SDL - Sundance Resources

[LRG]

excellent buying today!

I got a few more at 17.5.

I wish I was cashed up to buy more.

Big money is coming in on my indicators so I suspect it could head north soon.

As before in 2012, this is when the pay off is really going to come to all us faithful paitent holders.

I continue to back Talbot's acumen in making this another great success story.

 

[The Muffin Man]

As has always been the key with this stock, and is even more critical now during the current prevailing economic conditions, is that a strategic partner needs to be secured. This partner needs to be secured, and much more detail needs to be made public as to the final infrastructure costs, before the share price will head north with any great momentum/longevity.

For example, within recent SDL presentations, the Port figure within the CAPEX is still at $500-$600m. If you go through the articles within this thread, you will see that $500-$600m is the total cost to construct the port which SDL is in the shortlist of. The thing is though, there are many other companies on the shortlist, and SDL won't be building the port on their own. I would expect SDL to have to pay a much smaller portion than $500-$600m. However, this is the figure that is still quoted in the CAPEX of the project, being $3.2B with contingencies. I think that until there is more certainty as to who will pay for what as far as infrastructure goes, and SDL can be more specific as to what costs they will need to bare, potential strategic partners will hold off.

I don't think increased JORC resources will result in sustained share price appreciation, the above needs to happen. I think it will eventually, but the next however many months might be a little tough for holders. I'm keeping the faith.

 

[Jewels]

Has anybody been to the Sundance Resources presentation in Sydney today? If so I would love to hear what your opinion of it was, and what was said about the immediate future of SDL in respect to the current market meltdown.

 

[golfmos123]

As has always been the key with this stock, and is even more critical now during the current prevailing economic conditions, is that a strategic partner needs to be secured. This partner needs to be secured, and much more detail needs to be made public as to the final infrastructure costs, before the share price will head north with any great momentum/longevity.

I don't think you'll get many arguments on that front. But it seems like the company has been doing the right things by getting interested parties in to have a look at their plans and operation. Seems to me they are doing things right, but any SP appreciation is going to take time.

As you also stated, this is more important to any sustained SP rise than any further JORC announcements regarding what is in the ground.

 

[Jewels]

I don't think we want Sundance to make any bold announcements in the near future. The way the market is at the moment I don't think it's going to have a big influence on the share price. See CVN's announcement today.
Any thoughts Sundance Guru's?

 

[Pythagerous]

SDL down as low as 12.5c today...................

Is the sieve leaking something that I dont know about????

 

[mayk]

SDL down as low as 12.5c today...................

Is the sieve leaking something that I dont know about????

Look at the volume. Look at its peers (e.g. GBG). It is all market sentiment. People are more wary of stocks which need huge capital expenditure, and unfortunately SDL is one of them.

On a side note the volume has not been extraordinary and I won't read too much into current share price.

I have a limit order for this stock for price a bit lower though, because in an even of capitulation this baby will be hit really hard.

 

[Jewels]

Hi PI,
Apart from the global meltdown at the moment, this article may help explain what's happening, note the last paragraph. I'm using the next few months (at least 6 I expect) to top up as more cash becomes available. Don't despair too much fellow Sundance shareholders, take note of the last paragraph, although in the short term it would appear that Sundance will be heading well below 10cents.


Chinese steelmakers set to slash output
By Patti Waldmeir in Shanghai

Published: October 6 2008 19:34 | Last updated: October 6 2008 19:34

Several of China’s largest steelmakers are expected to cut output by about 20 per cent this month in a bid to support falling steel prices at a time of weakening demand.

Steel mills in northern China, including Shougang Steel, Shandong Iron and Steel, Hebei Iron and Steel, and Angang Steel met last week to discuss cuts that could total 20m tonnes, according to the state-run Xinhua news agency.

Zhang Jing, a steel analyst at Steel Business Briefing, the consultancy, said the cuts could be even larger than those outlined by Xinhua. Ms Zhang said some steel mills in eastern China would also cut output steeply, though they may not announce that they were doing so.

