CTM - Centaurus Metals

[Sean K]

Mr Market is saying something is wrong here. They're telling us all the ESG stuff is progressing which was a perceived risk. Maybe the capex is going to blow us away and the numbers are already out to some insiders who are running for the door.

Could just be price of nickel too which has been smashed due to the Indonesians and Filipinos flooding the market.

This was my largest stock holding but it's getting less and less... I still believe in it longer term. Might be time to crystallise a loss and rebuy.

 

[Sean K]

CTM is being castrated due to Indonesia flooding the market and smashing the price of nickel.

There's also some negative news in Brazil regarding a ferronickel developer in CTMs region which has had big cost blow outs and delays in their project which has Glencore and Vale backing them. Got smashed this week.

As discussed previously, it seems China doesn't care about the CO2 cost of producing nickel from laterite mines like those in Indon and Philippines and there seems to be little appetite from EU, Japanese and US car makers to pay more for sulphides. So much for ESG credentials of EV makers wanting to reduce their emissions. Should have known.

BHP are still backing the play though, so I'm holding on. Hopefully they might see CTM as a nice bolt on even though it's in Brazil.

 

[Miner]

Nickel conference in Perth hopefully will reveal some facts. Good luck with CTM

 

[Sean K]

This is not at all surprising. This is the forth delay or change in goal posts I think. A long history of promising and not delivering.

I understand why. The project has considerably changed over the past two years with a massive increase in the MRE and changed market conditions, but it's pretty frustrating when they keep on coming up with new project timelines that have delayed everything by at least a year and probably more by the time they come out with their next timeline.

I wouldn't be surprised if we get to Q1 23 and they tell us it's delayed again, or that there's an environmental issue holding up the project.

I don't think anything smells other than they've been communicating poorly and might have chosen the wrong project manager and lead engineer company. Ausenco are reputable, but this is not something they will want to put on their CV.

The sceptic in me says that they don't want to deliver something with depressed nickel prices and want to wait for a rise, or at least a base in the PON to release the financials with some upside instead of downside.

Timeline May 21

Timeline June 22

Timeline Nov 22

Timeline Aug 23

The next timeline will put back everything from DFS to production by at least 1Q and possibly 2Qs. I wouldn't be counting on anything at this stage.

Maybe they shouldn't be putting these timelines out at all and just say - we're doing our best.

 

[Miner]

Follow the trend - delay because of ALS.
Delay because of Ausenco.
What the owner's study team in Perth and Brazil is doing?
What's for the board taking fees?
Who is watching the delay?
Why or rather what is the project manager doing to manage the delay?
How the progress payment was paid?
Where is the KPI?
All smokescreen.
What about the investors not the fat CATs who get free millions automatically.
This is a typical got up tight leaped team.
Poor ALS, poor Ausenco and poorer small investors.

 

[Sean K]

The DFS is just been done on the open pit so I don't think we'll see any of this included in measurable upside in the DFS. But, it's obviously going to go under ground eventually and be a very long life asset. No idea how much these extensions will add to the updated MRE. Another 50-100Kt maybe. Will certainly push the overall contained Ni close to or beyond 1Mt. Looks like it's just going to go deeper too.

 

[Sean K]

This had a disastrous year last year and destroyed my 2023 tipping comp numbers. If it had have just been even I would have won the first prize easily. Was tempted to pick it again but I doubt the nickel price is going anywhere due to Indonesia and China fvking the market.

A slight sign of hope for this was Canadian Nickel Co getting financing and offtake agreements from Samsung yesterday which was the reason for their SP doubling over the past week or so. That had been on a downward trend for the past year like this. It's got a worse resource but is in Canada which might be perceived to be a better jurisdiction, but I don't think so.

OK news today was technical approval of the mining lease application but the elephant is still environmental clearances. The pit is going to be 3km x 1km so it's a huge deal to get that done. There doesn't seem to be any indigenous issues that they've told us about but I don't trust this part of the process at all. Adam Bandt and Bob Brown are probably in Brazil trying to find a rare purple spotted pink swift parrot on their site to halt the project right now.

