ETM - Energy Transition Minerals

[mr. jeff]

hi everybody, saw this thread for the first time the other day, sounds very interesting...thought I would be the one to post the great news for holders.

excerpt from The Australian 10/09/10 (today)

GREENLAND Minerals and Energy soared more than 75 per cent today after the Greenland government made a key regulatory change.

The Perth-based company welcomed news that Greenland’s government had amended the standard terms for exploration licences, which will allow it to develop its flagship Kvanefjeld project for its rare earth elements, uranium and zinc.

Greenland Minerals said it can now commit to definitive feasibility studies in 2011, as planned, after the decades-old ban on uranium mining was essentially lifted.
How does this bode? Looks like GGG may now be let off leash? thoughts?

 

[benwex]

Hello there,

I have been thinking about GGG now post a favourable decision for the Uranium mining in Greenland.

But I do want to draw attention to the ridiculous number of options which expire in 9 months.

There are 168,632,047 options @ $0.20 expiring at 30 June 2011. This compares to a 222,508,555 fully paid ordinary shares as of September 2009 (last annual report).

This dilution will have a massive affect on the share price.

Does anyone else share my fears? the timing of information now till option expire will be interesting to say the least..

I hate that I am so cynical.

Benwex

 

[mlchua]

Hello there,
There are 168,632,047 options @ $0.20 expiring at 30 June 2011. This compares to a 222,508,555 fully paid ordinary shares as of September 2009 (last annual report).

This dilution will have a massive affect on the share price.

Interesting point... Can someone explain the consequence of this when the time comes?
Basically if 2/3rd of GGG's issued shares would be bought cheaply by option holders at a much cheaper price than the trading price, thus must the company then issue additional shares to cover the options, thus almost doubling the amount of shares floating around and basically drop the price by half?

 

[enigmatic]

It does seem that it would drop the price by half.

I actually was wondering if anyone had a reason behind the sudden spike in price up 24% so far today. I was expecting this share to go quiet for the next year until exploring started up again.

any thoughts.

 

[kgee]

Haven't followed GGG in a while, the rumour mill always runs with this one.
I know Greenland Govt comes together over Nov/Dec to vote on various stuff so....
And on the subject of share dilution I think the option's money has being allocated to buy out the remaining share of the project...I think currently they own 67%?

 

[thestevo888]

Haven't followed GGG in a while, the rumour mill always runs with this one.
I know Greenland Govt comes together over Nov/Dec to vote on various stuff so....
And on the subject of share dilution I think the option's money has being allocated to buy out the remaining share of the project...I think currently they own 67%?

So are you saying that it's not going to be an issue re: the sp falling if options are exercised?

 

[kgee]

Well it definitley would be a plus for them to have 100% ownership of Kvanefeld...I think the legal case with them and Westrip over ownership is still going on.
I no longer hold this stock,(I should have held on I had a stack of options at average 8 cents) but if I remember correctly it was going to cost another 60 million for full ownership?
Share dilution is always a problem, but maybe it will be offset with the 100% ownership, it depends on what you think the project is worth.
The in-situ valuation is huge but the grades are low, and the mineraology complex and of course Greenlands stance on Uranium needs to be clarified!
But my thoughts on the matter were this could stand up as a Uranium project all on it's own the REE's were always the icing on the top

 

[exgeo]

The in-situ valuation is huge but the grades are low, and the mineraology complex

Going by the presentation of 19/5/2010 from Northern Uranium NTU, the value of REO at Kvanefeld is between that of Nolans Bore (ARU) and Mt Weld (LYC). I assume this is the value of the concentrate produced after processing, not the in-situ value of a tonne of rock though. I also remember reading (in The Australian I think) that Kvanefeld is relatively enriched in the higher-value heavy rare earths.

It seems Westrip is gradually selling down their stake in GGG. Must be regretting it today, given the runup in the SP lately!

 

[ashwints]

does anyone see the price of this stock appreciating over the coming weeks?

 

[flee]

Massive price drop since their high of almost $1.10. Seems everybody has jumped off the bandwagon.

 

[MEGALADON]

While their project has huge upside potential depending on actual uranium resource and how the politics pan out, they are also listed in the top 20 shareholders for Riviera Resources (RVE) which is due to re list shortly after acquiring a substantial Iron Ore project in Brazil "South American Ferro Metals Ltd".

 

[exgeo]

Since the beginning of October, 20m new shares have been issued because of the excercise of various options. The outstanding shares are now 270m. Makes good sense to excercise the option at 20c or 50c and then sell on the market for the current price of 80 or 90c. This can't have helped the share price recently.

 

[DAVIDB75]

approval to 'fully evaluate' in Greenland has been obtained - not sure how significant this approval is but it must be a big step forward.

