29M - 29Metals Limited

[peter2]

While the recent Uluru waterfalls have been stunning to see, they show the amount of rain that the area has received.

29M now becomes a one asset company with the temporary closure of ESS. They've huge debt ($110M) and their AISC of copper is US$4.12/lb. Too high!. The incoming CEO has to cut costs, manage capital and get the ESS dewatered asap.

I've sold my remaining parcel (half as I sold half at 0.51) and I'll monitor this one for a reversal opp when production recommences at ESS.

There's still potential in the future for 29M if the POC rallies to the outrageous prices (>$5/lb) that some pundits state.

 

[peter2]

April 24 update: Dewatering of ESS (Capricorn Copper project) continues. Capital expenditure required to resume production.

29M has continued to progress the insurance claim relating to loss and damage suffered as a result of the extreme weather event at Capricorn Copper in March 23. Insurers issued a progress payment $24M H2 23 and another $16M recently.

Golden Grove costs increasing to $4.05/lb Cu sold (prior qtr $3.06/lb Cu sold).
No change to 2024 guidance ranges.

It's just a matter of time waiting for the weather damage to be repaired at ESS before production resumes.

 

[Craton]

Ex BHP I believe, James Palmer appointed as the new Chief Executive Officer of 29Metals, commencing on 1 May 2024. Punting that this will favourably bolster the SP.
Chosen as May 2024 stock tip.

 

[The Triangle]

Ex BHP I believe, James Palmer appointed as the new Chief Executive Officer of 29Metals, commencing on 1 May 2024. Punting that this will favourably bolster the SP.
Chosen as May 2024 stock tip.

Can I take a short position in 29M for May? 29M have old washed-up deposits which do not exactly lend themselves to "big" company BHP/RIO optimization methods. Look at the bios of management and board.... I see people used to a certain workstyle which you find with big players. They've got 1 operating mine now? and they have 12 senior managers listed on the website!!!

Other than a metal price increase - I think this company needs to focus on wheeling and dealing to get things moving upwards... Maybe use their big company connections to raise capital and buy mothballed mines. Golden Grove is old - it's only going to get deeper and more expensive to mine. Does this company even do exploration?

https://www.bhp.com/careers/inclusion-diversity/council/james-palmer

 

[Craton]

Can I take a short position in 29M for May? 29M have old washed-up deposits which do not exactly lend themselves to "big" company BHP/RIO optimization methods. Look at the bios of management and board.... I see people used to a certain workstyle which you find with big players. They've got 1 operating mine now? and they have 12 senior managers listed on the website!!!

Other than a metal price increase - I think this company needs to focus on wheeling and dealing to get things moving upwards... Maybe use their big company connections to raise capital and buy mothballed mines. Golden Grove is old - it's only going to get deeper and more expensive to mine. Does this company even do exploration?

https://www.bhp.com/careers/inclusion-diversity/council/james-palmer

Cheers @The Triangle
Thanks for the info. Yes, there are better, much much better prospects, however, chose this for the comp. on pure speculation and a play on a CU stock but don't hold.

 

[Craton]

Kept me in the fray so picking it again for the Jun 2024 Tipping Comp.

Trying to push through resistance.

 

[peter2]

May 24 update: @Craton is on the money. We have a break-out (BO-HR).
Still down YTD but not for long.

 

[peter2]

June 2024 update: The late May break-out didn't go higher as the POC fell so did all the copper stocks. We await renewed demand for copper.

No significant news this month other than finalising a $50M offtake agreement with Glencore.

 

[peter2]

July 2024 update: From their Qrtly report.

Record copper production at Golden Grove after the flood restart. Their second mine, Capricorn Copper remains suspended until they can mitigate flooding prior to the next wet season. Water levels remain above average even before the wet season starts.

I see 29M struggling for another year as capital is used to fix the water problems at Capricorn Copper before restarting production. The GG production helps them survive. Share price falling along with the copper price. Not a promising outlook currently.

 

[peter2]

August 2024 update: From their 1/2 year report.

No significant improvements noted in their latest report. Capricorn Copper remains suspended pending preps for the wet season. Cu, Zn production from Golden Grove consistent with guidance. The company is surviving but not improving.

 

[peter2]

Sept 2024 update: No new news reported by company.

However the recent rally in copper price has lifted 29M off it's recent lows.

 

[Sean K]

Sept 2024 update: No new news reported by company.

However the recent rally in copper price has lifted 29M off it's recent lows.

Looks like you'll be in the green by the end of the year on this Pete.

Pretty positive break up through the MAs on some OK volume.

Bit of a wall to bash through first.

 

[peter2]

Thanks, all part of the grand scheme in a year long comp.

