Ironveld Share Discussion Threads

[rec0very stock] 09/8/2022 13:53

One of my biggest frustrations and quite frankly the biggest failure of GC and the various CEOs he has had as his puppets is they never did anything properly.

The 2014 DFS was RNSed but not published and we don't have anything for the current project which is similar but also radically different. The DFS should be supported by other studies and other studies should be done as a result of it. The EMP would give everyone the answers on things like what needs to be done about "farmer Giles" and his dead ancestors - there was an ESR submitted for approval back in 2014, but that all went cold. We would not be arguing about these risks and issues, we would know and be able to make our own assessment of the risk reward balance.

Vanadium is a by-product credit, the product is HPI - I put a little research on that on here and invited others to do the same and share it so we could improve our understanding of the market for that - nobody did.

A while ago the price of V was going through the roof. It is no surprise that Glencore want the V Slag. In time there would undoubtedly be offtake for Ti Slag and HPI.



On the day the 2014 DFS was RNSed (23/4/2014) saying in production end of 2015 V2O5 98% (ie pure stuff not slag) was $5.7/Lb. It peaked at $28.8/Lb at the end of Nov 2018. It is $7.4/Lb today and heading down - it will bounce around as all these things do. We don't know the terms of the offtake deal to know how the price of V2O5 will relate to what Glencore pay for slag delivered when / if it ever is delivered.

Massive missed opportunity not getting into production for the 2018 V Price spike.

What if, instead of messing around for the last 10 months, IRON had produced and published an up to date DFS? Firstly all my posts would be redundant, questions anybody had could be easily answered with a copy paste of the relevant bit of the DFS. Secondly the placing could have been based on the risked NPV of the project. Thirdly it might have been possible to get some proper debt - ie not the nonsense proposed by Align, on a 70/30 debt / equity split. I question the sanity of putting in equity without a DFS, GC would have the door slammed in his face if he tried for proper debt.

[tima441] 09/8/2022 12:21

One possible outcome.. if they deliver

[rec0very stock] 09/8/2022 10:34

Most amusing Al

"forgot about the city that sits on top of their resource" - bit of cognitive dissonance between rural and urban - very good

"It's pretty standard for this to be left until the last minute and nobody really takes any notice until some guy with a shovel arrives and starts smashing the windows of the local South African Starbucks. At that point I guess a bunch of African non-binary SJW eco-warriors turn up to protest and the whole thing turns in to a bit of a mess."

Very good, there is no process, only a compulsory obligation to cough up, in SA legislation, so it could be like that. Though as the charming young lady explains in the video, it is not that bad as SA wants to follow International best practice, but like most things SA wants to do, it rarely does.

"forgot that the bloke with a shovel needs paying." I doubt they have forgotten it as they keep being reminded on twitter feeds and it is a compulsory obligation in SA law. What I doubt is that they know how much they are going to have to pay all the blokes with their shovels and to relocate all the graves of his dead ancestors - bit more process defined in SA law on that. I am also certain that the money raised in the placing and broker option won't be enough to cover the costs of this and everything else which your amusing ditty thinks GC has "forgotten about" beyond just the purchase of the smelter.

"GC somehow also forgot his own salary, which seems just like him." LOL I predict PLC costs will go up a bit to £1m per year now there is money in the kitty to pay GC et al in cash not shares. That sound more like him to you?

There are a lots of cost and time risks we cannot assess because in 4 words:

THERE IS NO DFS.

Really simple rule for AIM miners: No DFS, No investment.

I will run the guess the date of the 2023 placing competion in the new year as we should have had the annual report by then, which will include as much of an update on what has occurred since the 30 Jun accounting date as GC decides he wants to tell us plebs (the elephant never forgets (as RJ is likely to discover), it just does not tell us what it knows or guide us on what it does not yet know). I can open the book now for you if you want to have a go - we are all only guessing and enjoying the ride after all. GC is a crafty fox when it comes to getting discounted placings away and pretending it is oversubscribed when the end outcome is only 90% of what could have been raised, so there is no shame in being way out with a guess on the price either if you want to have a go at that one.

[al101uk] 08/8/2022 23:08

So we have RS's narative:

Ironveld management have raised money at a huge discount, but they forgot about the city that sits on top of their resource. It's pretty standard for this to be left until the last minute and nobody really takes any notice until some guy with a shovel arrives and starts smashing the windows of the local South African Starbucks. At that point I guess a bunch of African non-binary SJW eco-warriors turn up to protest and the whole thing turns in to a bit of a mess.

