Woodburne Sq Share Discussion Threads

[keya5000] 11/3/2012 19:56

When you compare this to some of the Canadian and Australian listed graphite miners we are very much undervalued.

The majority of these plays are only at the pre BFS stage and production from their projects is not guaranteed, however we are in production in Q2 with a 15% share coming our way at a massive discount to the comparable market caps on a percentage basis.

There must be a detailed resource estimate etc on this project and I would love to see the detail, I would expect we will be very pleasantly suprised.

Like others say this could also be just the tip of the iceberg.

Perhaps the most exciting resource play on AIM at present in my opinion.

JoJo---

Off topic but I believe you hold some CSH also? I have tried to get some info on the drill schedules/progress to no avail, have you heard anything???

[jojo_jo] 11/3/2012 19:40

Thanks. MK is still involved and, like engelo said, dealing with legacy items from the bad old days. A tax refund is a few years out, and should only be regarded as a possible windfall, so is best discounted.
IMPO/DYOR.

PS. I think we'll get an update RNS as soon as they get back, having (hopefully) locked in a bigger stake.

PPS. With a higher value product like graphite/graphene the only logistics infractructure requirements should be lorries, roads and ports.

[xcap] 11/3/2012 19:28

thanks chaps.
JoJo_Jo, post 790: "MK I spoke to before the meeting opened:..." presumably MK is the reference

We really do need an update and a company presentation covering the Graphmada operation.

[jojo_jo] 11/3/2012 19:22

dosser2, just hang on mate - this will be 15p before you know it! IMPO.

[engelo] 11/3/2012 19:22

Jo-jo: thanks for pointing out that world geography is on our side: I'd been vaguely thinking that our location was a bit of a minus. Within Madagascar, I'd been thinking/hoping that in order for Grafmada to go into production in Q2 the logisitics must be OK, and we wouldn't suddenly find that a railway to the port needed to be built! A map of Madagascar with Grafmada's location on it would be nice: could ask the dirs when they get back as only they know where it is :-).

[jojo_jo] 11/3/2012 19:20

engelo, I had another look at your EGM summary (post 790) but couldn't find any mention of Kiersnowski. Am I missing something?
Jo.

[dosser2] 11/3/2012 19:16

5p still sounds good to me, esp as I paid more than 5p for ths share.

[jojo_jo] 11/3/2012 18:44

Good research xcap (and nice to see a new heavyweight 'digger' in the fold).

Graphite/graphene is clearly 'tomorrows gold', which is why the directors no doubt want to tie up a bigger stake asap, perhaps even a controlling one. Several of us now have come to a valuation of £7-£8m for the existing stake, based on comparisons with peers. It is obviously going to take a combination of our (on tap?) finance and the intrinsic resource to create shareholder value. We also have a ready buyer or two in the wings. I'd be happy with a 60% stake, but 35%-45% is more realistic.
Like xcap implies this could generate double the profits I (conservatively) suggested above. If we had a decent amount of pure (99.9%) graphite, we're looking at a much, much bigger resource valuation and op/np figure. Geographically easy to manage, with ConsMin companies in S.Africa. Logistically excellent too, within easy reach of Suez, India and Brazil.
Fortunately I don't see a a Madagascan flag in the counter! Grafmada was a very good find, well done bod.

IMPO/DYOR.

[engelo] 11/3/2012 13:21

xcaP: Kiersnowski is on this case, and they must have some hope to keep him on. See my EGM notes.

[xcap] 11/3/2012 12:31

From dosser2 post 451: TW "There is one other potential bonus here. The company may or may not be due a tax rebate in France in 4 years of up to 5p per share. We are investigating this closely and we reckon the odds are against it but it is just possible that there is a windfall gain to be enjoyed here as a bonus".

if anyone's to have a chance of fighting for a refund, with his specialist corporate expertise and knowledge, it is GS. unlikley, but you never know....
i have no idea as to the background circumstances of this 5p refund?

