CTM - Centaurus Metals

[Miner]

Dunno. Went up at 11.52. Not much new in the speech and preso. Thankfully no further delays announced. $23m cash as at 31 Mar. Spending about $10m a quarter. Going to have to raise again very soon to get to at least the DFS.

The AGM presentation is now on ASX. Probably market has seen the financial load coming and hence the price is depressing

https://www.centaurus.com.au/site/showdownloaddoc.aspx?AnnounceGuid=009a452a-714b-4cc6-b75a-f8600f267b87&TE=barunea@gmail.com

 

[mullokintyre]

Hit a 52 week low this morning. Have put some low ball bids in in case it falls father.
Mick

 

[Sean K]

Here's a part explanation for CTMs shocker this year, so far. There was always a forecast for a surplus this year due to Indonesian output and back into deficit in the next 2 years, but this has been a killer to the PON thus far, and to CTM in 2023.

While Indonesia's product is very CO2 intensive, it doesn't seem to have stopped people buying it (China and Korea) who care less about emissions. I daresay it will be North America and Europe who will be ultimately buying CTMs low CO2 Ni sulphide product, probably all from Vale.

In the meantime, while Indonesia keeps lifting output and people are willing to buy it, it's going to be short term trouble for CTM I think.

 

[Sean K]

On a positive note, Argonaut have increased their valuation from $1.65 to $1.95, but I think they're in bed with them.

Haven't got the full report, I stole this screenshot from somewhere else.

 

[Miner]

CLEVER way of manipulating to get more shares by the EMT than committing a price to convert the options.
Minority shareholders can only watch

 

[mullokintyre]

up 10% this am after announcing that they had bought out the offtake agreement with Vale.
The small parcel I had picked up with my partially filled low ball bids got taken out at the open.
A small profit, but butter than a loss.
Mick

 

[Sean K]

up 10% this am after announcing that they had bought out the offtake agreement with Vale.
The small parcel I had picked up with my partially filled low ball bids got taken out at the open.
A small profit, but butter than a loss.
Mick

This agreement and sp response is a good indication of what will happen when they actually get an offtake agreement, IMO.

On the other hand, not sure why Vale wouldn't want the guaranteed offtake from Jaguar to add to their other supply.

 

[Sean K]

Update from Argonaut due to the recent transaction of two mines in Brazil that allow for a value comparison with Jaguar.

Still comes up with a MC of triple the current price, or nearly 2 bucks a share.

Time will tell.

Will be another dilutive CR coming up soon to get them to the DFS. Unless a major steps in to inject equity and form a JV, or they're taken over before the DFS.

 

[Miner]

Update from Argonaut due to the recent transaction of two mines in Brazil that allow for a value comparison with Jaguar.

Still comes up with a MC of triple the current price, or nearly 2 bucks a share.

Time will tell.

Will be another dilutive CR coming up soon to get them to the DFS. Unless a major steps in to inject equity and form a JV, or they're taken over before the DFS.

View attachment 158400

DNH
Speculatively further offtake guarantee and acquisition by Vale could be an opportunity.
All it needs Next Investors to publish a juicy rumour .

The volume on Monday was spectacular

 

[Sean K]

The old Sprott guys are now called SCP Equity Research and have lowered their price target from $3.10 to $2.30, reasons explained below.

Sprott own 9% of CTM, so....

It's worth reading SCPs full analysis beyond the front page summary to get a better feel for how they come up with their numbers and the comparisons with other assets to see why they're so bullish on this.

 

[Sean K]

Wyloo taking over MCR for $760m.

MCR total resources stand at 5.9Mt @ 3.8% for 223Kt Ni.

CTM EV currently $400m ish.

CTM total resources stand at 109Mt @ 0.87% for 948Mt Ni.

Mr Market will wake up eventually.

 

[Sean K]

In TH for CR as was expected. Hopefully not too dilutive. On the back of some good drilling results as is the usual play. Should easily get us to DFS. After that, they should be looking at overall project financing.

Quarterly out as well, but nothing new there. Will be interesting to see what comes out of negotiating off-takes.

Left field for funding will be a JV partner, royalty-streams, or a complete takeover.

 

[Miner]

In TH for CR as was expected. Hopefully not too dilutive. On the back of some good drilling results as is the usual play. Should easily get us to DFS. After that, they should be looking at overall project financing.

Quarterly out as well, but nothing new there. Will be interesting to see what comes out of negotiating off-takes.

Left field for funding will be a JV partner, royalty-streams, or a complete takeover.


View attachment 160172

@Sean K - you are on the money on this for sure "Left field for funding will be a JV partner, royalty-streams, or a complete takeover".
Personally I do not believe CTM has the capability or willingness to continue the project beyond DFS- because the DFS is yet to be completed and the CAPEX is to be announced. Last time the delay was attributed to ALS. Secondly, no visibility on environmental permit.
The nearest contender for the takeover is VALE. Probably Vale will say yes but when? There are lot many strong points on the ore body, location and infrastructure for sure. The major shareholders are ready to encash their holding as soon as a JV partner gets announced. But when?
DNH

 

[Sean K]

@Sean K - you are on the money on this for sure "Left field for funding will be a JV partner, royalty-streams, or a complete takeover".
Personally I do not believe CTM has the capability or willingness to continue the project beyond DFS- because the DFS is yet to be completed and the CAPEX is to be announced. Last time the delay was attributed to ALS. Secondly, no visibility on environmental permit.
The nearest contender for the takeover is VALE. Probably Vale will say yes but when? There are lot many strong points on the ore body, location and infrastructure for sure. The major shareholders are ready to encash their holding as soon as a JV partner gets announced. But when?
DNH

I think the 'strategic partnering process' is going to be very important here. I think it's currently a little small for a BHP type to run with it but perhaps an S32 might be interested. Perhaps Wyloo, but not sure if they're comfortable in NE Brazil. Maybe it's just an off-take agreement for cash up front to provide the bulk of the capex.