Unfortunately, not only did Ironveld forget that people exist in your typical African metrolpolis (with the exception of schoolgirls who exist in a vaccume or are shipped in from remote locations), they also forgot that the bloke with a shovel needs paying.

GC somehow also forgot his own salary, which seems just like him. He didn't realise that a turn key mining operation (which he didn't cost and can't pay for) would also involve hiring a full compliment of staff, nor that running a mine (that he can't build anyway) might require some working capital.

Everyone knows that Iron is generally collected from each mine once per year and only paid for on delivery, where as all costs are paid immediately and up front, so that's an issue.

You see what I did there, I took what you percieve as real fact based risks and exagerated them to make Ironveld seem less appealing. Wonder where I got that from?

[malcolmmm] 08/8/2022 20:25

Even if they dont like it this is a public company making money from the public and is therefor accountable to the shareholders who collectively own the company. If they leave themselves open to criticism so be it.

[rec0very stock] 08/8/2022 20:22

Fear not there will be another placing in 2023 and I will run the guess the date competition in the new year.

How much more could have been raised in the placing?

"Up to GBP1.0 million Broker Option to enable existing Shareholders to participate in the Placing" - "it has raised GBP500,000 (before expenses) pursuant to a Broker Option following the conditional Placing announced on 13 July 2022."

Surely those who were disappointed not to get all they wanted in the "oversubscribed" conditional placing, got all they wanted through the Broker Option - it was open to anyone, not just existing shareholders.

With Broker Warrants exercisable at 0.3p, what price are TPI going to be trickling shares into the market ahead of exercising them at? 0.36p bid gives 20%. All those placing shares and broker option shares at 0.3p, did they all go to long term shareholders who are happy to bottom drawer them and wait for the great day when the company is cash flow positive at PLC level and paying a dividend? Or will some of them think 20% or even 10% is good enough for me? Maybe some will have better things than wait to see if they ever do get their money back and will sell below 0.3p? I have lost count of the number of times an share price has dived straight through the floor set by the placing price and then it becomes a ceiling.

Maybe alongside the guess the date competition, you should run a guess the price competition.

As a final bit of idle speculation, how much do we think RJ's Broker Option to raise £1m at 1p would have raised if:

a. The BoD had accepted it as better than the placing they had started the book build on, so RJ did not throw his toys out of the cot?

b. If the BoD had accepted it after RJ had thrown his toys out of the cot?

[ladeside] 08/8/2022 19:47

Maybe we should do another placing then ??

0.20 ??

0.10 ???

Of course, if the above was true they would just have raised an extra £500k when doing the main placing as they would have got it away no problem at all.

[rec0very stock] 08/8/2022 19:43

Indeed. How much money is needed? How long will it take? One would HOPE, given the funding has, since the GM in Nov, been about to arrive "shortly", the company has been progressing the discussions. But then again you would HOPE that a significant shareholder, who claims to run a research company and has had tweets responding to his own feed, would have done some research, especially as he was proposing his own much smaller funding package.

Quick extract reminder from an earlier post for those who missed it:

Gross money raised £4.5m - Call it £4.25m net of expenses. (Broker Warrants if exercised (SP needs to be above 0.36) trickle in another just over £1m).

PLC costs per year - Call that £1m, so leaves £3.25m.

Smelter intial payment £750k leaves £2.5m.

Smelter refurbishment was £2-3.2m but hasitily revised to £2m including contingency by a guy who has a track record for misleading the market. But let's go with £2m leaving £500k.

The landowners need to be paid off - that is a fact. The resource is under farm land where people live, work and derive their income from the dirt on top of the resource that IRON wants to dig out How much of that £500k is going to be needed? I don't know but I would not be surprised if it does not cover it.

A turn key mining contract needs to be set up - what will be the working capital requirement? I don't know, but I would not be surprised if £500k does not cover it.

What will the smelter OPEX costs be? I don't know but staff will need to be paid, insurance premium on £30m insurance value and 7.5MW x how many hours? at what cost per MWHr? Noting that there are lots of hours where the power simply gets turned off and those hours are increasing. How much will all that cost? I don't know but I would not be surprised if £500k does not cover it.