[engelo] 11/3/2012 11:35

xcaP: thanks for this stack of info. Yes, do get up later than you on Sundays :-)

Have you looked at the graphene connection? Honestly don't know the impact of it but it's an amazing story. Plenty out there but try

[xcap] 11/3/2012 09:53

fascinating article imo.

don't know what to pick out as highlights but what about this:

"Fortunately, graphite reserves are present around the world, though many sites would require several years of development and significant investment to begin production. Countries known to have reserves of highly valuable flake or crystalline graphite include Austria, Norway, Germany, Italy, Madagascar, Sri Lanka, Russia and Canada".

[xcap] 11/3/2012 09:44

"Graphite and Rare Earth Metals for the 21st Century: Jack Lifton
TICKERS: FMS, NGC; NGPHF, SER
Source: The Critical Metals Report Editors (2/7/12)
The list of once-obscure metals and minerals that are becoming "strategic" seems to be growing daily. However, population growth and rising living standards in developing countries are driving demand for most raw materials. In this exclusive interview with The Critical Metals Report, Institute for the Analysis of Global Security Senior Fellow Jack Lifton explains how increasing demand and harder-to-mine deposits are raising prices on these essential materials.

COMPANIES MENTIONED: FOCUS METALS INC. - NORTHERN GRAPHITE CORPORATION - STRATEGIC ENERGY RESOURCES
The Critical Metals Report: In the last five years, investors discovered lithium and the rare earths. What will be the next big thing?

Jack Lifton: The answer is graphite. Graphite has traditionally been considered a boring, mundane industrial mineral, evoking thoughts of pencils, golf clubs and tennis racquets. Investors should think again. Traditional demand for graphite in the steel and automotive industries is growing 5% annually, and graphite prices have tripled. New applications such as heat sinks in computers, lithium-ion batteries, fuel cells, and nuclear and solar power are all big users of graphite. These consumers are beginning to place substantial demands on existing production-and over 70% of that production is from China, which is no longer selling this resource cheaply to the rest of the world as the country's easy-to-mine, near-surface deposits are becoming exhausted.

Graphite's criticality and potential scarcity has been recognized by both the United States and the European Union, which have each declared graphite a supply-critical mineral. Recently, the British Geological Survey ranked graphite right behind the rare earths and substantially ahead of lithium in terms of supply criticality. Clearly, there is much more to graphite than pencils.

TCMR: What about graphite makes it so important to all these end-users?

JL: Graphite and diamonds are the only two natural polymers of carbon. Both are very strong, can withstand extreme heat, and resist attack from chemicals and corrosion. While a diamond is a three-dimensional crystal structure of carbon, graphite possesses a two-dimensional flake crystal structure. Graphite is also a very good conductor of heat and electricity. Due to its amazing chemical and physical properties, new industrial, commercial and high-technology uses for graphite are constantly being discovered.

The lithium-ion battery is one of the fastest-growing uses of graphite. Each one actually contains greater than 10 times more graphite than lithium. These batteries are already widely utilized in the consumer electronics industry in devices like mobile telephones, laptop and tablet computers, and media players.

Other new technologies like fuel cells, will also drive demand. Fuel-cell-powered forklifts are in use in American warehouses. Some fuel-cell-powered taxis and buses are already found on city streets, and most major car companies will join Hyundai in producing fuel cell vehicles by 2015. To be clear, electric and fuel cell vehicles will not replace the internal combustion engine, however, they are part of the solution to reducing dependence on non-renewable energy resources and make a great deal of sense in many applications. Telecommunications companies are employing fuel cells around the globe for primary or backup power at cell phone towers and substations. A range of facilities, including stores, universities and business parks, are also using this clean, efficient technology for low-cost power that works independent of the grid.

Fuel cells convert chemical energy from a fuel source, often hydrogen but also natural gas or even an alcohol like methanol, that chemically reacts with an oxidizing agent like oxygen to create electricity. Because they operate at relatively low voltage, fuel cells are typically placed in series or parallel circuits to increase voltage and current. Fuel cells generate fairly low levels of emissions, as well as water and heat. In large installations, this heat can be captured and used for climate control and to produce additional power through cogeneration.

