DMM - DMC Mining

Sean K · 7 January 2009

Re: DMM=a bunch of dreamers

tigerboi said:
kennas mate i work in the transport industry my family has been in the game for over 107 years,this is my area of expertise...my cousin is a train driver for pac nat...i sent him the pics of the line dmm want everyone to believe they will cart 3mtpa on...

i said cuz what about this mob...he laughed his head off...
the clincher for me was bringing in grd minproc(mine engineers) instead of downer edi(train/track builders)to assess the track...also they did not inspect the entire length,they use 2 types of grade 46 & 50kg,the gauge is small = small wagons,less weight...

kennas cop a fair dinkum tip...1.the entire railway must be upgraded,2.they are a bunch of dreamers.

remember this from the scoping study which no one else took the time to carefully study...The rail system is well suited for the exploration and construction phases of the project.

go check out the pics of the railway & tell me they will get 3mtpa(150+ trips)on it...

imo $1.00+ was a good opportunity to get out in front...tb

Yes, wish I had sold more over a $1.00.

We seem to have some conflicting detail on the rail line. Personally I haven't stood on it, and I defer to your cousins train driving experience in assessing the capability of the line to haul some rocks, over GRD.

Some quotes from the scoping study:

Existing rail capable of transporting 11Mt/a with minor upgrades.

it became clear from investigations of the infrastructure; (power; rail and port) that these facilities were largely in place

The existence of an operating rail line within 3-5 km of the proposed mine site raises the possibility of bringing the mine into production within a short time frame.

As the rail infrastructure to transport the ore to port is substantially in place processing rates of up to 3 Mt/a could be comfortably accommodated at start-up.

it is currently used for passenger and freight services and was used previously to transport ore. As a consequence major repairs are not expected.

The initial evaluation indicates the line is capable of carrying 11 Mt/a.

Your single quote:

The rail system is well suited for the exploration and construction phases of the project

Followed by:

Extensions to the rail line are required for the production phase. A rail loop of approximately 5 km will be built for the 3 M t/a start-up during Stage 1A construction. This will link into the northern rail line in the vicinity of Mayoko and extend to the processing plant.

Of course, I expect capex to blow out as it almost always does, and one of those things may be improvements to the rail line.

But, it's not a war stopper at this stage on the surface of it. Nothings a certainty of course, and there's a long way to go for this to be feasable.

What is a war stopper at the moment is if IO prices tumble to well below Opex. I'm expecting a year or so of depressed prices before the world recovers and Chindia continue on. They'll need some iron for that.

tigerboi · 11 January 2009

Re: DMM=a bunch of dreamers

kennas the railway line will have to be upgraded to modern standard,as ive pointed out grd minproc are not railway engineers & do not have a railway division like downer edi & finally the entire railway was not inspected...

i understand your optimism with your quotes there but the infrastructure is 1960's...go look at the quotes & youll find words like,possibility,could be,indicates...

just wondering have you seen a photo of the railway line?...tb

Sean K · 11 January 2009

tigerboi said:
kennas the railway line will have to be upgraded to modern standard,as ive pointed out grd minproc are not railway engineers & do not have a railway division like downer edi & finally the entire railway was not inspected...

i understand your optimism with your quotes there but the infrastructure is 1960's...go look at the quotes & youll find words like,possibility,could be,indicates...

just wondering have you seen a photo of the railway line?...tb

Yes, I've read the words and seen the photos just as you have. Neither of us have stood on the line, and your cousin hasn’t either.

Back to your key quote, again:

The rail system is well suited for the exploration and construction phases of the project

Which in context looks poor, but you failed to include the rest of the paragraph, as I did above, which said:

Extensions to the rail line are required for the production phase. A rail loop of approximately 5 km will be built for the 3 M t/a start-up during Stage 1A construction. This will link into the northern rail line in the vicinity of Mayoko and extend to the processing plant.

An extension of 5km ….

