Rainbow Rare Earths Share Discussion Threads

[shakeypremis] 04/3/2018 15:30

Simply finding $1 billion of rare earths in a deposit wouldn't necessarily result in a sustained rise in the price. It's all about whether the deposit is economic, permitting and how much CAPEX would be required to get the mining started.

However, in Rainbow's case, the deposit is very very likely to be economic being a condensed ball not far under the surface and not far from their existing processing facilities. The area is also already permitted and finally the initial CAPEX outlay is likely to be quite small in relation to the value of contained minerals.

So all in all, despite the fact a fund-raising would be required if the exploration proves successful it will likely not be particularly dilutive.

[maccamcd] 04/3/2018 09:09

If they find a $billion worth of Rare earths.. Nobody should worry about a fundraise or dilution anywhere near these levels!Stock would go straight to 50p

[shakeypremis] 04/3/2018 08:59

Let's remember they have been generating cash-flow since the end of December too. That said, if exploration comes in they are going to need more cash to get a JORC resource and develop it.

[maccamcd] 04/3/2018 08:07

its a tight run ship.. ex accountants/city financiers.
£3M in December would go a long way in Burundi
Bonanza drilling starting soon... fingers crossed over the next 3 months

[dplewis1] 04/3/2018 07:56

Well they raised nearly 3 million quid in December at 14p, so I would give you pretty long odds of another one in the near future..

[runthejoules] 03/3/2018 23:23

Chances of a fund raise folks?

[bo doodak] 01/3/2018 12:54

Once the JORC arrives, should further underpin future prospects.

[maccamcd] 01/3/2018 11:47

Good to see the RBW pushing on.. Large buyers wanting % stakes underpinning this journey.Not for top slicing in my opinion

[shakeypremis] 23/2/2018 18:20

No, they are selling to Tyssenkrup for at a 70% discount. Read the RNS's.

Rainbow might be able to get a better deal from another buyer but Tyssenkrupp have first right of refusal over the second 5000 tonnes per annum. So if Rainbow can get production up to 10,000 tonnes of concentrate Tyssenkrupp can buy the lot if they want it.

[chrismisson555] 23/2/2018 16:14

apart from using the term ore opposed to concentrate, a think 50% is prudent considering the volatility of the basket.

also with one buyer we have limited bargaining power over the percentages

[shakeypremis] 23/2/2018 13:08

Where do you get 50% from? I've always seen the basket price discount quoted as around the 70% mark.

[chrismisson555] 23/2/2018 12:57

I believe they get around 50% of the market price for their ore judging by the offtake agreement.

At current rates that equates to around $6.62 (13.24/2) from the RSN, costs per tonne seem to marked at $1481 ($0.4m / 270 tonnes)

If they reach their initial 5000tpa or 104tn per week.

(104 * 1000) * 6.62 - (104 * 1481) = $535,559 a week profit or circa $2m a month.

Highly profitable operation

[shakeypremis] 23/2/2018 08:50

I've found something of potential interest on the latest PowerPoint. Page 20 (as written on the page itself, or page 21 of the PDF) states the processing plant is theoretically capable of processing up to 42,000 tonnes per annum. That's 7 times the projected rate of 6,000 tonnes per annum. Why would they overspec the plant quite so much? I appreciate further capex would be required to get it to run at 42,000 tpa, but surely they could have saved money building something that could only ever operate at say 10,000 tpa. Perhaps they really believe they could get close to that figure in time with good exploration.

"Simple efficient gravity separation processing facility - 5tph throughput (theoretical processing capability of plant up to 42ktpa"

Very interesting...

[napoleon 14th] 21/2/2018 09:28

Had a big clearout yesterday to finance a deal outside market, but happy I kept these. Makes very sweet reading....

hxxps://www.directorstalkinterviews.com/interview-rainbow-rare-earths-major-milestone-achieved/412746118?utm_source=pushengage&utm_medium=push_notification&utm_campaign=pushengage

[maccamcd] 12/2/2018 16:27

bit of awareness in today's Evening Standard Market minnows section-

[mp79] 12/1/2018 10:11

It seems I made few mistakes in last calc. The basket price is in USD and it should allow 47-67% TREO grade (average 57%) allowance and not 100%. So I understand that correct revenues on $10 average basket price case at 4500 tons ore production for 2018 would be = 4500 x 1000 x 10 x 0.30 x 0.57 = 7.69 Mil USD.

With basket price of 12 USD/ton, that will become 9.23 Mil USD. So basket price is big and I guess only variable for revenue figures except tonnage production.

[croasdalelfc] 12/1/2018 08:27

I think they are targeting 2250 tonnes by end June with a run rate of 400 per month by Dec

[spooky] 11/1/2018 18:01

Well at least that gives me a starting point, thanks mp79.

[mp79] 11/1/2018 17:03

Someone at LSE website came up with following and I tend to agree with that.

First shipment in Dec-17: 25 tonnes = 25,000 kilos @ £8 per kilo = £200,000 - 70% discount = £60,000

and the same value at £12 basket price (which is more realistic as per Jan 18 presentation) = £90,000
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Lets say basket price remains average £10 per kg for 2018 then total revenue, it should fetch for 5000 ton ore production = 5000 x 1000 x 10 x 0.30 = 15 Mil. GBP.

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My old records from this website suggests that production costs are about: $1100 per ton i.e. about £815 per ton so total expense should be about = 815 x 5000 = £4.23 Millions. I may be wrong on this one though.

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Leaving the company with healthy profit of about 10 million pounds in the first year of production.

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I am Long on this one (came out of the position earlier and back in just before additional placing - not right timing though). I agree with Croas that share price may drift away till April atleast.

Feel free to correct me, if I am wrong in above calculation.

[spooky] 11/1/2018 16:33

Pretty hard to invest in these if we can't do that don't you think?

[shakeypremis] 11/1/2018 16:25

I don't think it's really possible to come up with a ballpark figure at the moment. There are too many unknowns.

[spooky] 11/1/2018 11:06

I take it no one knows the answer to that question.

[spooky] 10/1/2018 12:00

Does anyone know what revenues 5000 tpa equates to in likely revenues/earnings? I'm struggling to come up with a number.

[croasdalelfc] 10/1/2018 11:08

No news until April then - the basket price has gone down by 50% since Sept and marginally ahead of Jan 17.Investment case is fine but I can see a long drag back to 12p or less on no news until Quarterly update and JORC resource update

[maccamcd] 10/1/2018 07:33

lovely clear statement which guides us on all important news points we need as Bullish holders.
A great share price journey over 2018 should be expected.
Well done to team Rainbow so far!