It's been a very long time since we had drilling results which is poor darts. They were drilling a 1km deep hole about three months ago and have provided nada. Looks like they've been on holidays in Copacabana trying to avoid being mugged on the beach.

 

[Miner]

This had a disastrous year last year and destroyed my 2023 tipping comp numbers. If it had have just been even I would have won the first prize easily. Was tempted to pick it again but I doubt the nickel price is going anywhere due to Indonesia and China fvking the market.

A slight sign of hope for this was Canadian Nickel Co getting financing and offtake agreements from Samsung yesterday which was the reason for their SP doubling over the past week or so. That had been on a downward trend for the past year like this. It's got a worse resource but is in Canada which might be perceived to be a better jurisdiction, but I don't think so.

OK news today was technical approval of the mining lease application but the elephant is still environmental clearances. The pit is going to be 3km x 1km so it's a huge deal to get that done. There doesn't seem to be any indigenous issues that they've told us about but I don't trust this part of the process at all. Adam Bandt and Bob Brown are probably in Brazil trying to find a rare purple spotted pink swift parrot on their site to halt the project right now.

It's been a very long time since we had drilling results which is poor darts. They were drilling a 1km deep hole about three months ago and have provided nada. Looks like they've been on holidays in Copacabana trying to avoid being mugged on the beach.

View attachment 169114View attachment 169113

@Sean K and the CTM holders - good luck.
Yes, it is a significant step - thanks to Bruno (ED of CTM) and his Brazilian-based team for great work.
The formal issue of the Mining Lease is now only conditional on the issue of the Installation Licence (LI) by the Pará State Environmental Agency (SEMAS). • Environmental Impact Assessment (EIA)- as stated in the release, is still significant. With the status of DFS getting delayed and delayed, unfortunately, in my opinion, it will take some time to get the installation license (LI) completed as per the Brazilian system.
DNH

 

[Miner]

At last the announcement came bringing fruition of waiting for CTM holders. The grant of LP.
Surely @Sean K and other holders will be very happy. Somehow market failed to recognise it yet. Does it need Next Investors to pump and bump?
Definitely this is a long awaited news for holders

 

[Sean K]

At last the announcement came bringing fruition of waiting for CTM holders. The grant of LP.
Surely @Sean K and other holders will be very happy. Somehow market failed to recognise it yet. Does it need Next Investors to pump and bump?
Definitely this is a long awaited news for holders

Yes, good news, but nickel still in the toilet, and outlook not getting any better short - mid term. If Prabowo gets in as the next President in Indonesia word is he doesn't care about flooding the market with cheap dirty nickel, so it might spell trouble for a while yet.

I think CTM need an offtake and financing agreement with a battery or vehicle OEM in Europe or the US for it to change around in the short term.

If they come out with a DFS that has a much larger capex than the last scoping study without a funding plan that might not be looked at favourably.

DFS has been delayed twice so I don't think they can do it again, but wouldn't be that surprised if they delay it further until the price of nickel turns, or they have that offtake done.

 

[Sean K]

I capitulated out of my only Ni and Li holdings a few weeks ago, casting CTM and IGO into the Indonesia oversupply dungeon of hell. I didn't pick the bottom to sell which is good but I'm looking for a bottom to pick. Watching CHN closely as well for a turnaround story at some point. But, I think the market can stay pretty awful for these players for some time, or even get worse. I mean, CHN going from 8 bucks to sub 1 is a very good example of what can happen.

CTM now has a MC of $150m and their feasibility study done ages ago on a much smaller resource had an NPV way over $1b. So, eventually the numbers should stack up. It's just a matter of time.

But, unfortunately I think the supply demand curve that benchmark minerals et al were working on a couple of years ago has been thrown in the dunny due to Indonesia/China just going nuts on the 'dirty nickel' they're producing, flooding the market and destroying our clean green nickel market.

