Angus & Ross Share Discussion Threads

[moreforus] 17/7/2009 11:28

note we are already there, we already have a mine which is already paid for and we just need to get digging...compare and conrast with the below...

Mongolia Seeks $25 Billion of Investments in Mining (Update1)

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By Shigeru Sato and Michio Nakayama

July 17 (Bloomberg) -- Mongolia is seeking $25 billion of overseas investments in mining in the next five years to develop some of the world's largest untapped gold and copper resources.

"We want to embark on one large-scale mining project every year, and an investment of $5 billion is required" annually, Prime Minister Sanjaa Bayar said in an interview in Tokyo yesterday. "We want countries like Japan to take part because they have technologies to develop gold and copper mines without damaging the natural environment."

Companies have struggled to start projects in Mongolia. Vancouver-based Ivanhoe Mines Ltd. has tried for more than five years for approval to develop a copper and gold mine. The company faces further delays after Mongolia's parliament authorized the cabinet yesterday to negotiate a deal, disappointing investors expecting outright approval. Khan Resources Inc. and Centerra Gold Inc., both based in Canada, have had licenses suspended.

"The key issue will be whether the government has the political will to go ahead and create the best environment for international capital to come to the country," said Alisher Ali Djumanov, chief executive of Eurasia Capital Management, an investment bank focused on Central Asia and Mongolia. "The track record has been mixed at best."

Bayar, who met with Japanese Prime Minister Taro Aso in Tokyo yesterday, said Mongolia needs $5 billion of investment to develop the Tavan Tolgoi coal mine in the Gobi Desert. He didn't give details of other mining projects or name companies the government is in talks with.

Oyu Tolgoi

The Oyu Tolgoi project that Ivanhoe seeks to develop about 80 kilometers (50 miles) north of the Mongolian border with China may have copper resources of 78.9 billion pounds and 45.2 million ounces of gold resources, the company said last year.

Ivanhoe fell the most in four months in Toronto yesterday on speculation that approval delays continue. Rio Tinto Group called Oyu Tolgoi "the world's largest undeveloped copper-gold resource" when it agreed to buy 10 percent of Ivanhoe in 2006.

Mongolian ambassador to China, Galsan Batsukh, said yesterday's vote by lawmakers clears a hurdle for an agreement with Ivanhoe and Rio Tinto because the 76-member parliament will no longer be involved.

The deal will be completed "at the earliest possible date because Mongolia really needs this project started," Batsukh said by telephone in Beijing today. He declined to give a time frame for reaching an agreement.

'Must Hasten'

Under a 2007 draft investment agreement, the government would have had the right to a 34 percent equity stake in the project and related taxes equivalent to 55 percent of the profits, Rio Chief Executive Officer Tom Albanese said in February 2008.

Mongolian President Tsakhiagiin Elbegdorj said last month he wants to change the terms to allow the government to take 50 percent of the profit, rather than buy an equity stake.

"We must hasten the development of Oyu Tolgoi," Prime Minister Bayar said yesterday, speaking before news of the parliament's approval broke. "Amid the severe economic conditions, our gold and copper production isn't enough," he said at The New Otani hotel in Tokyo.

Commodities account for more than a third of land-locked Mongolia's exports and a slump in copper prices amid the global recession has hurt economic growth, prompting an emergency loan from the International Monetary Fund in March to help the country maintain social order.

Economy Slowing

Washington-based IMF projects the country's economic growth may slow to as little as 3 percent this year from about 9 percent in 2008 because of a drop in exports of commodities.

Mongolia's copper output totaled 370,000 metric tons in 2007, Japanese government data show, while gold production was about 17 tons, according to a report compiled by the state-controlled Japan Oil, Gas and Metals National Corp. The Tavan Tolgoi mine may have 5 billion tons of coal reserves, according to Jogmec.

Capital inflows will "depend on Oyu Tolgoi and Tavan Tolgoi," Djumanov said by telephone from Mongolia yesterday. "I think $5 billion a year is something that's going to be not obtainable the way things are progressing right now."

Toronto-based Khan Resources Inc. said on July 15 Mongolia suspended one of its uranium mining licenses for unspecified violations. Centerra Gold Inc. said June 12 operating permits for its Boroo mine were suspended and may be revoked after a review.

To contact the reporters on this story: Shigeru Sato in Tokyo at [e-mail]; Michio Nakayama in Tokyo at [e-mail].

[moreforus] 17/7/2009 11:25

SEDA s a necessary evil, the last placing created the overhang..for the price to move up it's simply a questions of supply and demand and more buyers than sellers, once the company is cash generative as they say by the year end then there will be cash for expediture and investment before any external fudning is sourced. It's clear that there is a lot of uncertainty and skepticism or there would be a lot of buying and the price would move up and people would not be bailing when the bid hits 2p...this is because the stock is unpopular - however the price is then driven by sentiment and not fundamentals which have improved and will continue to do so. At some point once the company prove they can deliver then the price will take off dramatically as sentiment converges with the improving fundamentals.