General Motors has already invested more than $2 billion in automotive fuel cell research and development, and is believed to be seeking additional investment from industry peers in exchange for rights to use the technology. German automotive companies BMW and Volkswagen both own stakes in SGL Carbon SE, the world's largest maker of carbon and graphite products. Just how much graphite will be required for fuel cells? The proton exchange membrane fuel cells being developed for use in cars would require 100 pounds of graphite per vehicle. The U.S. Geological Survey noted in 2010 that "large-scale fuel cell applications are being developed that could consume as much graphite as all other uses combined."

Graphite is also projected to be a key component in next-generation nuclear reactors, which are expected to reach temperatures of 1,000 degrees Celsius-triple the temperature inside today's commercial reactors. Graphite is one of the few substances that can resist such heat, with initial tests by researchers at the Idaho National Laboratory indicating that it can actually absorb heat as high as 3,000 degrees Celsius. Pebble bed nuclear reactors are small, modular reactors that are safer than conventional reactors because they "die" on their own when shut down. They are fueled by tennis-ball-sized graphite spheres with uranium embedded in them. Substantial amounts of graphite are required to charge the reactor at startup, and a percentage of the balls must be replaced each year as the fuel is spent, which creates ongoing demand for graphite. China has an operating prototype and is now building the first two commercial units, with plans to have 30 by 2020. These reactors are one of the top 16 priorities in China's 2020 strategic plan.

The vanadium redox battery, which offers great potential for storing excess energy generated by renewable energy sources like wind turbines and solar cells, is another notable emerging technology that would require significant amounts of graphite to produce. These batteries, which offer significant storage capacity, long life, low maintenance requirements, and a nominal environmental footprint, require some 300 tons (t) of flake graphite per 1,000 megawatt of storage capacity.

TCMR: Isn't there plenty of graphite in the world to go around?

JL: Natural graphite deposits can generally be characterized as one of three types: crystalline flake, amorphous or lump, also known as vein graphite. Total annual global graphite production increased substantially in the 1990s as China dumped graphite on world markets. Prices crashed and exploration and development in the rest of the world ceased. Production has now held steady for several years at approximately 1.1 million tons (Mt) as China appears to have reached the limit of its productive capacity and the commodity super cycle has soaked up excess supply. Since 2005 prices have basically tripled, and supply is tight.

Graphite mining and processing is currently limited to a small handful of countries, with China, India, Brazil and Canada the leading suppliers. Only 40% of world production yields flake graphite, the most desirable type for its suitability in high-value, high-growth applications. Only flake and synthetic graphite, which is made from petroleum coke through a very expensive process, can be used in lithium-ion batteries, the current demand driver for this crucial substance.

321energy.com owner Bob Moriarty recently commented, "If you believe in lithium-ion batteries, you would do far better by investing in a good graphite company than a good lithium company. . .With demand for graphite growing at 50% per year and prices reaching $2,500-3,000 a ton, the future for graphite companies with actual projects is excellent."

TCMR: What about the introduction of graphene, single-atom-thick sheets of crystalline flake graphite? How will the use of this material in phones and touch screens impact demand?

JL: Professors Kostya Novoselov and Andre Geim of the University of Manchester were awarded the 2010 Nobel Prize in Physics for their work with graphene. British Chancellor of the Exchequer George Osborne recently committed ~$80 million (M) to graphene research, a quest embarked on by almost every major research center and university as well as hundreds of companies, from IBM and Intel to Silicon Valley startups.

Graphene is being studied for use in ultra-high-speed microprocessors, as it conducts electricity at a rate 30 times faster than silicon. IBM is examining whether graphene's magnetic traits will allow it to be utilized in medical devices to spot diseases in their earliest stages. The company is also working with the U.S. Department of Defense's Defense Advanced Research Projects Agency to investigate whether graphene can improve mobile phone efficiency, wireless signal clarity and radar quality. Nokia is researching graphene's potential use in cell phones and touch screens, with the latter usage expected to become commercialized relatively soon, potentially in a foldable phone. One U.S. Department of Energy researcher believes that graphene's energy storage potential will lead to the development of batteries that will triple the range of today's electric vehicles without increasing battery size or weight.