Yes, I agree, would have been good to bring in a rail special specialist to assess the rail aspect, but GRD do a lot of mine infrastructure development work. I’m in the process to see what they’ve done in terms of rail, but I’m sure it’s just prelim stuff like this is. Prelim work. In the end, some aspect of the project may fail, and logistics may be it. However, I’d be more concerned about the effect of the Credit Crisis and long term contracted IO prices right now. All interlinked of course, but these guys already have an established rail link, free to use with upgrades required, which beats the mid WA wannabes on a few levels at this time.

tigerboi · 11 January 2009

Re: DMM-railway must be upgraded

not talking about the 5km loop to the mine thats easy...talking about the rest of the line...

here is a pic of the narrow gauge slated to take 11mtpa remember without an upgrade...& heres your narrow gague wagons as well
imo i think there has been abit of a con job going on,good luck...tb

d_crome · 12 January 2009

Re: DMM=a bunch of dreamers

tigerboi said:
kennas the railway line will have to be upgraded to modern standard,as ive pointed out grd minproc are not railway engineers & do not have a railway division like downer edi & finally the entire railway was not inspected...

i understand your optimism with your quotes there but the infrastructure is 1960's...go look at the quotes & youll find words like,possibility,could be,indicates...

just wondering have you seen a photo of the railway line?...tb

TB - not that I doubt your statements, however I do believe that most of the rail infrastructure used throughout India and Africa for both commercial and industrial use were constructed well before 1960 by the then European Colonial powers.

India is running on not only rails, but ENGINES that were built over 200 years ago.

It will be interesting to see how this plays out, but I definitely appreciate an alternative point of view.

KENNAS - what's your take on the 2 Mil from CFR and the loan conditions that were placed upon DMM?

Sean K · 12 January 2009

Re: DMM=a bunch of dreamers

tigerboi said:
i understand your optimism with your quotes there but the infrastructure is 1960's...go look at the quotes & youll find words like,possibility,could be,indicates...

just wondering have you seen a photo of the railway line?...tb

Also, I am no more or less optomistic (as you say) on this than any other stock on the ASX. I see things as they are.

The quotes I've provided are just that - just about all of the quotes I could find (good or bad) related to the rail line. You have made your best attempt to pick one quote out of context to define the entire rail infrastructure, which is clearly a biased approach. For some reason you are intent on downramping DMM by cherrypicking aspects of the Scoping Study, which when examined are clearly incorrect and show you to be extremely biased, for whatever reason.

1960s infrastructure? Like a 40 year old rail line is unserviceable?

'Possibility', 'could be' ?? Yes, they should use those terms, but I can't be bothered looking for them right now, but I hope they have used them. Unlike you, who's using definatives on an exploration project.

Yes, I've seen the photos like anyone else who's researched this. Thanks for reposting them. Yes, it's a standard guage rail line, what you use for carrying rail carriages with stuff in them. Thanks. Maybe they could get someone out there with a whipper snipper to make it nicer for you.

Chart wise this is a disaster for long term buy and hopers and if the IO prices continue to suffer this will also.

Just because you drive a truck and your cousin drives a train clearly does not make you the king of infrastructure development, nor the king of assessing the future potential of iron ore exploration companies.

I am open to decent analysis of this company, including assessment of the rail line, but so far the facts we have do not end up in DMM being 'dreamers'. They are only dreaming at this stage if Chindia totally falls over into the worldwide depression imvho.

tigerboi · 12 January 2009

Re: DMM-good luck

I would post the scoping study but you would more than likely say its too long,as for downramping(nice change thx) i got the right info at 47c BEFORE the anns,i chose to let it go coz i thought it was too risky.

imo there has been alot of hype with calls this will see $3-$4 & in the rush to get on board people have not looked closely,all theyve seen is 33mt of io in africa & a very old railway line...

anyhow all the best in getting square,i still reckon their a bunch of dreamers...tb

Sean K · 12 January 2009

Re: DMM-good luck

tigerboi said:
I would post the scoping study but you would more than likely say its too long,as for downramping(nice change thx) i got the right info at 47c BEFORE the anns,i chose to let it go coz i thought it was too risky.

imo there has been alot of hype with calls this will see $3-$4 & in the rush to get on board people have not looked closely,all theyve seen is 33mt of io in africa & a very old railway line...

anyhow all the best in getting square,i still reckon their a bunch of dreamers...tb

This has nothing to do with me and my investment. You seem to be very emotional about this for some reason. Perhaps because it deals with trains.

