All Active Asset Capital Share Discussion Threads

[jonwig] 23/8/2005 06:55

Gull, yes, it puzzled me. Note the up-move at 2:30pm as soon as Toronto opened. I don't think this sort of thing is an 'arbitrage' opportunity, the spread is usually too wide.

[the gull] 22/8/2005 22:03

Still cant quite work out why the price opened a tad down this am after what reads to be on the possitve side? Got just a few anyway to tuck away.

[rambutan2] 22/8/2005 09:40

good. all heading in the right direction... 'We now expect to finalise an ESIA meeting Equator Principles and World Bank guidelines by December this year, which is a requirement of any potential lender. Kolwezi is that rarity among mining projects - one that actually helps to rehabilitate its surrounding environment as it will clean up a seriously degraded area, including a local water course. The project is also expected to have very positive economic and social impacts upon both the Kolwezi region and DRC as a whole.'

[jonwig] 22/8/2005 07:43

Approval for Kolwezi go-ahead (link to full announcement in header): LONDON, U.K. (August 22, 2005) -- Adastra Minerals Inc. ('Adastra' or 'the Company') today announced that its subsidiary Kingamyambo Musonoi Tailings Sarl ('KMT'), which owns 100% of the Kolwezi Cobalt and Copper Tailings Deposit ('Kolwezi' or 'the Project'), has received approval from the Ministry of Mines' Direction chargee de la Protection de L'Environnement Minier ('DPEM') in the Democratic Republic of Congo ('DRC') of the Environmental Adjustment Plan ('EAP ') relating to the Project. Also positive account of business/resources atmosphere in DRC: The DRC shows all the signs of emerging from the decades of strife and pillage that ruined its economy, infrastructure and social structures. In this, it is not unlike a number of other African nation states, but it differs from many in the sheer magnitude of its mineral potential. The prospective rewards could well more than compensate for non-economic risks that have been and that are steadily diminishing. Full article: http://www.mineweb.net/columns/african_renaissance/474588.htm

[mr ashley james] 17/8/2005 09:00

Rambutan, Still researching into how LSE:AAA intend to use flotation to treat sulphide ore previously treated tailings to create a concentrate on the Kolwezi Tailings, ie how the planned treatment plant is meant to operate, so have still not taken a position yet. Will update you on progress. Cheers Ash:)

[mr ashley james] 14/8/2005 02:48

Rambutan, Did Well on Southern Era Resources Limited then TSE:SUF in 2000 to 2002, mainly as a result of Messina Limited, ie the Messina Platinum Mine, then JSE:MES no 1 winner on JSE in 2000, but not entirely convinced on how the ENDIAMA, Lev Leviev and SRE minority 26% pans out or Chris Jennings etc ability to play or anybody for that matter's ability to play the De Beers, CSO, Alarosa Cartel. Diamonds are something I am beginning to look at in detail, having said which I am not entirely convinced seeing Synthetic Diamonds selling by the bucketload up to 3 Carats in Malaysia in 2000/2001 or the mark up of 50 times from original stones uncut to finished gems is entirely likely to stay in the same Oligopoly Status enjoyed for roughly 100 years plus. So commercial more competitive Diamonds I think a reality, afterall many other gemstones now competing on the Global Stage? As to SRE, not sure to be honest, just not sure, whilst undoubtedly Angola is one of the best places to find quality gems, can Chris Jennings deliver? Diamonds hmm 36,000 Known Kimberlites 60 produce Commercial Diamond Yields but are they really that rare when people produce large quantities on a commercial pipe discovery refer Winspear or with the synthetic Diamond Market encroachments on Margins in the growth Asian markets? Logically I can see Diamonds coming down to 40% of current prices over the next five years, even then healthy margins but is it the right sector to play, just not sure. Oddly enough I think Tanzanite 1000 times rarer than Diamonds might be a better place to play the Monopoly Game refer LSE:TNZ All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[rambutan2] 14/8/2005 02:35

am always glad for your company and opinions ash. my other drc play is sre/sdm - they got some prime land although not a very successfull history as yet, hence mkt cap. however, perhaps things are finally turning for them with recent angola announcement. they certainly offer plenty of bangs for the bucks. any views?