Jing Ulrich, head of China equities at JPMorgan, said the cuts could prove “a turning point for China’s steel industry”.

“The sharp slowdown in the property market is having a severe impact on Chinese steel producers,” she said, noting that the property sector accounted for 38 per cent of steel industry demand. She quoted Xu Lejiang, the Baosteel chairman, as telling a recent industry conference that the era of rapid steel industry growth “will soon be remembered as history”.

Chinese steel consumption rose 16 per cent in the first half of 2008. Since then, the three main industries that consume steel in China – construction, household appliances and the car industry – have all shown signs of a slowdown, say industry sources.

Steel output across the industry had been falling slowly since June, even before the news of further steep cuts, said Zhou Xizeng, steel market analyst at Citic Securities, with some factories forced into a loss-making position by low prices. Crude steel output declined 5 per cent month on month in August, to 43m tonnes.

However, most analysts expect a recovery in demand in a few months, as government policy shifts focus from fighting inflation to supporting economic growth in the face of a global slowdown.
Copyright The Financial Times Limited 2008

Hope this explains it PI, All the best J

EDITOR’S CHOICE
Steel outlook falters as demand falls - Oct-02Lex: Chinese steel - Sep-30Chinese steel consumption set to fall - Sep-03Nymex to offer steel futures contract - Aug-04Steel price nearly doubles in year - Apr-27LME seeks profitable billet with steel contracts - Jan-15Shares of Angang Steel fell by their 10 per cent daily limit in Shanghai trading in response to the reports of output cuts.

 

[Jewels]

Sundance have just announced that they have picked up two new tennaments in Congo abbutting their tennaments in Cameroon, go to the asx website for full details.
What was I saying about announcements in this market?

 

[The Muffin Man]

Aye, it will definitely fall on deaf ears at the moment. A good announcement for the company's future though, I'd awalys wonered how much potential was on the other side of the border. I guess we will find out soon enough.

I'm not confident of any investment from possible strategic partners for quite some time though, especially seeing the news out of China and Europe. Hopefully these rate cuts and falling oil prices can, at some point, help re-stimulate World demand and give everyone a little confidence boost.

Still holding but copping a pounding!

 

[LRG]

Lucky my mindset is still to wait until post production 2012+

i.e long term holder, I bought another 50k of the shares today at 8.6c.

My average price is now 21cents. I can't keep dipping into borrowings to average down.

The announ is an attempt at more positive news.

They are going to have to ann how the thing is going to be funded and if there will be any delays now to 2012.

I dont believe Talbot would walk away from this - I have to keep buying now below my avg as my cash is available - in too deep.

On the basis that this will get up in the future, as the price heads back to 40c I can sell down some of my shares to free ride it a bit from there.

I hope us SDL long termers are right, or this will hurt me bad and others if it collapses.

Evertime I read stuff on the SDL website - i think how much expertise, how big it is, how much $'s are involved and I think this is going places; everytime I see the SP over the last few weeks I think, this must form a base please.

I am going to do well in 2012 if it hits $5+; but I am going to be in deep losses now if it goes to $0.

Other holders - what is your avg, why do you hold the faith still - are you going to bale???

 

[Lucky_Country]

I think that things may even get better for SDL due to the fact that other companies that were one step ahead in expansion and development plans have now had to postpone their plans until the credit markets pick up.
That gives SDL the chance to pull level on plans and become a prime candidate for funding when lending is available again.
Demand in IO has slowed and may continue for some time but by the time SDL are in production it will be rampant again.
Yet still havent heard the company say anything about postponements or delays and thaey have until mis next year for funding and development to start.

 

[golfmos123]

I agree with the last 2 posts. SDL will have some major advantages over other IO projects once they get closer to the starting line, especially re funding the project and locking in customers. It is difficult to see that it won't succeed, the trick is getting past all the SP pressure at the moment and maintaining a decent level of stock. There will be more dilutions to come as they invite new companies into the fold too.

