Iofina Share Discussion Threads

[superg1] 18/1/2014 09:15

I've looked some more into the current circs of Sirocco. Things they have said in the past have been suspect, and obviously we now know things didn't pan out the way they thought they would.

It's a key point as Sirocco were set to do 1500mt in 2013, so if they don't reappear that contribution to the market is gone for good.

My key argument with the then president of the company, was that by adding mobile units to grind the rough pebbles (seen as an ALP wear fix), that opex would go up, not down, as claimed. So we know they hit an all time high opex of $41 per kg just before operations were suspended and post mobile grinding units used.

That news

Softening prices, meant suspension.

The ALP is said will start again in early 2015 and the Mill built after that.

In the meantime in 2014 they plan to start up production via the heap leach method, but they laid off 150 staff.

Comments by them in that news-:

"In line with other Chilean producers the Company has made the decision to reduce production levels until the market returns to balance, which is expected by 2015"

"We are optimistic for higher iodine prices by the end of 2014 and into 2015, at which time we will complete the installation of the SAG Mill to realize annual production rates of over 2,000 tonnes."

So it appears they won't be coming back if iodine prices don't justify it, and imo they would need to be materially more than now. One point is by the nature of rising costs, opex will be higher in 2015.

BUT the real head scratcher is the laying off of 150 staff just before the year end. Yet they claim they will be doing 1000mt per year by the heap leach method.
The staff disposal costs them $1 million, it doesn't make any sense. They were only doing 1200 mt per year with all of their staff prior to 2013.

Chile is short of skilled miners hence they pay high wages to attract staff, those Sirocco guys will have moved on.

The final twist is what adds the real doubt to the claims. They intend to operate in 2014 with the heap leach method, not the ALP to produce 1000mt. That's an easy throw away comment.

We know the ALP method for the 3 quarters in 2013 had yields of 72%,72% then 44%, so iodine prices was not the whole story imo.
But the key point is the heap leach process.

From Sirocco's website

"In the heap leaching the iodine recovery is estimated as being 63% and in the ALP as 85%. The iodine plant recovery is estimated at 91%, producing an overall iodine recovery of 57% for heaps and 77% for ALP."

In a very recent report they say ALP 80% heap leach 55% so that's a 25% gap

The heap leach process means a 20% drop in yields. Average ppms have also been dropping. Below 500 for Q2 and 3 but a 522 average.

They didn't hit the ALP figures of 77% or 80% but 72% for Q1 and 2 then that big drop.

If they want to do 1000 mt from the heap leach process then they will have to process more material putting costs up.

So I don't see right now how they can continue to operate in the circs suggested. It doesn't stack up.

We'll have to wait and see what is in their next report, but surely opex will be higher if they go via the heap leach route.

Iofina appearing with 5 plants in play, may well cause them to throw the towel in.

[ammons] 17/1/2014 19:57

freshvoice, don't feel misled at all. Minor error, keep posting whatever you dig up.

[phoenixs] 17/1/2014 15:40

don't know if this has been posted.

[knackers] 17/1/2014 14:16

Looking at the current SP, one would be forgiven for thinking completion of IO4/5 wasn't due until end Feb 2015! Plenty of ground to be made up over the coming weeks IMHO.

[tackems] 17/1/2014 14:10

Sorry duplicate. Just to mention I have been in site construction for 40 odd years and I am heavily into IOF.

[tackems] 17/1/2014 14:10

I have got to agree with you Spike_1, there will be another 4 to 6 weeks yet to get the infrastructure in place for IO4 and IO5. There is no cable trays or cables (looks to be underground access for this), no relief valves in place, no instrumentation, no pipework hook-up. It looks as though they are working late at night with a floodlight trailer. Presumably the a/c cabin will house the DCS (control system) and this will need to be connected to the plant items. My estimate looking at these photographs is the end of February for initial commissioning. I would of course like to be proved wrong.