What is important in the scoping study has been posted. If something's being missed, paste it up! Another picture of a train line maybe?

Who called $3-4 and what was the justification? No one could have done that without giving some reasons, but your basis of this company being 'dreamers' is because you dont like the pictures of the rail line and the quote you provided in isolation which on review does not hold water as sufficient justification to can the entire line.

Perhaps the line will need significant upgrading, or even replacement, but the facts at the moment don't support your position imo.

tigerboi · 12 January 2009

Re: DMM-management dont give a toss about shareholders

The transport side of the project is the main issue however you now have the conv note to dempsey/cfe & how that will be paid back,if the oppies dont get in the money to pay it back then looks like dempsey/cfe might not convert & look to take the lot for not much...

as i said i reckon management have pulled a con job on investors who now have to sit tight to see if they can get square,recent placements & the conv note imo show what the company think of their investors...

good luck...tb

Sean K · 12 January 2009

Re: DMM-management dont give a toss about shareholders

tigerboi said:
The transport side of the project is the main issue however you now have the conv note to dempsey/cfe & how that will be paid back,if the oppies dont get in the money to pay it back then looks like dempsey/cfe might not convert & look to take the lot for not much...

What?

You're ahead of me on this one.

10th December 2008
ASX/MEDIA ANNOUNCEMENT

DMC secures A$2 million funding facility

HIGHLIGHTS
• Secured Convertible Note Deed completed
• DMC fully funded for the completion of the 2009 drilling programme at the Mayoko Iron Ore Project
• The 2009 drilling programme is part of the pre-feasibility study which has already commenced.

DMC Mining Limited (“DMC”) is pleased to announced it has entered into a secured convertible note agreement with Dempsey Resources Pty Ltd (“Dempsey”) Under the terms of the agreement, Dempsey has the right before the repayment date of 10th December 2009 to convert the Note into ordinary shares in DMC, subject to the approval by DMC shareholders. The conversion price will be the lesser of $0.10 and, the volume weighted average closing price of the DMC’s Ordinary Shares as quoted on ASX over the last five (5) trading days immediately preceding the delivering of a conversion Notice by Dempsey to DMC. DMC has agreed to pay interest at a rate of 12% pa on the convertible note. In addition, in consideration to Dempsey for subscribing for the Note, DMC has agreed to issue Dempsey 5,000,000 options which can be exercised at $0.15 on or before 30th
June 2010.

Get paid back? Opies conversion?

You're referring to Dec 2009? A year away?

I'm way out of touch here.

tigerboi · 12 January 2009

Do you mean this ahead of you? the jorc estimate BEFORE the scoping study was announced?if ive still got the PM ill let you see what you missed...
hope you get square before december 2009

tigerboi said:
For the record here i got a private tip for DMM at 47c...

ask yt he might still have the PM

J.B.Nimble · 13 January 2009

Hmmm… I’m no expert on rail but hours of reading Thomas the Tank Engine with my four year old has taught me that you don’t have to be the biggest engine on the island of Sodor to qualify as a Really Useful Engine

Narrow gauge - a realistic proposition or a kids plaything?
Cape gauge (3’ 6”) rail is not going to be as economically efficient as a standard or broad gauge rail system but it is standard across Southern and Central Africa, Indonesia, Japan, Taiwan, Philippines, and New Zealand. It does carry useful amounts of freight in these countries and is the gauge of choice due to topography (can go through tighter turning radii in mountainous country) and lower construction costs. Seems a bit harsh to write off their rail system just because they are not blessed with the pancake flat desert topography of Australia.