 

[Sean K]

CTM is still staggering around that CR price unfortunately. Not sure how long that gets flushed out and forgotten about.

I think the price of nickel has had a significant effect on CTM this year. Down to $20K from $30K which I was hoping to be a new normal, but Indonesia (China) and the Philippines got in the way with increasing production causing an oversupply.

Not sure what the DFS price assumption is going to be based on. I think the last feasibility study was based on $14K ish. I assume they will use three assumptions in the model, unless they lock in some off-take agreements in the mean time on longer term contracts. Not sure if that's the way it'll go or be at market prices. Pretty sure off-takes will be part of the strategic partnering process.

They're taking a long time to get all these studies done considering they had enough nickel in the ground long ago to build a mine. But, perhaps the delay will mean they get into production at about the same time as the projected nickel supply demand crunch around 2025-26 (see graph below). Unless of course Indonesia and Philippines just ramp up their laterite production. I don't think the Chinese care too much about CO2 implications of the production of laterite deposits. But, Nth America and European EV car makers will be much more concerned and will be going for the sulphide which CTM will produce.

I'm hoping the DFS is not delayed again and it's out before the end of the year to save my performance in the yearly stock picking comp. CTM letting me down. Hopefully the DFS surprises to the upside. I'm concerned capex will blow out, but the production rate and LOM will significantly improve on the SS which was pretty good as it was.

 

[Miner]

I have speculation that all quiet from 1 Ord Street West Perth for some times post CR and DD presentation on DFS scope and progress is interesting.

 

[Sean K]

They must be getting close to announcing the strategic partnering plan, unless it comes out with the DFS. But, if they finalise something it will be material to the market so they probably can't hold that a secret. The two statements I've underlined in their interim financial report contradict each other a bit. Firstly they say the process has concluded and then they they've started discussions?? It's one or the other.

I'd anticipate getting a major miner or off-take agreements from a major car company(ies) for funding the capex will be a significant catalyst in the next few weeks or months.

 

[Miner]

They must be getting close to announcing the strategic partnering plan, unless it comes out with the DFS. But, if they finalise something it will be material to the market so they probably can't hold that a secret. The two statements I've underlined in their interim financial report contradict each other a bit. Firstly they say the process has concluded and then they they've started discussions?? It's one or the other.

I'd anticipate getting a major miner or off-take agreements from a major car company(ies) for funding the capex will be a significant catalyst in the next few weeks or months.

View attachment 162448

Mate @Sean K
I must confess - I like your confidence in CTM for sure.
Let's hope when the DFS gets completed and if there is any hidden item on the process flow sheet and environmental program.
Junior miners are great when they have a plan to produce, but when the goal is to build up hype, DFS, and sell out - there are lot to expect.
I am watching this stock for my future tips

 

[Sean K]

Mate @Sean K
I must confess - I like your confidence in CTM for sure.
Let's hope when the DFS gets completed and if there is any hidden item on the process flow sheet and environmental program.
Junior miners are great when they have a plan to produce, but when the goal is to build up hype, DFS, and sell out - there are lot to expect.
I am watching this stock for my future tips

The risk is they do a CHN and produce a feasibility study that underwhelms. I'm a little concerned with market reaction to under delivery, which they may be every chance of doing. The big problem I see here is that they're adding on other metals to the flow sheet which is going to complicate it and the proposed pit is now massive. The strip ration will be huge. They're also not including UG in the financials and LOM for the DFS, which is just dumb. There's probably a reason why it's almost half of it's highs. One is the price of nickel, which has come off a bit, and China pausing post Covid. But, maybe there's something else outsiders don't know. Something with ESG clearance that's out of left field. Nickel no longer being that important. But, the government has classed it as a critical mining development. BHP bought OZL not just for Cu but for the Ni as well. So, I'm at a bit of a loss to why it's got a MC which is going to 20% of the likely NPV in the DFS.

 

[Miner]

The risk is they do a CHN and produce a feasibility study that underwhelms. I'm a little concerned with market reaction to under delivery, which they may be every chance of doing. The big problem I see here is that they're adding on other metals to the flow sheet which is going to complicate it and the proposed pit is now massive. The strip ration will be huge. They're also not including UG in the financials and LOM for the DFS, which is just dumb. There's probably a reason why it's almost half of it's highs. One is the price of nickel, which has come off a bit, and China pausing post Covid. But, maybe there's something else outsiders don't know. Something with ESG clearance that's out of left field. Nickel no longer being that important. But, the government has classed it as a critical mining development. BHP bought OZL not just for Cu but for the Ni as well. So, I'm at a bit of a loss to why it's got a MC which is going to 20% of the likely NPV in the DFS.

Go deeper as I mentioned in the past about MLX.
It is the people who running the DFS - who are they? Who is the consultant? What is the track record of delivery from the owner team study lead and consultant study team lead? Process Flow Sheet - is it accurate enough? Q4 FY 23 target from what original? Why does Vale commit a little because there is no one else in Brazil who will come to buy off-take? Is Vale waiting to see the price drop so that they can come in? Environmental approval or progress is a big asking factor here.
Positives are plenty, however - ore body, nickel deposit, infrastructure - great. What about the board and who controls it in actual form?
We are outsiders to speculate, however. Hopefully, all speculations are wrong and the DFS will be too good to shoot the SP to $2- who knows?