[mr ashley james] 14/8/2005 02:16

Rambutan, Somebody who I am interested to see whether invests in RDC, may well I guess not have read the 1998 Bechtel Report on RDC Natural Resources, which I saw said there are well in excess of US$160 Billion worth of Natural Resources in the Democratic Republic Of Congo formerly known as Zaire. So with Natural Resources as the key issue this Century, and the richest Deposits on Earth left In Democratic Republic Of The Congo? Where else? Afterall I see DRC as the next USSR/FSU Natural Resources investment Opportunity. Watching CHEVRON TEXACO, AGIP, ELF TOTAL scooping billions of Dollars out of Cabinda every year I doubt most people are right, and as ever reality is a place somewhere else for most of humanity living in Cloud Cookoo Land. They said I was mad going into Russia/FSU, now no doubt they say I am barking mad investing in RDC, so it goes. I very much doubt the Rothschilds miss too many major investment opportunities even if I think they are utterly wrong on Northern Dynasty Minerals Limited TSE:NDM All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[rambutan2] 14/8/2005 01:50

re adastra's stake in kolwezi... http://www.companyannouncements.net/cgi-bin/articles/200505160700083141m.html

[rambutan2] 14/8/2005 00:48

yes, im here. waiting. have absolutely no doubt that aaa has exceptional potential. so, it all comes down to the completion of the funding, and that is out of my hands so to speak. would prefer the share price not to have drifted back down again as mr read has left me with the impression that no dos at these levels as too dilutive. but, not worried as the share volatile. i did spot that legendary deep value investor peter cundhill has got a holding in one of his funds. ash, i havent kept the header completely up to date and there are prob a few worthwhile links posted through the thread.

[rambutan2] 14/8/2005 00:29

who's roland then ash?

[mr ashley james] 13/8/2005 21:54

Roland, I am going to need to do some complex sums on valuing their resources and discounting by US$316,000,000 Project Finance at no Doubt Standard Bank Levels of Interest and CAPEX Repayment, ie up to 550 Base Points above LIBOR I guess, I might be able to come down to 250 Base Points, but somewhere around 4.50% plus 2.50% to 5.50% has got to be realistic for RDC ie 7.00% to 10.00% logical average 8.50% pa best case. The next question is should I work on 10 Years I can not possibly see 38 Year Loans to Congo, so can I stretch it to 15 years? Work to do next week, think this is worth the effort personally the scale for number crunching as ever:- There is a report issued by Mining Business Digest in 2000, with an article actually listing the values paid for mining deals worldwide in The Mining Journal 15th December 2000, which sumarises ore reserve acquisition costs by North American companies during the 1990's. A Decade of Deals analysed 429 transactions (including 314 gold, 45 copper and 34 gold-copper deals), the numbers make interesting reading:- END-1999 GOLD PROPERTY ACQUISITION COSTS (US$/OZ) ------------------------------------------PROPERTY TYPE--------------------- --------------------------Exploration-Development-Production-Corporate Normal Expected Lower Limit--US$ 3------US$ 20------US$ 45------US$ 70 Expected Average-------------US$ 7------US$ 33------US$ 60------US$ 80 Normal Upper Limit-----------US$10------US$ 40------US$ 75------US$100 Lower-% of price*------------1.0%--------6.9%-------15.6%-------24.2% Average-% of price-----------2.4%-------11.4%-------20.8%-------27.7% Upper-% of price-------------3.5%-------13.8%-------26.0%-------34.6% Note Upper and lower limits are for an "average" acquisition, and are often exceeded for various reasons. Source:Mining Business Digest. *End-1999 price of US$289/oz. This is the equivalent table for Copper:- END-1999 COPPER PROPERTY ACQUISITION COSTS (US$/LB) --------------------------------------PROPERTY TYPE---------------- ----------------------------Exploration---Development---Production Normal Expected Lower Limit--US$0.005------US$0.015------US$0.045 Expected Average-------------US$0.010------US$0.020------US$0.060 Normal Upper Limit-----------US$0.020------US$0.030------US$0.085 Lower-% of price*------------0.6%-----------1.8%----------5.4% Average-% of price-----------1.2%-----------2.4%----------7.2% Upper-% of price-------------2.4%-----------3.6%---------10.2% Note Upper and lower limits are for an "average" acquisition, and are often exceeded for various reasons. Source:Mining Business Digest. *End-1999 price of US$0.837/LB. All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[mr ashley james] 13/8/2005 21:27