Call me a conspriotist but I have a feeling this was by design and part of China's grand strategic plan. Like, allowing Russia and Iran to start wars in the West to weaken international defence structures and supply chains in preparation for invading Taiwan. When NATO have run out of bombs and missiles, it's game on.

I'm not even going to suggest this could be a bottom. A bottom might be zero.

 

[mullokintyre]

I capitulated out of my only Ni and Li holdings a few weeks ago, casting CTM and IGO into the Indonesia oversupply dungeon of hell. I didn't pick the bottom to sell which is good but I'm looking for a bottom to pick. Watching CHN closely as well for a turnaround story at some point. But, I think the market can stay pretty awful for these players for some time, or even get worse. I mean, CHN going from 8 bucks to sub 1 is a very good example of what can happen.

CTM now has a MC of $150m and their feasibility study done ages ago on a much smaller resource had an NPV way over $1b. So, eventually the numbers should stack up. It's just a matter of time.

But, unfortunately I think the supply demand curve that benchmark minerals et al were working on a couple of years ago has been thrown in the dunny due to Indonesia/China just going nuts on the 'dirty nickel' they're producing, flooding the market and destroying our clean green nickel market.

Call me a conspriotist but I have a feeling this was by design and part of China's grand strategic plan. Like, allowing Russia and Iran to start wars in the West to weaken international defence structures and supply chains in preparation for invading Taiwan. When NATO have run out of bombs and missiles, it's game on.

I'm not even going to suggest this could be a bottom. A bottom might be zero.

Problem is, what even will provide the base for Nickel?
As you pointed out, Indonesia is poised to flood the market with dirty Nickel.
Chinese won't care, they will lap it up, and all the Western feel gooders will wring their hands and say tut tut.
Mick

View attachment 170650

 

[Miner]

I capitulated out of my only Ni and Li holdings a few weeks ago, casting CTM and IGO into the Indonesia oversupply dungeon of hell. I didn't pick the bottom to sell which is good but I'm looking for a bottom to pick. Watching CHN closely as well for a turnaround story at some point. But, I think the market can stay pretty awful for these players for some time, or even get worse. I mean, CHN going from 8 bucks to sub 1 is a very good example of what can happen.

CTM now has a MC of $150m and their feasibility study done ages ago on a much smaller resource had an NPV way over $1b. So, eventually the numbers should stack up. It's just a matter of time.

But, unfortunately I think the supply demand curve that benchmark minerals et al were working on a couple of years ago has been thrown in the dunny due to Indonesia/China just going nuts on the 'dirty nickel' they're producing, flooding the market and destroying our clean green nickel market.

Call me a conspriotist but I have a feeling this was by design and part of China's grand strategic plan. Like, allowing Russia and Iran to start wars in the West to weaken international defence structures and supply chains in preparation for invading Taiwan. When NATO have run out of bombs and missiles, it's game on.

I'm not even going to suggest this could be a bottom. A bottom might be zero.

View attachment 170650

Very strategic viewpoint.
CTM based its calculation probably a nickel price of $20k, did escape PFS and being managed by a less than acceptable calibre study manager plus inadequately resourced consultancy.
These can be managed with some realistic changes and review of reality, even if nickel price remains as it is. My two cents

 

[Miner]

Nickel story may not encourage many nickel hopefuls and producers. I read on a thread.

BHP has become the latest to reveal how damaging the plunging nickel price is to its business.
It's updated the market, flagging a $US3.5 billion ($5.4 billion) pre-tax impairment against the value of Nickel West.
Australian nickel mines have been closing on the back of a crashing commodity price.
It peaked above US$48,000 a tonne in March 2022 and today the spot price is US$16,000 a tonne.
The sector is extremely interconnected in Western Australia.
Today, BHP has confirmed it is considering putting the entire Nickel West business into care and maintenance.
Nickel West employs about 2,500 workers in WA, across its mines, smelter, concentrator and refinery.
The company said it expected to report a circa $US200 million loss for the first half from its Nickel West operations, and estimated it would cost about $US900 million for closure and rehabilitation costs.
BHP will update the market on Tuesday February 20, when it releases its half year results.
Its shares have fallen more than 1.85 per cent today on the back of the announcement.