[driller50] 17/1/2014 12:55

MMO buying
@ZaksTradingCafe Mercom Oil Sands Possible Acquisition, New Adviser Northland Capital Dr Patrick Cross,CEO

[phoenixs] 17/1/2014 12:55

Full steam ahead,weather forecast good for foreseeable future.
Its all about delivery, then beat and repeat.
Should be a very interesting few weeks ahead:
1)IO4 and 5 producing.
2)Iodine contract?
3)Water permit?
If all three happen during this period then bears will be hibernating!

[superg1] 17/1/2014 12:40

Bob

I see your point and if the Q1 dragged on with no comment and without those photo's no doubt the usual suspects would try to use that as a fear matter. Towers not arrived, suppliers let them down again, plants late blah, blah, blah.

The fact is io5 looks 95% complete and io4 with cranes ready to go to lift the towers in, on a pleasant sunny day.

So when they start up, and get up to speed, at what daily rate then?. As currently looking at the pics we could expect them to be functioning well by the end of Q1 instead of waiting to see if they were built by the end of Q1.

With presentations coming up, they have some good evidence to show, progress is being made.

[bobsworth] 17/1/2014 11:05

square1
I hear what you say but after months of them bashing its difficult to hold back on the bear baiting! I will do my best to refrain and just be grateful for the opportunity to have topped up on the bear raids.

[phoenixs] 17/1/2014 10:59

frshvoice. was he Japanese?

[monts12] 17/1/2014 10:51

freshvoice 17 Jan'14 - 09:58 - 14773 of 14776 1 0

What are you expecting the company to imminently announce?

[freshvoice] 17/1/2014 10:49

I have checked and I think it's to do with accents

There will be news IN photos this week

Or

There will be news AND photos this week

Sorry to those I mislead.

[phsycho] 17/1/2014 10:16

Freshvoice, it could be Monday , you never know :)

[bogg1e] 17/1/2014 10:04

Captain cheers for mentioning about the updated piccies. Awesome.

[freshvoice] 17/1/2014 09:58

Oh well my source has been marked down as half reliable
Photos. Yes
RNS. Not today

[indiagolf12] 17/1/2014 08:41

What do folks think of BLUR? Was tempted 3 months ago but unsure that the concept was really viable. The market clearly thinks it has massive potential - do they really have a 'golden bullet' or is this another e.con?

[captain_kurt] 17/1/2014 08:21

Evidence of good progress on the commissioning of the two big plants showing by the photos on the company website.

So very shortly we will have doubled the number of big plants producing iodine and
in 2 weeks time we could have a positive outcome following the water board meeting, which isn't priced into the current share price for a company that is looking to produce triple digit growth on the Iodine business alone.

[superg1] 17/1/2014 08:20

Spike

Not about commissioning just built was the key. What we knew was that suppliers had failed to meet timelines, and that Q1 was the target to complete them. FRP towers were the main issue, we could see import data suggested the Titanium version for i04 had arrived.

So now Investors know, towers for both io4 and 5 have arrived, and io5 towers look pretty much complete other than that small pipe connector on the top.

It seemed the plants had been just waiting for towers.

The worry for many I would imagine, was those towers being delivered by the suppliers.

The FRP towers would have been new spec for the supplier, so now we know the design has been completed, and the actual product developed and delivered.

[jointer13] 17/1/2014 07:52

back on track....as was always going to be.

nice to see the photos,looks like our bod are keeping us a bit more informed re the website....should take away the doubts.

all good progress.....they are delivering

shouldn't be too long before we hit the 1000mt p.a. figure.

all bodes well.

"we are changing the world of iodine forever"

[freshvoice] 17/1/2014 00:36

Uriney
Thanks, I was looking at ADVF

[uriney] 17/1/2014 00:31

Fresh,

It is a late reported trade on LSE, ignore the high and low share price for the time of the trade as that info is from today's trading limits.

14-Jan-14 13:20:23 98.50 150,000 Sell* 100.25 102.00 147.75k O

It was marked as a sell however I believe it was be a buy.

Uriney

[freshvoice] 17/1/2014 00:19

Uriney
Thanks where do you find that ?