Jon, I am from the school of something is worth what it is worth. BBs to me are storage bins of data nothing more basically. The rest is bluntly irrelevant, so whilst I accept in many areas less is more, indeed I could not care two hoots whether people post on threads I set up, because I do the numbers for my own reference and really only want relevant posts of data so that I can invest professionally and trust other shareholders will update each other on the latest news, media coverage, comment and macro political/geopolitical issues as they discover them. Bluntly what I am saying is ramping/deramping in the medium term is irrelevant there being a buyer and seller behind every trade, a bull and a bear, in the short term indeed the market is to quote Warren Buffet a voting machine longer term a weighing machine, ie normally longer term the intrinsic value is all that matters bluntly. Best of luck with LSE:AAA Cheers Ash:)

[jonwig] 13/8/2005 19:46

Ash, Ram2 hasn't posted here for 4 weeks (since 18 July) which may, of course, be of no consequence: it was always a quiet thread anyway. Looking at your thread, I must say I'm very much a minimalist - brief header and necessary links with announcements and stories given links, too, rather than the full story. However, each to his own of course. Regards, John

[mr ashley james] 13/8/2005 19:32

Rambutan, Excellent Thread, well put together and very useful links, I have set up another thread so that I have all the resource numbers I need to do, ie my Resource/Reserve and IRR numbers and valuations on, ie it is far easier for me to have data I need to work from in front of me in the header when I do my calculations. All the best. Cheers Ash:)

[mr ashley james] 13/8/2005 18:08

Roland, Placing 15th January 2004 with M & G Investment Managers Limited ie Prudental Assurance Co. Plc was at C$1.60 Raising C$5,600,000 ie 3,500,000 units at C$1.60 roughly 74.00p TSE:AAA 52 Week Range: C$0.95 to C$2.40 LSE:AAA 52 Week Range: 45.62p to 100.00p Is Democratic Republic of Congo in fact investable in I ask? All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[mr ashley james] 13/8/2005 17:59

Roland, I come to market capitalisation at say C$1.60 or 74.00p SHARES IN ISSUE 70,735,925 shares in issue at 74.00p £52,344,585 or C$113,177,480 FULLY DILUTED 6,156,000 options outstanding 1,679,656 warrant options outstanding Combined Total 78,571,581 fully diluted ie market capitalisation £58,142,970 or C$125,714,530 on a fully diluted basis It appears that this market capitalisation of C$113,177,480 included cash of C$11,321,857 Per 30th April 2005 and six months cash burn was C$3,791,989 31/10/2004 to 30/04/2005 I quote:- "As at April 30, 2005, the Company had cash and cash equivalents of $11,321,857,compared to $16,264,314 at October 31, 2004, and had working capital of $10,312,823 compared to $15,113,846 at October 31, 2004." So it strikes me true valuation of their participations in these projects is not far above C$100m per 30/04/2005 I come to C$101,855,623 Net Cash. Seems pretty cheap to me for the upside potential? All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[mr ashley james] 13/8/2005 17:42

