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Savannah Res. Share Discussion Threads
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|GEd5, I live in the NW (of England).|
Series of copper joint venture, community meetings plus #SAV board meeting this week in Muscat and Sohar in #Oman - SAV building momentum.
It could be a very interesting Investor Evening on Tuesday!|
|I found the table showing the Lithium Oxide grades of the 5 companies quite interesting. The 1.29% grade at Erajarvi compares favourably with most of them. Admittedly this was an initial assay result compared to resources but it does show that we could have an economical project with the potential to become a world class resource.
It also shows that SAV's timing is spot on.
"LG Chem last year completed construction of an electric-vehicle battery plant in Nanjing, China, with capacity to supply batteries for 50,000 high-performance electric cars annually. Meanwhile Panasonic and Boston-Power have recently expanded operations in China to produce more battery capacity for the Asian markets.
China alone expects to have 5 million electric cars on its streets by 2020, and that will require an immense amount of lithium among many other key elements including graphite and cobalt."
For those interested this page on Albemarle website has a World map of Lithium deposits.
Do any SAV investors live in the North West?|
|This was in the RNS from KOD this morning:-
"Assay results up to 2.04% Li2O returned for sampling at the Sogola pegmatite vein located within Bougouni.
· New areas of high-grade lithium mineralisation identified within Bougouni with assay results up 1.9% Li2O and 1.65% Li2O."
Compare that with SAV's initial results from Somero.
"Somero Project has prospective pegmatites up to 1,200m long and 50m wide with an initial rockchip assay of 4% lithium oxide ('Li2O')"
Also looking through the KOD thread I noticed Euclid posted this:-
|good to be on the 6p support line again and as part of the new 6-8p trading range.
All in the main chart above !!|
|Last Wednesday the share price reached the predicted high for this leg and the RSI touched 100 (overbought). There were several small sells that day and the following Thursday.
On the Friday I suspect that most were aware that news could arrive early the following week and so some started buying back. IMO that's where the whoosh came from.
25 Nov '16 - 13:29 - 2501 of 2505 0 0
haha. Not sure where the sudden whoosh has come from today but I'll take it!
In less than two weeks I suspect there will be an updated presentation which hopefully will include new data from Finland and Oman.
There are still unknowns about Finland but if further assay results match the initial result it would be extremely good news.
All news from Oman seems to get better each time and I suspect those attending the Investor Evening will find out how well the October presentation went.
From a chart perspective, the 50% retrace from recent highs which happened today was most welcome. And it no longer looks overbought|
|Nice Oman RNS this morning and not one of the expected ones either.
Copper also this a.m continuing its northwards march too !!|
|Clearly some enthusiastic buyers here, let's hope it can get up to previous highs.|
|haha. Not sure where the sudden whoosh has come from today but I'll take it!|
|next leg up - here we come !!!!
"you don't want to be out of these over the weekend" :-)|
|You guys ought to look at the last few posts at COPL. Spudding soon and could have an extra 2 free drills carried by EXXON. COPL already have two free drills in the pipeline one of which is spudding in the next week... game changer!|
|Daily Telegraph today (Questor share tips): HOLD Pagegroup; BUY Savannah Resources for speculative purpose; BUY Wm Morrison.|
|very good Dubby :-)|
|A nice rise today, but...............https://www.youtube.com/watch?v=g9S93bE06H0|
|May have a drink myself seagull. Nicely up on this now, 100% +|
|Lift off !!!
may have a beer or three tonight|
|A NICE SUMMARY FOR NEW/CURRENT INVESTORS (COURTESY OF TRISSE ON THE OTHER BOARD)
SAV update – where do we stand?
After the last 2 big RNSs (oman & moz), it might be worth updating my thoughts:
1/ Corporate level
From a holistic point of view, David Archer has delivered very well. He has stuck to his timing indications and has participated in the last raise at 3.5p (first time he put his money in since the original effective takeover in Aug2013). He has also built a strong investor base that helps support the stock better than with PIs only. As we have discovered, the Omani investors are very influential and will likely play a key part in securing mining license approvals and financing for the Copper project and, who knows, the Moz project (remember Oman’s state general reserve fund has invested $ 100mln in Kenmare a few months ago). While the financing stage is still approx 9 months away, let’s not underestimate what it means to have relatively easy access to funding (might be state entity or commercial bank in Oman or midsize PE firm attracted to great IRR/payback economics). A lot of companies have large and decent projects in the ground but their capex needs are usually large and their access to such pools of financing is often non-existent… hence their mcap being generally 0-5% of the project NPVs).
