Goldplat Share Discussion Threads

[shill10] 23/1/2024 12:31

nice work Kimboy - why the reluctance to include the extra Gold oz ? Also there is the c6,000 oz pa that the recovery ops deposit every year going forward that they operate at current levels. DRD will of course be well aware of all of this, a bid makes sense for them, lets hope Martin agrees.

[kimboy2] 23/1/2024 09:14

I don't suppose anyone is going to the AGM. One year we may be lucky enough to have just one AGM.

[kimboy2] 22/1/2024 19:52

What I think we know from the Ergo feasibility study is;

1. The recovery rate is between 30-60% and averages 41.1%

2. The head grade of gold into the plant is 0.28g/t

3. At a recovery rate of 41.1% this gives a production of 0.115g/t

4. The processing cost is $5.3/t of feed ore. This is standard for all ore as they do not tailor it for feed type or grade, so it is constant.


Ergo Plant
At a production grade of 0.115g/t it requires 270 tons of ore to produce 1 ounce of gold.

270 x $5.3 = $1431 which is the cost of production per ounce, on average.


GDP TSF

GDP's TSF was estimated to have 81,959ozs (ignoring additional material)

If we assume 30% recovery we get 24,587ozs. Revenue at $2000 = $49m

The total tonnage is 1.43mt. at $5.3/t this works out at $7.58m


Capex
The total LoM capex for Ergo is $250m.

There are many ways to apportion the GDP part.

I would suugest that our 1.43mt is about 7% of one years feed. The life of mine is 20 years.

The attributable cost will be about $1m

Conclusion

On pretty minimal assumptions it looks as though the TSF profit will be at least $40m. The question is how this is to be split between DRD and GDP.

The DRD profit margin is 23% on the LoM plan which would be about $10m, but I think that may be a starting point for DRD given the limited alternatives for GDP.

Always a possibility of a bid if Martin Ooi decides to take it.

[shill10] 20/1/2024 22:46

great work guys - the biggest thing to add is of course that the new JORC will likely be 120-130k oz with the extra tonnage in the TSF since 2016 82k estimate.

[sea7] 20/1/2024 22:20

Page 4 does allude to the fact that predicted recoveries are between 30% and 60% dependent on the head grade and nature of the material. It indicates that these values are typical for gold TSF processing. As goldplats is much higher grade and has a jorc compliant resource already, then it is likely that they will consider the upper end of these estimates. DRD normally do 1.5m spacing drills to test, so they will be fairly happy with what is known about GDP dump so far.

section 19.3.11 on page 182 talks about optimising throughput to be able to process lower grade TSF's if gold prices drop - so they do have the ability to understand the higher grade TSF's and how they mix the throughput.

I suspect that Werner may agree to a fixed price deal for the Whole TSF, to be paid as it is processed, at a rate per month, based on the predicted recovery against the jorc grade and the fact that it will be pumped into that plant with everything else, which would dilute the yield somewhat overall.

[kimboy2] 20/1/2024 21:32

Well done sea.

The economic analysis is on page 178.

They say that each dump is different and the associated costs will be different, so that is a bit of a rider.

A few things about the Ergo plant, where our TSF is off to (eventually).

The average LoM grade is 0.28g/t. The average GDP TSF is 1.78g/t.

The average LoM recovery rate is 41.3%.

We don't know the recovery rate for our stuff. However I was told the higher the grade the better the recovery rate as there was more margin to chase the gold with.

On the economics of the LoM the DRD operating margin is about 23%. I presume this is for owned material and they are not buying anything in, though there may be some cost attached to what they originally paid for it.

That would mean the cost of production is $1386/oz at the $1800/oz they have assumed in the model.

That is of course at an average grade of O.28g/t.

If we assume for our TSF that
a) Recovery rate 50%
b) Processing cost $800/oz

Then on the 80koz dump there will be 40kozs recovered.
At $2,000/oz this will achieve a profit of $1200/oz
This will produce a total operating profit of $48m

If DRD take 23% then they will get $11m and GDP $37m.

I have probably gone wrong somewhere in all that so please point it out if I have.

[sea7] 20/1/2024 19:47

I think that it most likely spot on kimboy - Goldplat will want to be seen to be supporting the new refinery, which is a jv with the ghana government.

[kimboy2] 20/1/2024 19:37

The Ghana revenue of £22m would imply a production of something like 15kozs, of which 3,140 was exported.

I notice that 71% of production in Ghana went to one source. It wouldn't surprise me if it is this lot who are on their doorstep.

[sea7] 20/1/2024 19:25

This 185 page document is DRD Gold's effective date 30th June 2023 (dated 30th October 2023 in Johannesburg) Technical report summary of its tailings storage facilities. This document includes the ergo 19 year life plans and talks of over 80 TSF's to process.

They speak of 41% recoveries overall.

Whilst it doesn't appear to specifically mention Goldplats TSF the doc contains costings for a number of TSF's they are going to process and they state, that because they have been doing this for many years, their costs are considered to be accurate to the pre feasibility level - they see minimal risk to their cost expectations because they do this every day. With a comparison from one of the listed costings, against goldplats TSF size, we could likely estimate what it is going to cost to get it going.

It is a comprehensive tome, that talks of how they process the material and explains that material from many TSF's are pumped through to ergo at once -meaning, goldplats is likely to be mixed in, when it gets underway.

a long read, if your interested

[sea7] 20/1/2024 15:31

Thanks all

I did sell sometime ago, but at 6.2p the price was so compelling, I just had to deploy some cash.