Couldn't resist late last week and picked up another small parcel around 8c. Don't have much cash left but think this one will reward me well later on.......

 

[Goldmann]

excellent buying today!

I got a few more at 17.5.

I wish I was cashed up to buy more.

Big money is coming in on my indicators so I suspect it could head north soon.

As before in 2012, this is when the pay off is really going to come to all us faithful paitent holders.

I continue to back Talbot's acumen in making this another great success story.

Talbot also owns some 15%+ of Riversdale Mining, which has dropped from over $10 a month ago to now around $4.50... so not all he touches still turns to gold... it does give some confidence long term though...

 

[Jewels]

Just wondering what the more sophisticated investors are thinking. Now that Sundance has tennaments in another country, does this increase the political risk? (My impression is that the Congo lacks the political stability of Cameroon). Does it increase opportunities for funding through cheaper lines such as Government backed securities and increased allocations from world bank? Does it have any implications tax wise? (bearing in mind SDL is expected to receive considerable concessions from the Cameroon Government). Will it be more economical to ship the ore out through a differing railway to another port further south?
Any comments folks?
ThanksJ

 

[The Muffin Man]

Well, yesterday and today (so far) have helped make the SDL picture a little easier on the eye.

Jewels, I'd agree with your analysis that the Congo presenta a riskier project than Cameroon. I can't see the planned rail and port projects changing though. I would have thought the deal to acquire the two most recent licences would have been in the pipeline for a while, and SDL has still been pressing ahead with the Cameroon Government regarding the construction of the port.

I wonder how many SDL holders that considered themselves long term investors sold out of the company over the past week from pure panic? I'm not suggesting the volatility is over but heres hoping we don't get into the 8-9c bracket again any time soon!

 

[RP_Automotive]

I've been a SDL holder for over a year now, and follow this thread quiet alot. Thankyou for all the great discussion...and sorry that I dont have anything good to input.

Last week I was one of these 'panic' investors and sold @ .17c.....with every intention of getting back in. I was just scared that things were melting down too quickly....I brought back in today @ 15.5c. My intention is to sat y for the very long term...

I am a little skeptical about the latest lease buying by SDL. I havent taken the time to read it in depth, but from what I have read its just another tennament that needs to be drilled?? Personally I think they should spend more money/time on getting the current project off the ground and keep things sweet with the Cameroon gov - As the Cameroon gov seems to be very welcoming to SDL. For them to take their business over the border, waste money doing more drilling etc etc to me is just driving the company into more debt/uncertainty. maybee im wrong, and SDL find another 1.75b of iron ore????

 

[The Muffin Man]

RP, the way I would look at it, and the way the Cameroon Government would look at it too I would think, is that the more natural resources that are found in that area of the World, the more likely it will be that projects will get off the ground.

Say for instance, SDL were to find another 250m tonnes of DSO across the border (just an example plucked from the air) This would further encourage investment in the area, and would make the Cameroon/Congo project much more attractive to prospective investors. The sites are close enough to use basically the same infrastructure, meaning the more they can find there, the more attractive the project will become in the long term with regrads to return on investment, payback period etc. The full cost of developing the area could be spread further across larger amounts of resources making it all the more attractive.

 

[Jewels]

Sundance have today announced they have a further 2 year extension to exploration permit No 92. Included in the permit is the ability to look for gold.
What are the chances that Sundance will become a gold play over the next 12 months??
If you're interested it's on the ASX website, haven't checked Sundances website yet, but it's probably on that also.
Ciao J

 

[mayk]

During that panic I picket more SDL at 8.7 cents. I was kind sorta waiting for that panic to happen. Was really a very good opportunity. Wish I had more spare cash. I diversified the money in many stocks so could not buy more. Still happy with my pick though.


On the topic of acquiring license for Congo, not really thrilled. On the subject of GOLD very happy