[ladeside] 08/8/2022 19:24

The local authorities, local economy and black empowerment blokes will all benefit hugely if we become operational so even if Farmer Giles (or his African equivalent) is ranting about "get off my land", I'm pretty sure he / they will be removed without too much of an issue.

Money talks as always.....

[rec0very stock] 08/8/2022 18:51

When has the company told us it has happened or is going to happen? All we know is from tweets and we should know from the company. We know they do something at a girls' school, though I doubt the charming young lady in the video goes to that school. She does explain it all rather well - better than all my posts I guess.

Whatever has been achieved by way of agreement already, the relocation process itself has not started and has not been paid for. It is almost certain that GC will try to ride roughshod over the living, whether he will get away with it remains to be seen. He may find he has a far bigger problem riding roughshod over the dead. We shall see, time will tell, at least we on this BB are aware of the risk, even though we lack the information needed to assess it fully.

[al101uk] 08/8/2022 17:30

RS,

When would the "research and consultation with affected parties regarding social impacts of mining operations" happen do you think?

You appear to believe that it's after all the development work, offtake agreements and cash raises have been done, the mining equipment is onsite and the guy who is there to start the whole process has his hand hovering a few inches above the big red button with the word "GO" printed on it.

I'm imagining the scene from Hitchhikers Guide to the Galaxy when Arthur wakes up to find his house is about to be demolished.

[rec0very stock] 08/8/2022 15:43

For those who struggle with more than a tweet here's a video:

[rec0very stock] 08/8/2022 13:43

It is a fact that any mining company is required by the law of the jurisdiction where they intend to mine to relocate and compensate those who live on the land where they intend to mine. Hopefully that is a statement of the blindingly obvious.



"Residential and Agricultural Relocation
Beyond section 54 of the MPRDA, there is no mining or mining-related legislation regarding the process of relocating households that live upon or next to land that is to be mined. Section 54 deals with compensation more generally and is elaborated upon here. There are no explicit guidelines that must be complied with in terms of South African law regarding the relocation of households and compensation for loss of agricultural land. However the compulsory EIA process (see here for more info) requires research by mining companies and consultation with affected parties regarding social impacts of mining operations. The mining company must then produce and EMP which must show how it intends to deal with the social impacts identified. Through these mechanisms, it is clear that consultation and compensation for residential and agricultural relocation are compulsory obligations for mining companies to carry out."

How hard to negotiate especially when there are no explicit guidelines, how long it will take once agreement is reached and how much it will cost are unknowns - risks. We should have discussions about risks and there are ways of finding out more about them than just reading RNSs and company PR/IR fluff pieces - ie doing proper research.

In my experience properly derived NPVs are by nature conservative, I agree that the reality does not always match the assumptions that underpin the NPV, generally this is because risks materialised. Unrisked NPV is the start point which then needs to be risked. We do not have an NPV here at all to even begin any discussion about what risk to apply to it.

I believe I have made a similar statement to yours regarding not ruling out buying at some point in the future when there is greater certainty - there will always be a degree of uncertainty, mining is a risky business.

[al101uk] 08/8/2022 11:59

RS,

"There is a discussion with tima further up about the RJ holdings - the big drop in % is the dilution of the placing."

Believe it or not, I no longer read all of your posts, so I ocassionally completely miss relevant & important information you may provide. It's a shame you can't just ask the question "have I said this before" before adding the 5th paragraph to your 10th post of the day. I'm with Ladeside in that despite offering some genuinely helpful and useful insight, you just post too much of the same thing over and over and over again.

Investing isn't a game played with perfect information, I use the word "assume" as a shortcut, the alternative is to give a % chance of any single event happening, a waste of space imo. You've taken a different approach with comments like this:

"The landowners have to be sorted for mining to start."

Whereby you assume all of your opinions are fact. Ah, but you have the tweet from a real landowner... irreputable proof.

"generally NPVs are conservative"

Odd thing to say from someone who has follwed companies on the "AIM cesspit". I can give at least a couple of examples where NPV's have been anything but conservative.

I'm not sure why a post that says "I'm not buying, but I can now see a pathway to a circumstance where I might gamble a tiny amount of my money" would need such a comprehensive rebbutal.

This place is getting boring again.

[rec0very stock] 07/8/2022 21:39

Serious harm test, truth, honest opinon - must be clear it is opinion and an opinion a reasonable person could hold. Many have tried, all have failed - I must be doing something right.