Bearing capacity?
It was constructed for manganese mining and so it would presumably have been designed with sufficient bearing capacity for narrow gauge ore wagons. Presumably some engineer did some calcs in an era when it was all done by slide rule, pencil, paper and a real feel for the numbers - Hmm, I'm feeling better already...

Economic train size?
The trains will be smaller than the equivalent trains in Australia. Why must 3m Tpa equate to 150 trips as TB suggests - why not 600 trips? It may look like economic suicide from an Australian perspective but the Congolese train drivers and maintenance crews are not pulling six figure incomes - lower labour costs flow through every part of the cost structure. It wouldn’t work in Oz but smaller, lighter, more frequent trains could be an economic proposition in Africa. It seems to me that 3m Tpa is a modest amount of freight to be carried on a line that they appear to have pretty much to themselves.

Line condition?
Although the manganese trains stopped running in 1986, the line is still used by a passenger train service and presumably receives some minimal amount of maintenance to keep the line in service. The most likely area of weakness would be the condition of the 40 year old bridges.

I no longer hold this one but it continues to interest me. I think the risks are less in the logistics area and more in the short term funding and medium term iron ore demand.

Sean K · 13 January 2009

tigerboi said:
ask yt he might still have the PM

Wow, you got a private tip from YT when it was 47 cents! Gee, wish I was so lucky. And I'll just have to hope that I can get square by Dec. Cheers.

J.B.Nimble said:
Hmmm… I’m no expert on rail but hours of reading Thomas the Tank Engine with my four year old has taught me that you don’t have to be the biggest engine on the island of Sodor to qualify as a Really Useful Engine

Now if you pushed Thamas around a bit, that would make you an expert and I'd listen to you.

Who Dares Wins · 13 January 2009

Re: DMM

kennas said:
Who called $3-4 and what was the justification? No one could have done that without giving some reasons......

Well actually back on the first page of this thread someone did call $3 - 5 and it was way back then I think the Young Trader called $1.50 - $3.00 although he gave alot of justification for it, which I believe was accurate.

By the way, where is Young Trader these days. I notice he hasn't visited this site for a couple of months.

There's only one way to settle this thing about the railway. One of us needs to go over to Brazzaville and embark on a train trip to the interior.

Kenna's - I think you should go.

Disc: I hold DMM

Miner · 13 January 2009

Re: DMM

Who Dares Wins said:
Well actually back on the first page of this thread someone did call $3 - 5 and it was way back then I think the Young Trader called $1.50 - $3.00 although he gave alot of justification for it, which I believe was accurate.

By the way, where is Young Trader these days. I notice he hasn't visited this site for a couple of months.

There's only one way to settle this thing about the railway. One of us needs to go over to Brazzaville and embark on a train trip to the interior.

Kenna's - I think you should go.

Disc: I hold DMM

I am throwing my hat in the ring to go to Brazzaville. The only problem is sponsorhsip . If some one buys me the return (not one way please) ticket, Kennas provides me the board and lodging then I will manage with my visa fee and local travel.

I do not hold DMM

tigerboi · 13 January 2009

Re: DMM

Who Dares Wins said:
There's only one way to settle this thing about the railway. One of us needs to go over to Brazzaville and embark on a train trip to the interior.

Kenna's - I think you should go.

Disc: I hold DMM

I second that seeing hes made so much coin off it he should take the ball up for the suffering DMM shareholders even if he doesn't hold anymore DMM...tb

Sean K · 13 January 2009

Re: DMM

Who Dares Wins said:
Well actually back on the first page of this thread someone did call $3 - 5 and it was way back then I think the Young Trader called $1.50 - $3.00 although he gave alot of justification for it, which I believe was accurate.

By the way, where is Young Trader these days. I notice he hasn't visited this site for a couple of months.

There's only one way to settle this thing about the railway. One of us needs to go over to Brazzaville and embark on a train trip to the interior.

Kenna's - I think you should go.

Disc: I hold DMM

YT is cruising about SE Asia.