I've noticed the strong demand for 29M and I'm befuddled. Other copper miners AIS, A1M have pulled back a little but not 29M.
I've not seen any news on the progress of their water containment not any other positive news.
Me thinks that others know more about 29M than moi.

 

[Captain_Chaza]

With High Respect P2---Too much thinking IMHO--
What part of the Chart do you not like?

Sailing the 29M----------One WEEK at a Time --------------------------------&-------------------One DAY at a Time

Salute and Stay Well

 

[Dona Ferentes]

Cu, Zn production from Golden Grove consistent with guidance. The company is surviving but not improving.

now $0.50

investor presentation out: less Cu, more Zn

and is this wishful thinking ?

.
Scuddles was named after a geologist Sue.
=> Harassment, these days!!

 

[peter2]

Oct 24 update: Market didn't like the Sept quarterly report as price fell 22% after the news.

The significant reduction in the copper produced was due to the lower grades of copper ore milled. Production of zinc increased and sales benefiting from a rising zinc price.

Capricorn Copper mine: 29M seems to be struggling to reduce the on-site water that needs to be treated before being released during the wet season. Production can't start until this water problem is fixed.

The recent rally in the share price was significant but seems to be born on hope rather than any news. I maintain a positive outlook for 29M but it seems there'll be another qrtr or two delay before we see positive share price appreciation. This dip may be a good opportunity for a low price entry before the next rally. I'm watching it.

 

[peter2]

Nov 24 update: Price continues to be weaker than the copper miner ETF - WIRE as it's falling more and is now close to the all time lows.

Capricorn Copper mine site has finally received EP approval to release more treated water during the upcoming wet season. If all the work done on the site since the last flood is effective there shouldn't be another flood this wet season. This will allow the mine to restart production when the wet season ends.

Further drilling shows more copper at the Golden Grove site. It may even be another production site.

29M continues to need more time until the end of this wet season. Share price should be near a level that will be supported soon.
Definitely one to watch in 2025.

 

[Dona Ferentes]

now $0.50

soon to be 27c

Highlights
▪ 29Metals launches fully underwritten institutional placement, and underwritten 1 for 1.43 accelerated pro rata non-renounceable entitlement offer to raise $180 million (before costs)
▪ Proceeds of the Equity Raising will facilitate a balance sheet reset and fully fund1 Gossan Valley to first ore (refer to ‘Gossan Valley investment decision’ announced earlier this morning)
▪ $28 million (US$18 million) reduction of total senior debt with maturity extension of senior debt to 2028 – approximately US$74 million less repayments over next 2 years
▪ $112 million of proceeds to fully fund4
the development of Gossan Valley to first ore, delivering an initial stage IRR of 34%, with potential to extend Gossan Valley Mineral Resources, which remain open at depth
▪ $40 million to progress Capricorn Copper water reduction and provide general working capital
▪ Reduction in cash outflows at Capricorn Copper are expected into 2025 as environmental compliance and water management capital projects are completed, and operating costs are reduced, to reflect lower steady state activity levels
▪ The Equity Raising will be conducted at an offer price of $0.27 per share, representing a 16.0% discount to TERP of $0.32 and 27.0% discount to last close of $0.37 per share on 02 December 2024.

.
Major shareholder participation:
▪ AustralianSuper and BUMA have committed to take-up their full pro-rata in the entitlement offer and subscribe up to $40.0 million and $62.1 million respectively, resulting in a pro forma holding in 29Metals of up to 18.0% for AustralianSuper, and 19.9% for BUMA;
▪ AustralianSuper has a right to nominate a Non-executive Director for appointment to the Board;
▪ BUMA has a right to nominate a Non-executive Director for appointment to the Board of 29Metals and has a right to nominate a second Non-executive Director should its holding exceed 20% and provided there are no more than 8 directors on the Board;
▪ EMR Capital is not in a position to participate in the Equity Raising, however, remain highly supportive of 29Metals and have endorsed the Gossan Valley expansion and reset of balance sheet. EMR Capital will continue to be 29Metals’ largest shareholder with a pro-forma holding of approximately 23.0% post Equity Raising.

 

[frugal.rock]

Currently available to buy on market at $0.255 which would be a further 5.55% discount on the already heavily discounted offer price.

Is the the offer only for sophisticated entities or is there a retail component also?
@Dona Ferentes

 

[Dona Ferentes]

Currently available to buy on market at $0.255 which would be a further 5.55% discount on the already heavily discounted offer price.

Is the the offer only for sophisticated entities or is there a retail component also?
@Dona Ferentes

bit of both


Comprehensive funding plan
- Proceeds to enable balance sheet reset via refinancing of senior debt, and to fully fund Gossan Valley to first ore

institutional placement and underwritten 1 for 1.43 pro-rata accelerated non-renounceable entitlement offer