as the potash asset. Crazy caps and opportunities rarely last forever. I hope they prove it up 3-4 times larger as planned with the current ongoing drilling and sell it for several hundred million $. I'm sure the Japanese or Chinese would like another perhaps 1.5-2Mt of contained lithium for a fraction, perhaps $300-400m that would still give them $13.5-$18bn of contained metal to work with at pretty good grades. That's providing the lithium price doesn't improve further.

Regards,
Ed.

[vitec] 13/6/2017 08:24

There is still a seller about. To many 1m and 2m sells going through to think anything else.

[mike_f] 13/6/2017 08:11

Nice 3.9M buy over ask @.51p! More of the same please, then goodbye seller. GLA

[1madmarky] 12/6/2017 19:32

Oh yeah the lse board been on melt down for a while now

[billthebank] 12/6/2017 16:03

Cheers lMadmarkey.Helpful.Appreciate that.Saved me a lot of trawling

[1madmarky] 12/6/2017 14:13

Think noble are in the smelly stuff. I did mailed the info@premier blar blar blar and got a reply a half hour later. Basically stating that they are not aware of any issues that will affect payment for the tungsten they are fully insured against losses. Also that they have other interested parties and that any new contract would be on better terms for us than the current contract.
Think it's more a case of panic because we have not had confirmation of payment yet. This panic is because prem screwed up last time so everyone wants reassurance this time. Not unreasonable as far as I'm concerned. Also of course we are drilling holes like rabbits on speed so that must be costing money, hence money from tungsten would be good right now,

[billthebank] 12/6/2017 13:27

saw some banter on lse 're Noble.Anyone precis what that's all about?

[billthebank] 12/6/2017 13:18

what do others think on the possibility that afmine are selling there shares cos of cash flow?

[mike_f] 12/6/2017 11:00

The seller will be flushed out soon if the volumes remain the same then onwards and upwards. GLA

[nash81] 11/6/2017 15:16

time to buy back in.

news on RHA anytime soon

[tedoby2] 09/6/2017 16:06

Thanks Mike.

I think the photo's of the transport are very interesting. Not seen any of the transport before.

I also think it's strangely ironic in some ways that we're trading in the lightest metal in the world - Lithium @ a density of just 0.53 gm/cubic centimeter at Zulu and at the other end of the spectrum we have tungsten @ 19.3 gm/ cubic centimeter - almost 40 x heavier at RHA.

Deliveries of the Wolframite are being made using 20 tonne capacity lorries having an axle load less than 40 tonnes as I understand it. So not too many of those timber pallets per load at RHA if you please! "lol"

Just as their considerable difference in densities both RHA and Zulu will prove to be great assets I believe in the fullness of time for strikingly different reasons too. RHA as a cash cow and Zulu incredibly valuable.

We'll see.

GLA

[mike_f] 09/6/2017 15:21

New pics on website:



Loaded up and ready to go!

[mike_f] 09/6/2017 15:08

Buy price is increasing again, perhaps the seller has been exhausted as they seem to have eased up. A nice blue end to the week would be most pleasant :)

[vitec] 09/6/2017 09:49

Mike I am also baffled. Until the seller goes making progress is going to be difficult. I have given up trying to analayse it and am just sitting back waiting for the day I can have a permanent smile on my face. If we got to one tenth of the suggested 40p valuation I would be happy. I think that a suggested valuation of 40p per share with say 9 billion in issue is fanciful. I am not saying its not possible but from where we are to where this would be is millions of miles apart. Having said that every small company has had to start somewhere so why could it not happen to PREM. Considering the election night we have just had the market seems to be coping well. The FTSE 250 is taking a hit.

[billthebank] 09/6/2017 09:42

I reckon it is afmine. Could be wrong as they received their shares at 0.7p so surprised to see it but maybe they have some cashflow issues and need the readies. Who knows!!!! Maybe George knows?

[mike_f] 09/6/2017 08:51

Who is still selling?? Baffled

[ihavenoclue] 08/6/2017 16:09

tedoby2 .... nice post :)

[mike_f] 08/6/2017 15:25

If we can hold this gain today, it's one hell of a bullish signal on the chart if my limited charting knowledge is correct.

[thehitman1] 08/6/2017 15:14

Add a few more this morning.