Looking at the interims to dec 22, they say this about ghana.

The majority of material processed in Ghana during the half year was from clients inside the country, however we secured a larger consignment out of South America in December and should see the returns from this material during the last two quarters of the current financial period.
...

so, if the majority in the half year is in country, then it would probably be fair to say, that we are somewhat ahead of 3170 on the full year, kept and sold in country

South American revenue was £130k in the period june to december 2022

[ertugrul] 20/1/2024 10:55

Great research Sea.Let's see what will come this week.

[kimboy2] 20/1/2024 08:56

Long time no sea, again. I wish I was as good at google as you.

The numbers for exported gold from Ghana are interesting. The GRG turnover for 2022 was £22m. This isn't quite the same period but is indicative.

It would seem clear that only a minority of the gold is exported. Are there refiners in Ghana, or do they sell to middle men?

One thing to not in Ghana is the inflation rate and collapse of the cedi. Inflation is about 30% and the cedi has depreciated from about 6.5 to the pound to 15 in five years.

This is beneficial to GDP if the depreciation is quicker than the inflation. Haven't gone through it but Ghana tends to be pretty profitable.

The site is interesting. No idea what those sort of ponds are for, but it would seem there is plenty of room for expansion.

Years ago the limit on Ghana was about 15kozs and that was due to the machinery they had there. I would presume they are beyond that now. With the additional material coming from West Africa and Brazil it would be interesting to know how they will caope with it, if it happens.

[shill10] 19/1/2024 20:43

nice work Sea, good to have you back

[sea7] 19/1/2024 20:20

looks pretty busy and cluttered at the ghana aerial view!

[sea7] 19/1/2024 20:14

According to the above on page 66 - gold recovery ghana -goldplats subsidiary - exported 3,140 oz gold in 2022, which was an 84% uplift against 2021 at 1710 oz

[sea7] 19/1/2024 08:21

Extract from mintek shareholder performance compact 2022/23




Objective 2

Foster the industry by extending the life of the South African gold mining industry.

Objective statement

Extend the life of gold production through technologies, equipment supply and technical support that will reduce operating costs, improve efficiencies and maximise the value and life-of-mine of gold industries.

Baseline

Patented gold from carbon fines technology had been developed and piloted. A project to demonstrate the gold from carbon fines technology to transfer the technology had received state grant funding (R2 009 000). Industrial partners in both South Africa (GoldPlat) and Burkino Faso had been identified as vehicles to transfer this technology. Detailed process design is currently in progress. This is the first year of the technology transfer project.

[sea7] 18/1/2024 14:26

posted by flagstaff on another site...

Werner Klingenberg summing up key take home messages for investors following the webinar :

[kimboy2] 17/1/2024 18:36

The lack of focus is very frustrating, pursuing coal recovery for no apparent reason and venturing to new geographies (South America)...

The first thing is that gold is a declining market. There is less waste gold about. This is partly because there is less production, but also because miners have become more efficient in their production.

If GDP is to have any sort of sustainable life then it has to diversify.

FWIW I thought that coal was a good bet. There is an almost unlimted supply in SA of waste heaps. No idea about the economics of what they are potentially buying.

On South America they are already making a profit. They are spending a fairly minimal amount to buy some land.

I get the impression that they believe that there is plenty of low grde material. Presumably they are wanting to beneficiate it before sending it to Ghana.

This is only a diversification of source of material.

[gb904150] 17/1/2024 16:27

Did anybody watch the IMC live? I'd posted a 2nd question which was about the diversification to new geographies (South America) and how that would bring extra costs and complication.

For some reason that question, submitted at the same time as my one about diversification into coal didn't appear.

Any idea if that was answered? Or if they discussed South America at all?

[ertugrul] 17/1/2024 14:43

Hopefully this is a beginning of new correction era

[shill10] 17/1/2024 14:11

spot on shareholder- we have seen many times before this share can move 10%+ in either direction on £50k of share trades.

[ertugrul] 17/1/2024 13:53

Nice to see volume picking up and price moving up

[gb904150] 17/1/2024 13:37

I was thinking the same s7. Werner isn't a slick presenter but they are making slow, steady progress on the ground.

The lack of focus is very frustrating, pursuing coal recovery for no apparent reason and venturing to new geographies (South America) although Werner did explain it's more about the partnerships they are developing so perhaps there is more to it.

Perhaps they are also thinking about 'life after the TSF' if that is the eventual plan that DRD buy it.

Meanwhile we can wait a long time because the company is already very cheap, Mcap is probably less than the replacement cost of the SA plant and yet GDP has built up huge technical expertise in (profitable) metal recoveries.

On top of that the company is profitable, has cash and very little debt. Investors are fed up of waiting but progress has been made on GCAT, DRD/pipeline and the TSF / permitting.

Ghana has the licences sorted now so that is unblocked and while we know all about load shedding problems in SA there is a plan to mitigate that with the diesel generators.

If the company can just not get too carried away with the diworsification projects then I think the value will become much more obvious over the coming months.

[shareholder7] 17/1/2024 12:54

Looks like people are waking up but you won't be able to buy many shares as long term holders can see the value and will hold.Been topping up as this is buying gold at a big discount. Plus you also have a business that will recover once the generators kick in. Great share and I am pleased Werner is a bit dry and puts people off, you don't need a super start running this company when you are sitting on so much gold. Just have to go the pace of SA government can't do anything quicker.

[shill10] 17/1/2024 12:16

Werner said there would be no uranium recovery via DRD, not possible.