Roland, Reviewing this refer:- http://www.advfn.com/p.php?pid=nmona&cb=1123952410&article=11580237&symbol=L%5EAAA Interim Results RNS Number:5110N Adastra Minerals Inc 14 June 2005 14th June 2005 ADASTRA MINERALS INC. Interim Results ended April 30, 2005 and 2004 (Unaudited - Prepared by Management) MANAGEMENT'S DISCUSSION AND ANALYSIS Results of Operations The Company incurred a net loss for the three months ended April 30, 2005, of $807,283, or $0.01 per share, compared to a net loss of $2,465,791, or $0.04 per share, for the three months ended April 30, 2004. The Company incurred a net loss for the six months ended April 30, 2005, of $1,549,100, or $0.02 per share, compared to a net loss of $3,179,672, or $0.05 per share, for the six months ended April 30, 2004. The results for the three and six months ended April 30, 2005, reflect the following factors: * Administration costs for the three and six months ended April 30, 2005 were lower overall than in the three and six months ended April 30, 2004. For the three months ended April 30, 2005, administration costs decreased to $894,322, compared with $2,321,152 for the three months ended April 30, 2004. For the six months ended April 30, 2005, administration costs decreased to $1,796,215 compared with $3,188,980 for the six months ended April 30, 2004. The decreases were principally due to reductions in costs for stock-based compensation and for salaries and wages. * The lower professional fees during the three months ended April 30, 2005, compared to the corresponding three month period of 2004, were mainly due to the fees associated with filing the Company's Annual Report on Form 20-F being incurred during the first quarter of 2005, whereas last year this form was filed in the second quarter. Over the six month period as a whole, professional fees were very similar to those for the six month period ended April 30, 2004. * During the three months ended April 30, 2005, investor relation expenditures reduced to $128,489 from $179,532. Similarly, for the six months ended April 30, 2005, investor relations expenditure reduced to $206,624 from $252,748. This was primarily due to being able to bring forward the date of the AGM to coincide with the week when one of the Company's major regular investor relations events was taking place in Toronto, and to various reductions in other costs associated with the AGM. * The increase in regulatory authorities filing fees compared to the six months ended April 30, 2004, was mainly the consequence of higher Ontario Securities Commission and TSX fees, reflecting the Company's higher market capitalization. Fees in the three months ended April 30, 2005, were lower than in the corresponding period of the prior year when there were fees relating to revisions to the Company's Stock Option Plan and also to share capital issuance. * The decreases in stock-based compensation for the three and six month periods ended April 30, 2005, compared with the corresponding periods of 2004 were due to the lower number of options granted during the relevant periods (30,000 options in the three and six months ended April 30, 2005, compared with 3,459,846 options granted in the three months, and with 4,109,846 in the six months, ended April 30, 2004) and to the timings of the vestings of these options. * Salaries and wages costs have decreased mainly because a higher proportion of salary costs has been capitalized to mineral properties and mineral property evaluation costs. This reflects employees spending more time on the mining projects than in the corresponding quarters of the previous year. * Higher interest rates obtained on cash balances, and the timing of the private placement of equity in January 2004, resulted in higher interest income during the six months ended April 30, 2005 than in the corresponding six month period of 2004. Average cash balances throughout the three months ended April 30, 2005, were lower than in the corresponding period of 2004, and resulted in a decrease in interest income. * The Company holds some of its cash balances in Canadian dollars and U.K. Pounds in anticipation of expenditures to be incurred in these currencies. During the six months ended April 30, 2005, the US dollar weakened against both these currencies and the Company recorded a foreign exchange gain of $37,860. For the three months ended April 30, 2005, the Company has reported a foreign exchange loss of $12,044, due to the US Dollar strengthening slightly against these currencies during the three month period. Liquidity and Capital Resources As at April 30, 2005, the Company had cash and cash equivalents of $11,321,857, compared to $16,264,314 at October 31, 2004, and had working capital of $10,312,823 compared to $15,113,846 at October 31, 2004. The decreases in cash and cash equivalents, and in working capital, as at April 30, 