 

[gland]

lots to wonder about here .The company claims to own 100% others claim its 61% but dont worry thats in court for a couple of years
Company claims right to uranium,Greenland government states in press release no rights to explore or exploit.
Company even makes claims to others ground.
Company seams to not want to talk about the option situation

 

[Market Depth]

I took an aggressive postion on GGG on the 23rd of Dec, @0.95, knowing about the option issue. And closed the postion today at $1.35, it's been trading in an irregular way on the market depth and that didn't sit well with me.

 

[exgeo]

lots to wonder about here .The company claims to own 100% others claim its 61% but dont worry thats in court for a couple of years
Company claims right to uranium,Greenland government states in press release no rights to explore or exploit.

Gland, you're almost right. On page 33 or GGG's 9th Sept 2010 presentation, it says the company owns 61%, Westrip owns 39% of the project. GGG may move to 100% by issuing shares or cash to Westrip. This agreement does not expire. Westrip also owns nearly 19% of the shares in GGG.

The 14th Dec 2010 announcement from GGG entitled "Approval to evaluate uranium at Kvanefjeld" I suppose is self explanatory. Not approval to exploit yet, but seems the Greenland govt are moving in that direction. Hardly surprising seeing as there is little industry in Greenland currently.

 

[gland]

to ex geo government greenland in press release states no one has right to explore or exploit uranium so thats clearly out of the picture and should not be used in any cash flow.As for the other the drums are quite loud ggg only owns no more than 61% something about ggg ending the jv.Interested to see a company comment on this , but this company seams veryslow to release bad news.For example they still include uranium in their cash flow when it is not even included in their licence and have not told the market this deverstating news.

 

[exgeo]

to ex geo government greenland in press release states no one has right to explore or exploit uranium so thats clearly out of the picture and should not be used in any cash flow.As for the other the drums are quite loud ggg only owns no more than 61% something about ggg ending the jv.Interested to see a company comment on this , but this company seams veryslow to release bad news.For example they still include uranium in their cash flow when it is not even included in their licence and have not told the market this deverstating news.

This note appears at the bottom of most of GGG's market-releases - right after the bit that says "About Greenland Minerals & Energy". The text changed a bit after discussions with the Greenland govt (which was reported in the paper at the time and resulted in a large jump in GGG's share price

Greenland Minerals and Energy Ltd is aware of and respects the Greenlandic government stance on uranium exploration and development in Greenland – which is currently a zero tolerance approach to the exploitation of uranium. However, a new amendment has now been introduced to license terms in Greenland that creates a framework for the evaluation and permitting of projects that contain uranium.

New version. Text changed after the 14th Dec announcement. I have bolded the new text:

Greenland Minerals and Energy Ltd is aware of and respects the Greenlandic government’s stance on uranium exploration and development in Greenland – which is currently a zero tolerance approach. However, a new amendment has been introduced to the standard terms for exploration licenses in Greenland that creates a framework for the evaluation of projects that include uranium amongst other economic elements. Within this framework the Company is permitted to fully evaluate the Kvanefjeld project, inclusive of radioactive elements.

Granted, this does not yet allow them to exploit Uranium, only explore for it.

 

[gland]

to ex geo you seam to have this quite wrong the government announcement is quite clear,ggg does not have the right to EXPLORE or exploit uranium.The so called changes were designed for those unfortunate people who had say a gold mine with say some thorium to be able to assess the enviromental and social impacts of that only, of them unfortunatly having a radioactive element present in their ore.
Secondly like much of the world the ggg licence does not include oil, if they wish to explore for oil they would have to lodge an application.Uranium is the same it is not and can be on the same licence,and the government is not taking applications for uranium licences, which is fortunate for ggg because if they were i am sure one of the more efficent locals would get their application in first.

 

[jonojpsg]

Interesting point... Can someone explain the consequence of this when the time comes?
Basically if 2/3rd of GGG's issued shares would be bought cheaply by option holders at a much cheaper price than the trading price, thus must the company then issue additional shares to cover the options, thus almost doubling the amount of shares floating around and basically drop the price by half?

Doesn't necessarily mean that price will drop by half even though there will be twice the shares on issue, just means the market capitilisation will double if the SP remains the same.

Although if I was a shareholder and could buy shares at 20c then sell them at $1.30 straight up, I would be doing whatever it took to get the money to do so. Obviously if everyone holding options has the same idea it means that there would be a lot more people willing to sell, most likely at prices from 80c? up - that's a stab in the dark of course, but if you can make 4x your money or 3x your money or 5x your money it makes little difference given that it's a no risk situation.

Certainly would make trading over the next six months till options expiry less certain - I would think hard about buying at current levels given that situation.

I don't hold and am not planning to at this stage.