 

[Sean K]

Change of plans and delayed for another quarter. This is about the 4th significant delay and I won't be surprised if there's another. Considering what else is going on I'm surprised this is still a going concern. Maybe lucky they're in development and not operating although I do wonder where capex will come from if the Ni market doesn't change around this year. Indonesia and China have really screwed this market.

 

[mullokintyre]

Change of plans and delayed for another quarter. This is about the 4th significant delay and I won't be surprised if there's another. Considering what else is going on I'm surprised this is still a going concern. Maybe lucky they're in development and not operating although I do wonder where capex will come from if the Ni market doesn't change around this year. Indonesia and China have really screwed this market.

View attachment 171898

There are straws being clutched.
mick

 

[Miner]

CTM is just building up free issue shares and options to the MD and a most incapable project development and execution team without a project execution plan.
Shareholders of ctm may ask for a copy of PEP and see its date of inception.
Poor nickel price is just an excuse now

 

[Sean K]

CTM paused the crashing downward spiral around the 30c mark. Maybe an EV of around $110m is ground floor for something with this much nickel in the ground and a NPV of over $1b.

DFS due this quarter on a revised flow sheet that does a concentrate instead of a finished product due to Indonesia and China crapping on the market. Numbers will be interesting. The Capex numbers will be particularly interesting considering how low in value this is now. Where are they going to get $500m ish from with a MC 1/5th that? Going to have to sell themselves me thinks.

I capitulated at around 40c but am still interested in the longer term plan here once the oversupply issues correct themselves. If they do I guess. And, when are the 'clean' producers going to actually get the much promised premium?

Interesting to see IGO on the register, hadn't noticed that before. Hmmmm

 

[Miner]

@Sean K - I was hoping to see your positing but you might have lost interest on the lack of capability of Centarus team so I thought to share some features from DFS. Market reacted positively only because the analysts have not opened their laptop and Excel models yet.
Some hidden secrets

1. Optimisation - does indicate there were lot of stuff up need to iron out.
2. Cash in hand just to finish the DFS . So there will be another big CR for sure. That has not stopped to issue freebies for the MD and his favourite team however. The buzz words actively pursued, identified several opportunities to improve are only buying time and giving space for more work to keep market engaged.
3. No explanation of delayed release of DFS from March 2023 to end of Q2 2024. Latest announcement was Q1 24.
4. Long lead equipment procurement is unsure.
5. Still the process flowsheet for flotation circuit clearly shows incompleteness and weakness of the DFS. This is the fatal flaw for the investor to get the return of investment on time. Under good project management, the process flow sheet must be frozen after PFS. In this instance CTM chosen not to have a PFS . That was a bad decision and legacy is still going on.
6. In summary I still feel Jaguar had a good business case but it has been butchered instead of precision cutting by a good surgeon. Surgeon and butcher both use sharp knives but the outcome is different and risks are different too. Now CTM will continue to look for off taker and a partner to bail them out. Unless current PM team and drivers are changed, there is no hope for me to put my money here.

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02823481-6A1214052

The above section contradicts the below section.

 

[Sean K]

I lost several fingers on this last FY, but I'm determined to re-grow them at some stage. Picking a bottom at 25c and selling at 50 might have done it, but with what Indonesia and China have done to the Ni market, I didn't dare think about re-entering this puppy.

So, what the hell is going to change for CTM? Is the nickel sulphide story going to eventually come true? Are EV and battery makers going to pay more for the better (low CO2) gear, or just keep buying the cheap crap?

Maybe having a resource bigger than most of BHP's deposits will do it.