[julianc35] 17/7/2009 10:38

SEDA comments on another thread GKP

Maybe that is what is holding the price down here and is the cause for the overhang that keeps getting mentioned.

Lord Buffett - 17 Jul'09 - 10:20 - 4694 of 4696


cashandcard - 17 Jul'09 - 09:08 - 4677 of 4694

"I mean, that was what the SEDA was for right, to progress the ALGERIAN and Kurdish assets. But something must have persuaded management that it was no longer in the interests of shareholders to progress the flagship HBH permit in Algeria any further. Someone mentioned the other day on this board how the most recent RNS 14/07 spelt a sudden change in direction for the company to a streamlined, focused, Kurdistan operator....Why?"


I have previous experience of these drawdown arrangements, notably with YA's predecessor company, Cornell.

The previous company I was invested with thought, i.e. were under the impression, that Cornell were 'investing' in them, i.e. giving them cash in exchange for equity, albeit at a 5-10% discount to the current market price.

This subsequently turned out not to be the case, i.e. Cornell were simply interested in making a turn on their cash through zero-risk arbitrage, that is to say they sold shares in the company immediately and possibly even shorted them in advance of receiving them.

This obviously had the opposite effect to that intended, i.e. it supressed the shareprice and caused greater than expected dilution.

As soon as the company realised what was going on they immediately stopped the drawdowns as it was obviously not going to be in the interests of shareholders to continue raising capital in this way...

Maybe that's what happened with GKP and why we haven't seen any further drawdowns for a while. It may also be why they've decided to sell Algerian assets rather than the opposite scenario of not only holding on to them but further investing in them using funds from the SEDA.

If one company can be naive about such things so can another

[yorgi] 17/7/2009 10:00

As for sending AGU an email I have not found them very good at all in replying. I sent one over a year ago about something......forgotten what my question was but I did not hear anything

Recently I sent an email twice about their website and have not had a reply......does not impress me

[moreforus] 17/7/2009 09:37

different management now - guess the reputation of a different management team is keeping the lid on the price however they completed the purchase of the gold mine as promised..and have said will get it into production this year so it's a question of trust - all of this has nothing to do with intrinzic value and cost of production and profit - which will be far in excess of the companies current market cap

[hiijinx] 17/7/2009 08:34

they also need to show a very clear timetable for the work on the mine to get it back into production. going on agu's past record i dont see gold being produced this year

[hard work] 17/7/2009 07:19

...but they still haven't been able to call the EGM to convert the debt. I feel an email coming on...

[eye2] 16/7/2009 22:43

longest time with no movement since ,well this year, wake up people.

[eye2] 14/7/2009 08:17

lloy is on my watch list some movment there your wright big caps explain it better.

[moreforus] 14/7/2009 08:09

have a look at a large cap like rbs or barc on level 2..you'' see how sets trading pattern in a large cap is totally different to seaq small cap aim stocks. non-mms can enter orders on sets means market tends to be more liquid...

[moreforus] 14/7/2009 08:01

i'm happy to buy agu at 1.75 and sell it at 2.25 all day long....

[moreforus] 14/7/2009 08:00

buyers will only want to pay less than they want to sell for....

have a look at tig..on sets...

[eye2] 14/7/2009 07:57

mores, i have level2 for a few week trial,norm have level 1, why does it the sell orders side has the higer price and buyoders with low price? im a nunpit at times im just trying to get best out of it ta. only if ya have time.

[eye2] 14/7/2009 07:47

tink we are over plip in dow/sp500 bows well for those that are holding on in stock just steady earnings now then we are off.

[moreforus] 14/7/2009 07:32

blue today

end of correction...

[eye2] 14/7/2009 07:31

moron's died in the iceage in greenland.they are trying to move it,it's siting on our gold.

[moister] 13/7/2009 21:45

Where has moron gone??

[moreforus] 10/7/2009 05:16

doh! sorry, thanks!

[mariopeter] 10/7/2009 04:19

More
Thats why we have the sixth link above. Could be interesting one day but base metal price making it not so exciting currently. Was in fact the reason the company floated in the first place .....ah the good old days when there were only 30m shares in issue now theres nearly a billion.

[moreforus] 09/7/2009 19:01

i believe they are aiming to do it onsite...
however i think i read this in one of the emails nick had posted up here...

just for interest found this under other projects...

[hiijinx] 09/7/2009 18:21

hard work, are the gold costs based upon the in-mine concentrator up and running or sending the ore of to be processed in canada. it makes a difference as it will take time to get the concentrator running.