In collaboration with South Korea's Sungkyunkwan University, Samsung researchers have created a flexible touchscreen several feet wide from "printed" graphene that could eventually be commercialized in strong, lightweight, flexible solar cells, touch sensors and flat-panel screens, perhaps maybe even directly integrated into clothing. While research-and-development activity is moving from university labs to corporate workplaces, scientists estimate that the first commercial applications of graphene technology are 5 to 10 years away.

TCMR: If the price goes too high will manufacturers simply engineer graphite out of their products?

JL: At the recent Graphite 2011 conference in London, Colin Cooper of Graphexel Ltd. said "new technologies [are] unlikely to overtake the graphite market demand for traditional end uses-such as refractories, metal casting, and lubricants-as the fundamental need for graphite in these lower value sectors [is] not going away." However, these traditional industrial users will find themselves competing for supply with those producing new technologies as there are very few, if any, economically feasible alternatives available and very little recycling of graphite.

The main technology that these traditional uses will be competing with in the near term is rechargeable lithium-ion batteries. Graphite serves as the anode in lithium-ion batteries, and there is no substitute for it in this application. Due to their advantages relative to other battery types-including their comparatively light weight, lack of memory effect, slow self-discharge rate and environmental safety-the lithium-ion battery industry is growing 30 to 40% annually as products such as power tools, consumer electronics, and hybrid and all-electric vehicles switch from other, inferior battery technologies.

Already, plug-in electric vehicles like the Chevy Volt, Nissan Leaf and Tesla Roadster rely on lithium-ion batteries, and the gasoline-electric hybrid models that have used nickel-metal hydride batteries for the past decade are making the transition to lithium-ion technology. The electric vehicle market is expected to grow as much as 20% annually by 2020, with expectations that between 3–6M such vehicles will be manufactured in 2020, each of which will require approximately 40 pounds of graphite for the battery system alone. Both U.S. President Barack Obama and Chinese leaders have stated that they want to see 1 million electric vehicles on the roads by 2015. An estimated 1 Mt additional graphite will be needed annually by 2020 for electric vehicles and other emerging applications.

TCMR: If current annual flake production is around 400,000 tons, where will all this new production come from?

JL: This booming demand will require more than a doubling of current global graphite production to meet the needs of traditional markets like North America and Europe, as well as such emerging markets as China, India, Russia and Brazil. Total graphite production across the globe has been consistent in recent years at approximately 1.1 Mt annually.

China's production is suitable only for industrial applications such as steelmaking and lubrication rather than high-tech uses like batteries and graphene. China already imports a significant amount of the graphite mined in North Korea.

Fortunately, graphite reserves are present around the world, though many sites would require several years of development and significant investment to begin production. Countries known to have reserves of highly valuable flake or crystalline graphite include Austria, Norway, Germany, Italy, Madagascar, Sri Lanka, Russia and Canada.

Governmental bodies have shown increasing concern about graphite's importance. The U.S. Department of Homeland Security's Critical Foreign Dependencies Initiative lists Chinese graphite mines as essential sites that would damage American interests if attacked. Graphite was also determined to be high in terms of both economic importance and supply risk in a 2010 European Commission study of 41 raw materials....."



theaurreport.com

[xcap] 11/3/2012 09:03

clearly everyone's gone to the 8 o'clock mass! i was let off today, bit of a late night....

[xcap] 11/3/2012 07:37

btw, when the new thread is created I really feel that we should keep all the posts from Jan 1.
For all those researching this company I strongly suggest you read from Jan 1 and you will quickly appreciate why we are so positive about this company.
All imho.

ps Graphmada is of course only one of many investments the Board are no doubt running the rule over. I really want to know what precious metal investments we have left on our balance sheet. Can't see why this would not be disclosable, unless the BoD are currently using them as collateral in exchange for new investments??
again imho

[xcap] 11/3/2012 07:21

ignore post 987 it had the less than sign which ADVFN does not recognise and deletes whatever follows.