2005, when compared with the corresponding figures as at October 31, 2004, mainly resulted from expenditures on mineral properties during the six months ended April 30, 2005, and from the previously discussed loss on operations excluding the non-cash stock-based compensation expense. Issued share capital remained unchanged during the six months ended April 30, 2005, with 70,735,925 common shares outstanding throughout. During the six months ended April 30, 2005, the Company granted 30,000 options to purchase common shares, which increased the total to 6,156,000 options outstanding as at April 30, 2005. Outstanding warrants to purchase common shares remained unchanged throughout the six month period at 1,679,656. The Company believes it has sufficient cash and cash equivalents on hand to fund the Company's short term development activity. The Company will need to raise additional financing to achieve its long term development plans. The recoverability of amounts shown for mineral properties and mineral property evaluation costs, are dependent on the ability of the Company to obtain necessary financing and on other Exploration and Development and Financing Risk Factors discussed in the Company's 2004 Annual Report. During the six months ended April 30, 2005, there have been no material changes in the contractual obligations and critical accounting estimates as compared to those disclosed in the Company's 2004 Annual Report. Mineral Property Projects As at April 30, 2005, amounts capitalized in respect of mineral properties increased to $16,142,560 from $12,129,625 at October 31, 2004, reflecting $14,974,864 in costs incurred on the Company's Kolwezi Project and $1,167,695 in costs on the Angola Project. Capitalized mineral property evaluation costs increased to $4,428,009 from $4,397,126 at October 31, 2004, reflecting costs incurred on the Company's Kipushi Project. Kolwezi Project, DRC During the six months ended April 30, 2005, the Company primarily concentrated on progressing its Kolwezi Project. The first phase of the Definitive Feasibility Study ("DFS") - a scoping study analyzing different production levels - was completed. It was concluded that the initial design capacity of the plant should be to produce 5,500 tonnes of cobalt and 30,000 tonnes of copper annually, and work is now underway to complete the DFS on that basis. Work continued on the second stage of the Environmental and Social Impact Assessment ("ESIA"), and, in May, an Environmental Adjustment Plan was submitted to the Direction chargee de la Protection de l'Environnement Minier in the Democratic Republic of Congo. Work also continued throughout the six months on negotiating long term sales agreements and marketing arrangements for the cobalt to be produced, and on preparations for project financing. In late November 2004, the Industrial Development Corporation of South Africa Limited ("IDC") informed the Company that, subject to certain conditions, including receiving exchange control permissions from the South African Reserve Bank, it would be exercising in full its option to acquire 10% of the Project. On May 16, 2005, the Company announced that the World Bank Group's Board of Executive Directors had approved a proposed investment by its private sector arm, and as a result the International Finance Corporation ("IFC") would also be exercising its option and would acquire a 7.5% equity interest in the Project. The IFC, as is also the case with the IDC, will acquire its equity interest at a price based on the allowable expenditures on the Project up to the date of exercising its option, and will pre-fund its proportion (as a financially contributing shareholder) of the estimated costs of progressing the Project to a financed go-ahead decision. On completion of the IDC and IFC option exercises, the Company's wholly owned subsidiary Congo Mineral Developments Limited, expects to receive approximately US$12 million in cash. During the six month period ended April 30, 2005, the Company appointed Sullivan & Cromwell to advise on the legal aspects of the project financing. Kipushi Project, DRC In financial year 2003, the Company and Gecamines agreed that priority should be given to finalizing the Kolwezi Contract of Association ("CoA"). Following the execution of the Kolwezi "CoA" in March 2004, negotiations on the proposed revisions to the Gecamines Agreement were planned to recommence. Meetings were, however, postponed until after the end of financial year 2004, pending Gecamines' detailed review of, and response to, the proposals previously submitted by the Company. Gecamines' response was received during the quarter ended January 31, 2005, and negotiations, as to the appropriate way to take the Project forward, continued throughout the quarter ended April 30, 2005. It is now planned to carry out a Scoping Study before finalizing