Chaarat Gold Share Discussion Threads

[juju44] 20/4/2020 19:34

I sold half but should have sold all. Done almost nothing in 2 years . Hot air but little delivery

[casual47] 20/4/2020 18:09

If they do get the debt down by $10m by repaying and part converting the $17m loan then the total debt (excl interest) would be $60m.

Deduct from that the ~$6m which will be repaid on the Kapan loan principal this year and you arrive at less than the $55m that Kapan was originally bought for.....

Perhaps that is the plan: to have all current debt supported and secured by Kapan, with zero debt against the Kyrgyz assets (prior to project finance). Perhaps they could refinance all current debt as one package: remainder of the $17m loan, $20m loan notes and remainder of the $32m Kapan loan.

For the Tulkubash project finance lenders it would derisk the project as Tulkubash will be completely standalone and insulated from any externals that have nothing to do with the project.

[casual47] 20/4/2020 17:53

Your complaining on here for years suggests the donkey is you. If you choose to remain invested then that's your problem. Could have sold at 38p.

[juju44] 20/4/2020 17:47

Yawn . What a bore . Miners moving up with gold but not this lame donkey

[casual47] 20/4/2020 15:20

The $17m loan was originally secured against the Kyrgyz assets. They have now moved it to the Kapan asset. This makes me think that they will be paying down this loan rather quickly and for this reason:

One of the covenants of the Kapan loan is:
"the Borrower shall ensure the maximum financial indebtedness of the Borrower cannot exceed US$ 41,000,000"

They test this covenant twice a year: once with the annual results and once with the interim results.

The current Kapan debt is $32m. That leaves $9m left to borrow against Kapan.

They can of course always get a waiver for these things and perhaps this was already pre-approved.

But it could be a sign that this $17m ($19.4m with interest) loan will be paid down quite heavily in the next few weeks (or days?)

Other signs why this might be so:

1. The $17m loan maturity postponement agreement had a clause allowing the lender to convert up to $5m into shares at the same price as others in a placing.

2. The agreement also had a clause that if $5m was paid down within 45 days of closing then the maturity date would be pushed back further to end of March

3. As part of Labro's guarantee commitment, there is a clause that says the fee for providing the guarantee would be increased by 8m shares unless the whole $17m loan was repaid by end of October this year.

So, I think the following is likely to happen:

1. The lender will convert $5m of the debt into shares. This brings the loan to $12m ($14.4m incl interest). Handily, the $5m conversion into shares will be below the 3% significant shareholder threshold.

2. Chaarat will pay down another $5m (Mr. A is providing $10m, $5m of which is cash). This brings the loan to $7m ($9.4m incl interest)

Et voilà: the $41m covenant rule has been satisfied.

[casual47] 20/4/2020 11:55

Some of the big ticket items in the BFS come from suppliers headquartered in Turkey and South Africa.

Turkish Lira has devalued about 18%
South African rand has devalued about 30%

Some supplies (e.g. steel) come from Kazakhstan. The Kaz tenge has devalued about 14%

The Kyrgyz som is down 15% vs USD.

[casual47] 18/4/2020 16:48

Pabs, pretty sure it would be teaching his babushka to suck eggs.

Mr A and Mr V are wily old foxes. They could talk a car salesman out of his gold fillings.

[2pablo] 18/4/2020 16:05

Casual, you have some very big ideas and, you never know, some of them might be reasonable.

Why don't you put them to Artem? If they're any good, he'll adopt them and take the credit for them, might even say thank you

[casual47] 18/4/2020 15:35

I think this may be the right time for Chaarat to approach the Kyrgyz government and suggest a JV on Tulkubash.

Kyrgyzstan has little money but they do have a 26% shareholding in Centerra (the whole of it, not just Kumtor) which has a market cap of US$2B.

It would make so much sense for the Kyrgyz government to reduce their stake in Centerra and invest the money in Chaarat's Kyrgyz assets instead.

It would also make sense for Chaarat to have Kyrgyzstan as a JV partner in their Kyrgyz assets as it could protect them further down the line (inevitably, if Chaarat ever gets to extracting gold the populace will start to complain that "foreigners" are stealing their sovereign wealth, they always do as few understand the risk-taking companies do and that the rewards are part and parcel of that process as otherwise nobody would invest any money to mine in the first place).

[casual47] 18/4/2020 15:21

Ministry of Health: CoVID-19 incidence peak expected in Kyrgyzstan april 20-24
Friday, April 17, 2020 10:46 Read 2036 times
By this time, additional beds are already being prepared in hospitals and facilities

In Kyrgyzstan, the peak of COVID-19 is expected between April 20 and April 24. This was announced today during a briefing by Deputy Health Minister Nurbolot Usenbayev.

"We are preparing, in hospitals and facilities are preparing additional places," he assured. - The Ministry of Emergency Situations also organizes beds.

The briefing also raised the issue of how infected patients are treated and who pays for medicines.

"The treatment is carried out on the recommendation of THE WHO, the course was adapted for our country and passed the algorithms to the doctors, - said the deputy head of the Ministry of Health. - Everything is checked and proven to be effective. Treatment is carried out at the expense of the state, patients do not pay.

[casual47] 17/4/2020 19:46

Armenia PM: Life may get back to normal in stages after May 14



Mining has been allowed throughout the lockdown. This week they have added other industry sectors such as textile.

[casual47] 17/4/2020 16:49

Mr 30k 'O' trade has been busy this week

[casual47] 17/4/2020 14:33

Looks like the Armenian government is also looking at changing mining regulation:

[casual47] 17/4/2020 12:42

A good article re. mining in Kyrgyz and Covid.



Looks like we may see the Kyrgyz government relax regulations later this year to assist miners and attract investment.

[casual47] 17/4/2020 11:11

35 mins in

[2pablo] 17/4/2020 11:05

Can't seem to pinpoint those points of Chris, at what exact timing in the webcast are they, Casual?

[casual47] 17/4/2020 10:25

Verbatim of relevant Chris' comment re. Project finance in Covid climate for Tulkubash:

(...) So we are still working and progressing with the Development banks. We have a number of term sheets in place we are in the process of formulating the full syndicate and moving into detailed DD and hopefully documentation but just the reality with how banks have now reacted to the current situation it would be unrealistic to think that we would close something in q2 or early q3 and therefore believe that the right realistic timing for closing the project finance would be towards the end of this year

(...) nothing has effectively stopped us from the project finance it just slowed down a bit. But I have to say every week is changing, people are ready to get back to work and the number of discussions I have had this week around the project financing I am almost getting back to the same levels around activities that we were before covid 19 but we are not there yet

[casual47] 17/4/2020 09:29

The webcast is online

[casual47] 17/4/2020 08:40

Coronavirus (recorded deaths)

Armenia - 19
Kyrgyzstan - 5

[casual47] 16/4/2020 17:02

The ideal solution for Chaarat would be to refinance the Kapan loan into an interest only loan. That would free up the $8m repayments per year for the next few years.

Possibly they may have a better chance to do this from early Q3, perhaps after the interims are out and when the world has figured out how to live with Covid.

If they can scale it up to $50m then:

$30m to pay off the existing loan
$20m to pay off the $17m loan (plus interest)

[casual47] 16/4/2020 16:31

Pabs, Sanne is Chaarat's employee benefit trust. It's where all the restricted shares go as part of the incentive scheme.

[2pablo] 16/4/2020 16:28

"Sanne Fiduciary Services Limited" whoever they are. They are third biggest behind Labro and China Non-Ferrous who haven't changed their holding in years.

They've got 4.6% au moment