[xcap] 11/3/2012 07:20

JoJo

from the Northern Graphite website, Feb 12 Presentation

Project Parameters:
CDN$70-80 MM capital cost
• 2,500 tpd processing rate
• 19,000 tonnes of graphite produced per year
• less than0.50 waste-to-ore ratio
• Cash cost of $1,000 per tonne
• 40 year life-of-mine with expansion potential

From Focus Metals Website, Presentation

Targeting ~20,000 tonnes annual
production (95% - 97%)
– Cash costs expected to be ~$350/t
• Versus $800 to $1,500/t for most
competitors
• Potential to add ~3,000 tpa high
purity (99.99%) graphite
– 99.9% and 99.99% purity graphite
needed for battery use
– Sells for an average of $20,000 up
to $40,000 per tonne depending on
customer specific requirements
• Simple graphite ore processing
– Crushing, flotation, screening,
drying, and bagging
• Pit limits extend to 125 metres


JoJo (re above)
Cash costs at FMS are projected to be $350 per ton! @ $3000/ton that's an operating margin of 88%.
Plus note where large flake purity hits 99% the price/ton can be as high as $40,000

Graphmada:
Truth is we simply don't know what our cash costs are, according to the above , these could be $350/ton to $1,000/ton, but even if conservative at say $1500/ton that's a 50% op margin!
We (shareholders) have no clue what our resources are, they are probably be much bigger and no doubt further exploration will happen, sourced through internal cashflows (it would be nice to know the LOM, that would give us a clue about current resource)
The mineralistaion is likely to be open in all directions and at depth
We already have high quality flake so may hold very high flake purity (up to 99.99%) selling between $20,000 and $40,000 per ton
We DO KNOW that our operation will be in production in Q2 ramping up to 12,000 tpa 2 years ahead of Northern Graphite and Focus Metals. They have yet to raise finance and in these difficult capital markets (while the capex is small relatvley speaking) is going to be difficult and I suspect put projects back 6-12 months. A positive for Graphmada.

What we do know is that we are looking to increase our stake in Graphmada and that can only suggest that a very sound and promising outlook in respect of
resources and mine life
quality of flake
off take
cash costs, especially if we are able to increase production to 15 or 18,000 tpa in a few years
If, as we all agree, ConsMin, are very much involved here, all the above is very and highly likely as part of the investment outlook WSAG have for Graphmada.

EDIT: Oh, and I forget, NGC mcap £41m (not yet in production), and FMS £52m (not yet in production) and they both have much higher TP set in the broker notes. This means at an av mcap of £47m, our 15% interest should equate to an mcap of £7m = 11p just for starters (remembering FMS/NGC are not near term (2 months away) producers, and the 11p only relates to the 15% stake in this single asset, which is is to be increased and takes account of no other asset on our balance sheet, the possibility of future investments and of course whatever ConsMin have in store!).


I really hope WSAG will do a Co Presentation and give us much more detail about this operation. We need to know the structure of the current deal and what we have to do to increase our stake in Graphmada to 45%.

I am so glad I am in. What a fantastic prospect we have here. I wonder what next week has in store for us.

The above are my personal views and please dyor.
regards

[xcap] 11/3/2012 07:19

JoJo

from the Northern Graphite website, Feb 12 Presentation

Project Parameters:
CDN$70-80 MM capital cost
• 2,500 tpd processing rate
• 19,000 tonnes of graphite produced per year
•