RJ admitted he could not get me for defamation, so tried to threaten malicious damage, which is even harder. Honest opinion is not a defence, but proof of pecuniary damage and intent to cause pecuniary damage is required from the plaintiff. RJ has done all the pecuniary damage to himself and to other shareholders. He is now lawyering up to defend himself from GC, as I advised him he should.

It cost the solicitor £60k to try and then withdraw his injunction, did not cost me a penny.

I take it you agree that had I not used I think to caveat what was simply an exercise in illustrating the point I had made in the opening statement about hope and assume preceding PI disasters, it could have been defamatory.

[bigwavedave] 07/8/2022 20:53

Recovery -Maybe the fact that you've had threats of litigation means that you don't know how it works.Some years ago, I studied the law around defamation and needed to understand it for my job. So, take it from me, merely saying you are wondering out loud in a public forum does not offer a defence.The chances are no-one will give stuff about what is said on this particular bb which, let's face it, probably only attracts a tiny audience.But it is not unknown for bosses of listed companies to go after bb posters they believe have damaged their reputations (and/or their finances).Whether you are right or wrong won't matter if their pockets are deeper than yours.Just sayin'.

[purchaseatthetop] 07/8/2022 18:50

Or spent on their salaries and expenses for the next few years. I just wonder if that is the plan anyway.

[ladeside] 07/8/2022 18:16

Oh well, if the FCF purchase fails to complete, at least they'll have £4.5 Million sitting which can always be stuck on the favourite in the 3.30 at Windsor....

[purchaseatthetop] 07/8/2022 17:50

I am not sure that the FCF purchase will actually happen. It includes taking on the debt of £5m and includes other conditions precedent. What happens if they go ahead with the transaction and then there are delays on actually mining such as land rights disputes.

This is still far too complex.

[tima441] 07/8/2022 17:38

There are 2 things that just might yet surprise ... to the upside.

1. Grosvenor come up with the cash! No doubt with revised terms. I'm definitely not counting on it...

2. IF they keep to timetable...
Refurb
Stockpile ore
Start prod by Easter
Ramp up per plan
I am moderately hopeful only. But past failures means the share price not surprisingly is priced for a degree of failure to deliver.

So I've been happy to rebuild my position at these levels. Thankful I sold quite a lot at higher levels (wish I'd sold the whole lot!!!)

[rec0very stock] 07/8/2022 17:14

Agree entirely!

Take the cash they have now got and take off what needs to be spent - see post 6799 for a worked example - adjust the figures according to your own research.

Then for the reward see post 6800 for a worked example of how to do that and put in your own figures according to your own research.

For riding the waves to take advantage of fools spikes - there are lots of good posts to look at. The trouble with fools spikes is how many people have also worked it out the same as you and are also looking to take advantage.

The very best of luck to all who have contributed to the adult discussion and those who have just followed it, as you make your own investing / trading decisions on a better informed basis - always the best approach and can be very simple too. Eg I am happy with my 27k and am just going to maintain it and enjoy the ride. Really looking forward to 12th and will report back on 13th - it won't make any difference to anything but hopefully will be illuminating as well as entertaining.

[ladeside] 07/8/2022 16:31

What's done is done, if anyone wants to do a real risk / reward assessment here then they need to be re-basing their calculations on the FACT that the placing has been completed, we have the cash in the Bank and the new share price is 0.30 with a mcap of £9 Million.

Grosvenor are out of the equation, the 1p placing is out of the equation so from now on it's a question of whether the company can / could / should be valued at more than £9 Million.

That's it for me, sometimes the simplistic approach can be the best...

[rec0very stock] 07/8/2022 11:50

I've had enough threats of litigation, including the totally pathetic one recently from RJ, to know how it works thanks. Those who have tried, including the plaintiff (was a solicitor himself) who served for an injunction and withdrew it before it went to court, have always come off very badly. I once even got an apology from SRA and a few quid from the Law Society.

"Wondering out loud" is a pretty good description, I might use it thanks. That is how ideas get shared and developed.

So here's another idea to chew around. How amazing or unamazing is it that those who disregard the rules themselves and think they are somehow above the law, turn so rapidly to legal threats as soon as what they have done is pointed out publicly?

[bigwavedave] 06/8/2022 16:58

LOL! It doesn't work that way!