the revisions to the Gecamines Agreement. Once agreement on the revisions has been reached, and necessary GDRC approvals have been obtained, the Company anticipates that the feasibility study will commence. Kumba Base Metals, who in accordance with the Zincor Joint Venture Agreement ("ZJVA") could earn a 50% shareholding in the Company's interest in the Kipushi Project, were fully involved in the negotiations with Gecamines until the ZJVA expired on March 31, 2005, and continue to be kept fully informed. Angola Project During the year ended October 31, 2004, the Company found it impossible to progress matters further with Endiama in relation to its rights with regard to two mineral properties in Angola. In September 2004, it became clear that Endiama had repudiated its contractual obligations. Consequently, the Company announced that it would be seeking legal redress. Filing of the suit was, however, temporarily postponed pending the outcome of representations at senior government levels. No response was forthcoming; and accordingly on May 18, 2005, the Company filed a legal suit against Endiama in the United States of America. Related Party Transactions During the six months ended April 30, 2005, the Company paid or accrued an aggregate of $85,952 (2004 - $101,980) for legal services to a law firm in which a director of the Company is a partner. In addition, the Company has paid or accrued $1,000 (2004 - $-nil) for consulting services to a non-executive director, and $7,860 (2004 - $607) for consulting services to a company in which a director has an interest. Risk Factors The risk factors affecting the Company are substantially unchanged from those disclosed in the annual Management's Discussion & Analysis contained in the Company's 2004 Annual Report. Summary of quarterly results A summary of quarterly results for each of the eight most recently completed quarters is as follows: 2005 2004 2003 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Interest income $ $ $ $ $ $ $ $ 99,126 110,172 101,794 99,765 111,048 51,962 13,821 3,007 Loss for period $ $ $ $ $ $ $ $ 807,283 741,817 429,328 601,173 2,465,791 713,881 2,112,281 407,712 Basic and diluted $ $ $ $ $ $ $ $ loss per share 0.01 0.01 0.01 0.01 0.04 0.01 0.05 0.01 The main factors underlying the variations in these quarterly results relate to the timing of the granting of options, exchange rate fluctuations (particularly in the value of the U.S. dollar against the Canadian dollar and U.K. pound), and the incurring of mineral property evaluation costs. The Company made relatively large grants of options in the second quarter of fiscal 2004, and in the fourth quarter of 2003 modified its stock option plan to permit future "cashless" exercises. As a result, the Company recorded relatively higher administration costs and losses in those quarters. Forward Looking Statements This discussion contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 concerning the Company's plans for its Kolwezi Project, the Kipushi Project and the Angolan diamond Project and the resource size and economic potential of those projects. These forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements, including without limitation, risks and uncertainties relating to political risks involving the Company's operations and the policies of other nations and organizations towards companies doing business in such jurisdictions, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, the inability or failure to obtain adequate financing on a timely basis and other risks and uncertainties including those described in the Company's Annual Report on Form 20-F for the year ended October 31, 2004 and Reports on Form 6-K filed with the Securities and Exchange Commission. Contact us: London Tim Read Justine Howarth / Annabel Leather Chief Executive Officer Parkgreen Communications T: [phone] T: [phone] F: [phone] F: [phone] E: [e-mail] E: [e-mail] North America Martti Kangas The Equicom Group T: [phone] x. 243 [phone] (toll free) F: [phone] E: [e-mail] The discussion and analysis should be read in conjunction with the Consolidated Financial Statements of Adastra Minerals Inc. (the "Company") for the three and six month periods ended April 30, 2005 and 2004, and related notes (the " Consolidated Financial Statements"). The following discussion and analysis highlights significant changes since the discussion and analysis in the 2004 Annual Report, which should also be referred to for additional information. The discussion is based on events that have occurred up to May 31, 2005. Except as otherwise noted, all dollar amounts contained in this discussion and analysis and the Consolidated Financial Statements are stated in U.S. dollars. Additional information relating to the Company, including the Company's Annual Information Form ("AIF"), is available on SEDAR at www.sedar.com.