[jojo_jo] 11/3/2012 02:06

I'm still totally convinced ConsMin (poss. c/w Global Gold) have big plans for StratMin. However even ignoring this, a 45% stake in Grafmada would produce around £10m in turnover for us. Not sure what margins will be like, but assuming they will be at least 30%, we should get £3m pa in profit on the holding. At 6x, the Grafmada investment alone should add nearly £18m to WSAG's (StratMin's) market value. Production due to start Q2 2012 (ie very soon). Let's hope they can build the stake up to 45% or higher, and that is the reason for the directors visit to Madagascar, and possibly South Aftica where Bogolyubov has a few operations.
We have a ready-made buyer for the graphite in the form of Abramovich's EVRAZ (where Bogolyubov sits on the board). Apparently Bogolyubov, who is based in London, also intends listing his Privatbank on the LSE this year. Oil producer Ukrnafta, in which Bogolyubov holds a 10% stake, is also preparing to IPO. Personally I think he'll be quite keen to ex-patriate some of the proceeds.
Clearly funding will never be a problem for any venture he chooses to get involved in.

IMPO/DYOR.

[xcap] 10/3/2012 13:52

Engelo yes have done so. I initially started my reading (twice!) from 12 Jan (the RNS release of strategic review), but last night went back to 1 Jan. I hadn't realised that ConsMin only entered the register on 5 Jan, there I was assuming they were there from the TW days. The level of research you guys have done is unbelievable.
I have no views presently regarding the RTO idea. I need to understand it a bit more before forming a view. I appreciate that is what Nat Rothschild has done with GENL and BUMI, and look at their mcaps!

The ConsMin connection:
1. Clearly a strategic holding
2. With a 21% holding a seat on the Board has to follow, this would then provide formal strategic direction and operational execution not to mention the vast resources WSAG would have access to (human and otherwise), and this is what the market will like it would be the formal stamp of approval and will add a serious amount of value to our mcap
3. Remember also that with AUM's 4.82% (if they are aligned with ConsMin) they would have over 25% voting power which means much greater rights in calling for special resolutions (which I suppose does/could add to the RTO idea)
4. I think ConsMin must have been in the background supporting GS for sometime before the shake up. You don't just get the 5 Jan RNS and a week later issue another announcing a stake in a graphite operation in MAD without the confidence and support of a stakeholder such as ConsMin, infact I think they would have unofficially "rubber stamped" it. GS is no doubt very bright and has taken a crash course on commodities, but you cannot make material operational investment decisions of this nature without a whole team involved assessing
a. quality of asset and its operations
b. the management
c. assessment of off take agreements - no point in producing 12k tons if they have not secured a market
d. geological reserves and resource, grade, cut off and all the other technical and engineering aspects of the mining operation and investment..... (would GS honestly know or have the skills and expertise to sign off the resource as being verifiable on behalf of the WSAG Board and its shareholders - i think not, i think there would have been a team of helpers on hand from ConsMIn)
d. obviously the list is not exhaustive
edit: apologies, engelo your post 981 address' this point

But, having written the above, I am asking myself, if ConsMin have done all this to support WSAG where's the benefit to them, why not just deal directly with Graphmada. I've stopped dead in my tracks because it lends much more credence to the RTO idea or their ultimate goal of creating a company with subsidaries operating in critical and strategic metals to list them separately with controlling interests. I think I have lost my train of thought now and am rambling on a bit... forgive me if the above no sense at all. All I know, and I am merely reflecting what has been said already: this is a hell of a fascinating
story that is unfolding. And one thing I am confident about is that we have a very able CEO and there is clearly something (good) going on in the background viz vie ConsMin. I copy Engelo post 790

- All directors are shareholders and share the same interests in the share price going forward, and
- By the end of the year GS expected shareholders would be extremely pleased with the developments currently envisaged

All imho

[backwoodsman] 10/3/2012 12:48

Thanks, Engelo, and sorry I missed that pointer. It was probably posted as I was doing my own 'research'.

[engelo] 10/3/2012 11:25

Backwoods: have you followed up post 979? Think we were posting at the same time.

[anointedone] 10/3/2012 11:25

Just seen on Sky News property has gone up 500% in the las 25 yrs.
Our new CH investor will make that in 6 mths.
I can see much more of this I.e property developers moving into commodities & PMs.