The earlier valuations were probably based on the potential DSO and Mag in the ground and it's average value for an exploration company. Back then it made sence.

I'd love to go and kick the track, but tied up in Peru.

Will have to rely on the company for information at this point.

tb, I'm still holding a few. I would have sold out earlier on technicals but in doing so would have tanked the price too much due to the low liquidity. The price of buying into specs I suppose. Lesson learnt. Again....

tigerboi · 13 January 2009

I always thought $1.00 was a good price to bail out of this as its tightly held,for me had i bought at 47c then up to 94c to a $1.00 would of been the target.

I dont think the sentiment will change before the oppies are due in june i think?so that some cash can lob in to pay the $2m+12% back that would see a heads price of 50c,cfe can convert at 10c so investors will be loathe to pay much more than that.

my take is they've got til june to drill up maybe double the 135mt target to get the previous volume to 50c,personally i think cfe dipped their toe in the water for $2m knowing the odds are way in their favour & i think they wont convert the note(in 12 months)...more likely to want the project themselves.

next 5 months will be make or break...

as for the truck driving caper dont let that fool you kennas ol mate,did accounting,mathematics & some law when i was a young bloke,but love the highway...

while australia sleeps us drivers keep everyone fed,fuelled,newspapers etc

Take a look around your house,only thing not delivered would be a baby...everything else has been on a truck...tb

grace · 13 January 2009

I see the rail line has come up again in conversation. I had some heated discussion with young trader over it once upon a time. Miner came up with some thoughts as I recall. It does need some money spent on it, that is for sure. It is better than nothing though.

As already posted, biggest risk is funding and iron ore price, like all of the juniors. Can't even guess what the future holds for this one. I still hold my small holding.

shag · 15 January 2009

J.B.Nimble said:
Hmmm… I’m no expert on rail but hours of reading Thomas the Tank Engine with my four year old has taught me that you don’t have to be the biggest engine on the island of Sodor to qualify as a Really Useful Engine

Narrow gauge - a realistic proposition or a kids plaything?
Cape gauge (3’ 6”) rail is not going to be as economically efficient as a standard or broad gauge rail system but it is standard across Southern and Central Africa, Indonesia, Japan, Taiwan, Philippines, and New Zealand. It does carry useful amounts of freight in these countries and is the gauge of choice due to topography (can go through tighter turning radii in mountainous country) and lower construction costs. Seems a bit harsh to write off their rail system just because they are not blessed with the pancake flat desert topography of Australia.

Bearing capacity?
It was constructed for manganese mining and so it would presumably have been designed with sufficient bearing capacity for narrow gauge ore wagons. Presumably some engineer did some calcs in an era when it was all done by slide rule, pencil, paper and a real feel for the numbers - Hmm, I'm feeling better already...

Economic train size?
The trains will be smaller than the equivalent trains in Australia. Why must 3m Tpa equate to 150 trips as TB suggests - why not 600 trips? It may look like economic suicide from an Australian perspective but the Congolese train drivers and maintenance crews are not pulling six figure incomes - lower labour costs flow through every part of the cost structure. It wouldn’t work in Oz but smaller, lighter, more frequent trains could be an economic proposition in Africa. It seems to me that 3m Tpa is a modest amount of freight to be carried on a line that they appear to have pretty much to themselves.

Line condition?
Although the manganese trains stopped running in 1986, the line is still used by a passenger train service and presumably receives some minimal amount of maintenance to keep the line in service. The most likely area of weakness would be the condition of the 40 year old bridges.

I no longer hold this one but it continues to interest me. I think the risks are less in the logistics area and more in the short term funding and medium term iron ore demand.

40 yo bridges don't sound bad. hell its not that long ago. most in nz are way way way older for rail esp and road.
they cart a lot of coal on nz's crap railway lines.
and nz has plenty of 1970's locos and wagons to renew too that might only ever possibly be useful for some african hole(after the last governent was absolutely fleeced by toll for the way way outdated rolling stock last yr-600mill). hell they might pay and deliver to get rid of the 70's junk.

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