[mr ashley james] 13/8/2005 17:07

Roland, Tell me your thoughts on this one, high political risk location (refer Anvil Mining NL ASX:AVL) but quite frankly these grades are management proof IMO "The resource estimate for the Kolwezi Tailings, calculated by Dr. Isobel Clark of Geostokos Limited, is 112.8 million tonnes grading 0.32% cobalt and 1.49% copper, with 97% in the measured category (JORC Reporting Code)." IMHO Kolwezi contains 360,960 Metric Tonnes or 795,767,196 Lbs of Cobalt at 0.32% grade and 1,680,720 Metric Tonnes or 3,705,291,005 Lbs of Copper at 1.49% grade sitting on the surface, no mining necessary. Put into perspective that is at US$16.60 Lb Co and US$1.72 lB Cu by my calculations comes to following in situ Metal Value:- Cobalt 795,767,196 Lbs Co x US$16.60 Lb=US$13,209,735,450 Copper 3,705,291,005 Lbs Cu x US$ 1.72 Lb=US$ 6,373,100,529 Combined Total US$19,582,835,979 100% It seems Adastra Minerals Inc LSE/TSE:AAA own 82.50% ie US$16,155,839,682 That is one enormous amount of a couple of metals the world needs a lot of! Recoveries are high projected 76% Cobalt and 93% Copper ie I come to recoverable metals over a 38 year project life of 604,783,069 Lb Co and 3,445,920,635 Lb Cu. Then imagine the profits at cash costs of US$2.15 Lb Co and US$0.37 Lb Cu producing 42,000 Mt (92,592,593 Lbs) of Cu per annum and 7,700 Mt (16,975,309 Lbs) of Co per annum. At Current US$1.72 Lb Cu and US$16.60 Lb Co which is clearly not realistic as, if and when this supply would come on the market the profits would be enormous logically at any Copper or Cobalt Price likely. Project Finance at US$316,000,000 Depreciated over a 38 to 50 year Project Life are hardly enormous either potentially only US$8,315,790 per annum over 38 years or US$31,600,000 per annum if Depreciated straight line ten years ie front ended. All IMHO, NAG, DYOR etc, etc Cheers Ash:)

[jonwig] 12/8/2005 16:37

Hello Arf, Notice the graphs are % changes from a start point, each is local-currency based. AAA have said they will make the project long-term, with an eye on not disturbing the cobalt price. So far as sovereign risk goes, I have the strong impression that the DRC will want to milk the project through high taxation and a share in the equity. After all, if they just pinched it, they may find they can't export the stuff or have the technical staff to do the job. It's not the same as diamond mining where you can smuggle a fair amount away.

[arf dysg] 12/8/2005 16:30

Thanks for the comments about sovreign risk. The sovreign risk continues for the early life of the project: even after the mine is producing in 2006 or thereabouts, the DRC government may have a brainstorm and decide to re-arrange the mining industry. I'm not to worried about the cobalt price - that's a much more benign influence than governmental interference. The cobalt price may vary but doesn't have the potential for disaster which governmental interference does.

[arf dysg] 12/8/2005 16:22

jonwig, Does that account for exchange-rate changes between Sterling and the Canadian dollar?

[jonwig] 11/8/2005 09:58

Some dual-lists can often perform quite divergently between their markets. I just happened to look at AAA:

[jonwig] 10/8/2005 19:33

Hi, Arf Dysg. Rambutan2 has been in this for longer than I, and should have a more focussed answer for you. My main points would be: • The stuff is there, and the main risk by far is that the DRC government will interfere in some way or other with title. Renationalisation is the most extreme outcome, but higher taxation, increased bribery needs, armed interference, etc. all contribute to what would be called 'sovereign risk'. • Against that, the opposition have been in a sort of coalition and I sense outside investment in the DRC would be fairly continuous. The involvement of the World Bank and South Africa should have a stabilising/ positive effect on the share price. • Another concern is that the cobalt price may not stay high. There are quite a few other cobalt projects to come on stream, and future demand projection isn't as clear-cut as for some metals. If you look at some other country issues such as Central Asia (the '-stans') the same is happening, and some shares (eg. Oxus Gold) have prices which may look ridiculously cheap when the outcome is revealed ... or maybe not! Hope that helps, Regards, John