2/ Oman Copper
The grades mentioned in the last drilling RNS were genuinely amazing. I invite you to check other drill results’ RNS from other copper explorer/producers and you will rarely see those numbers (dozens of meters at high single-digit %). The one company that has better grades is Sandfire, listed in Australia and their mcap is approx 1bn (admittedly already producing and bigger size). But it’s very instructive to see the economics of their project. At high grades, you get amazing economics. If you look at other copper explorer/developers on AIM, they might already be at DFS stage but the economics and grades are nowhere near what SAV will be. So we need to wait for the JORC and scoping study to have a first glance at the economics. My estimate is that the size of the JORC will be within the range they have already mentioned (10.7mn-29.2mn tones of ore) but at much better grades (1.4%-2.5% announced, likely to be on the high side). If it is the case, the NPV can easily be worth 25p/share net to SAV. (happy to go thru my calcs in a separate message if you care). David Archer and Dale Ferguson seem to be obsessed with low-cost operations, and while it means they focus on smaller size operations, it makes the projects much easier to finance and closer to reality. Again, too early to say, but it seems to me the Omani investors will be tremendous help in securing (ideally debt-only) financing at attractive terms (MDO, reserve fund, commercial bank…).
3/ Moz HMS
Today’s RNS is much bigger than I expected. Rio never published a JORC on their asset because they didn’t need to (when you are a big guy, you don’t need external project financing so you don’t need to immediately publish standardized information to the public). So SAV did it and it is big and legit (JORC compliant). Today’s JORC makes it one of the largest HMS resources in the world (ands that only a third or half of the total size they have). Now, in typical DA/DF fashion, they care about the economics more than the size. So they mention (in line with previous statements) that they will focus their scoping study on approx 200mT with highest grades. What can we expect? Here I invite you to look at Base Resources. It is a very clean HMS producer with a similar project in Kenya. Their resource was 146mn tonnes at 4.9% THM. But their production is focusing on the highest grades first to pay down debt ASAP and their producing grades is currently around 7-9% !!. This is key information. I personally think it is likely our scoping study on approx 200mnt (note bigger than Base entire resource) will be focused on grades in high single-digits. And based on BASE’ quarterly production reports, I extrapolate an NPV for SAV (at 51%) of approx 33p/share. Again happy to share the calcs if you want. And that’s only for the 200mnt initial focus. Note Base current enterprise value GBP 215mn. SAV is GBP 20mln.
So all in all, while we definitely need to wait for scoping studies (only a few months away for both) to get a clear and less speculative idea of the economic value of those projects, the info to date and comparisons to existing similar companies is extremely impressive. Respectable mining broker RFC is close to SAV (and they cover Base resources). They will no doubt highlight all of this to their instit clients in the UK and abroad. I suspect scoping studies is when the instit will be able to justify to their investment committees to invest and this will be a game changer. For now, this is an opportunity for PIs to invest at a great entry point. Once scoping studies are out, I personally target a share price of approx 25p (50% risk applied to initial NPV sum of both projects) with big upside longer term.
(note I have not mentioned Lithium/finland. While the outlook for Lithium is strong, I think it is currently irrelevant to SAV relative to copper/HMS projects).|
|Excellent start to the week!|
|If your wondering why results from Finland are delayed try reading this:-
First prize if your eyes don't glaze over!|
|Yep, 6 a bit of a milestone of recent times, but should be multiples of this in a couple of years.
Scoping study with some financial indications of cash flow will help set out what this company could really be worth.|
|Light the blue touch paper and stand well back. Always good to see a bit of pressure being relieved with a sudden rise, but this is just a small part of the journey to my mind.|
|Well 6p bid was achieved. Too tempting for some!
With the expected newsflow I still think this has further to go. Let's see what happens now!|
|Steady progress again this morning, next stop 6p hopefully.|