[highly geared] 08/6/2017 15:13

Echo that,superb rational informative post.

[mike_f] 08/6/2017 14:57

Fantastic post tedoby2, thank you very much for sharing your calcs and thoughts. The future is certainly bright!

[ianbag] 08/6/2017 14:51

Big change in daily volumes since Tuesday so something is cooking here

[tedoby2] 08/6/2017 14:49

I for one was very pleased with the Zulu RNS we had on Tuesday. Both in quality and content.

I also think it's not a bad idea to imagine where Zulu might get us to in say 3 years time if we develop a mine alone. That way we can best assess the JV or buyout offers which are undoubtedly awaiting.

In my minds eye we have been given a very comprehensive assessment of just 1200m of the initial 3500m strike. However we know that the overall strikes to be assessed are currently at least double that at 7000m although that has every chance of increasing even more in my view.

Based upon the containing ore having a specific gravity of around 2.5 we can see the quantity analysed was around 8m cu m to give 20.1m tonnes ( 8m x 2.5 } . That fits given we've previously been told the initial strike indicates it's approximately 33m wide and around 200m deep. ( 1200 x 33 x 200 = 8m approx)

I was pleasantly surprised to hear the average grade was over 1% at 1.06%. As we're told the conversion from Li2O to LCE is 2.473. From that we get 20.1m x 1.06% x 2.473 to give us our 526kt's of LCE. The "in ground" value of that @$13k/t is therefore $6.84bn or £5.28bn at the current exchange rate.

To count the Tantalum the RNS tells us we have 1025 tonnes within the 20.1m tonnes of ore. So with the current Tantalum price of just over $123k/t we have an "in ground" value of 1.025 x $123130 = $126.2m or £97.8m for the metal.

Collectively then we have close to $7bn "in ground" value for Li2O & Ta2O5 in just the 1200m scoped out of the initial 3500m strike which we know is around half of that currently identified. .

To look at the cost of mining there no better way than to compare Prem against it's piers and in my view there's none better than Pilbara Minerals .It's similar to Prem in many ways and has been studied by several leading Analysts to date.

Pilbaras initial mining plan as noted in their DFS was to develop a mine capable of processing 2m tonnes of ore per year ( conveniently 10% of Prems MRS for ease of maths). However they have now changed that to increase production to 4mtpa no doubt seeing the economy of scale to take advantage of the present market and outlook. Pilbaras pre-production Capex was $214m to build their mine and that's a very useful guide for us too. Pilbaras annual Opex from their DFS is $190/t of concentrate produced so approximately $62m

In Prems case and in my view we should assume an 80% metallurgical recovery for Lithium and around 65% metallurgical recovery for Tantalum. Based upon a 2mt/pa run rate that would produce an annual "mined value" at current prices of $6.84bn x 80% x 10% for Lithium and $126m x 65% x 10% for Tantalum. Giving us a revenue for the two of $547m + $8m = $555mpa. With costs at say $100mpa we could be looking at around $450m PBT.

Taking the $62m/annum Opex for an open pit mine from Pilbaras data and increasing it slightly to cover perhaps an extra cost for a higher strip ratio from the apparent physical profile of Prems resource I believe we could be looking at more like $80mpa to $100mpa.

Funding the Capex required is sure to be a mix of equity and debt along with the liquidation of current assets such as Circum and revenue from income streams such as RHA. Pilbaras non bank debt contribution to their Capex is in the region of $60m and if Prems is similar its not difficult to see that an equity raise of around 4bn shares at say 1.5p or 2p would give us the equity contribution towards Capex needed to fund the development. I can see the benefit of consolidation in order to attract institutional investment at some point down the line too.

If the above calculations are about right we're looking at an EPS from Zulu in operation of around 5cts assuming we have 9bn shares in issue. With a LOM of near 50 years at 2mtpa throughput we should easily get a price/earnings ratio of at least 10 which would give us a share price of circa $0.50. At today's exchange that's a share price of just about 40p.

Clearly if we are able to follow Pilbaras' economy of scale philosophy and increase throughput the share price could be much more as the LOM is likely to be long enough so as not to affect the ratios I've mentioned.

In my view as I say the "go it alone" possibility we have strengthens our position in any JV or takeover discussions and therefore shouldn't be discounted.

Just one of my personal perspectives though I've no doubt some will disagree.

GLA