MCR - Mincor Resources

If you were in MCR late last week, you have obviously done very well, although I have no idea what would have made anybody want to buy MCR in the last 10 or 11 months – as it’s been a bit of a Pullback over that time…..

TA for MCR produces an odd Combination of a perfect Benchmark Candle Formation AND a Combination Benchmark Candle Formation that just happens to produce a Centre Line @ $1.44, that’s about where todays SP is hesitating, interesting to say the least..

The High Point of the BC reflects the maximum that punters are willing to pay for MCR over recent times, so a Sell on the CCI & MFI signals for 23/1/23 was a great move.

The Low Point of the BC reflects the minimum that punters are willing to sell MCR atm.

The Centre Point $1.44 is obviously related to the current Wyloo announcement’s.

The problem for anyone wanting to Buy in now is that they have no idea which way the MCR SP will go next.

MCR’s IV atm is about $1.16. – it’s a nightmare situation – Buy and you will prob loose – wait and you will miss the boat.

I always avoid situations like this – too many unknowns, best to move onto another stock IMO.


Cheers.
DrB

Anyone think the board might say this is opportunistic and we want more?

Sean K said:

Anyone think the board might say this is opportunistic and we want more?


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View attachment 154752

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Bit slow Sean - beat ya by 7 mins.

MCR is currently $1.66

it will be interesting to see who grab the cash , and who wait for a better offer

( i am content to hold long term , but doubt i will get that opportunity )

Just for a short time there I was in the green.

mullokintyre said:

I need 1.62 just to break even.
Mick

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Took 1.64, a tiny profit, but signifcantly better than the huge loss I was facing last week.
Mick

divs4ever said:

MCR is currently $1.66

it will be interesting to see who grab the cash , and who wait for a better offer

( i am content to hold long term , but doubt i will get that opportunity )

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I'm in the same boat, I've had them for a long time, I can't see how BHP wont mop up these small miners around the Kambalda hub, makes a huge amount of sense longer term to be vertically integrated and it sounds as though there is a lot of new nickel out at Widgie.
Nickel demand isn't going to decrease, until a major breakthrough in battery technology comes along, that offers a chemistry with similar or better energy density and they have been trying to do that since Li ion was developed.
They have LiFePo but that will be more focused to static storage and cheap E.V's, as E.V's become more mainstream more range will become the popular choice, same as ATM everyone isn't driving the smallest cheapest ICE car.

Could a Moderator Please Move my above Copper Post to 'Storm at Sea"
Thanking you in advance if this can be done

sptrawler said:

I'm in the same boat, I've had them for a long time, I can't see how BHP wont mop up these small miners around the Kambalda hub, makes a huge amount of sense longer term to be vertically integrated and it sounds as though there is a lot of new nickel out at Widgie.
Nickel demand isn't going to decrease, until a major breakthrough in battery technology comes along, that offers a chemistry with similar or better energy density and they have been trying to do that since Li ion was developed.
They have LiFePo but that will be more focused to static storage and cheap E.V's, as E.V's become more mainstream more range will become the popular choice, same as ATM everyone isn't driving the smallest cheapest ICE car.

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there was , at one stage a BHP discussion on what to do with Nickel West , bundle it in with S32 , keep it , or have it as an orphan ( divest like BSL or merge it like the WDS/petroleum arm deal )

will be interesting to see what BHP does here , especially with some other potential bidders ( MIN and IGO spring to mind )

the market seems to think a bidding war is likely

divs4ever said:

there was , at one stage a BHP discussion on what to do with Nickel West , bundle it in with S32 , keep it , or have it as an orphan ( divest like BSL or merge it like the WDS/petroleum arm deal )

will be interesting to see what BHP does here , especially with some other potential bidders ( MIN and IGO spring to mind )

the market seems to think a bidding war is likely

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Yes, I'm pretty sure I heard that BHP is more interested in nickel than lithium, so having all the Mincor mines close to the Kambada nickel processing plant would make a lot more sense for them, than for Twiggy IMO.
But you never know BHP is a strange beast, not one of my favourite shares, but if they gave a part share purchase I wouldn't say no.

sptrawler said:

Yes, I'm pretty sure I heard that BHP is more interested in nickel than lithium, so having all the Mincor mines close to the Kambada nickel processing plant would make a lot more sense for them, than for Twiggy IMO.
But you never know BHP is a strange beast, not one of my favourite shares, but if they gave a part share purchase I wouldn't say no.

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They went down the path of tier 1, very long life, through the cycles, types of projects. Not many of them about. Nickel might go through a couple of cycles, but on an individual project scale, MCRs don't seem to fit the profile from what I've seen. Would have been something bundled into S32 at the time. Interesting about the lithium perspective. RIO have said they're going down that path but BHP, no. A clear difference in what they think is a better long term play.

Sean K said:

They went down the path of tier 1, very long life, through the cycles, types of projects. Not many of them about. Nickel might go through a couple of cycles, but on an individual project scale, MCRs don't seem to fit the profile from what I've seen. Would have been something bundled into S32 at the time. Interesting about the lithium perspective. RIO have said they're going down that path but BHP, no. A clear difference in what they think is a better long term play.

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last i saw S32 ( i hold ) had some spare cash , but didn't spring to mind when Australian nickel is mentioned , but maybe i am wrong

the market seems to expect an improved bid though , i wonder if that is correct

cheers

To those who took the opportunity to sell into the recent price action above $1.60, well done.

Things are settling back. Will there be another offer? Possibly, but probably not. Not for a while, I'd think. .

sptrawler said:

Yes, I'm pretty sure I heard that BHP is more interested in nickel than lithium, so having all the Mincor mines close to the Kambada nickel processing plant would make a lot more sense for them, than for Twiggy IMO.
But you never know BHP is a strange beast, not one of my favourite shares, but if they gave a part share purchase I wouldn't say no.

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Sean K said:

They went down the path of tier 1, very long life, through the cycles, types of projects. Not many of them about. Nickel might go through a couple of cycles, but on an individual project scale, MCRs don't seem to fit the profile from what I've seen. Would have been something bundled into S32 at the time. Interesting about the lithium perspective. RIO have said they're going down that path but BHP, no. A clear difference in what they think is a better long term play.

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A good article that explains why I said BHP is a strange beast, they have enough money that stuff ups don't register, but they are a weird company IMO and I only buy them when at bargain basement prices.

Mincor is a small fish, but it produces nickel ore that is important to BHP both from a volume and geology perspective.

BHP can’t dig up enough nickel ore to run its Kalgoorlie smelter at the desired efficiency, so in recent years it has relied on neighbours like IGO, Western Areas and Mincor to supply extra volumes.

The Kalgoorlie smelter also has a chemistry problem; it was built to digest ore with a certain amount of iron for each unit of magnesium oxide, but BHP’s mines have in recent years served up ore with dramatically lower iron levels.
So when Mincor opened a small mine in the Kambalda region that originally fed the Kalgoorlie smelter in the 1970s, it provided more than a pleasant dose of nostalgia; it was the Goldilocks material for the smelter.

A mystery​

Mincor’s market capitalisation was about $93 million when BHP negotiated a term sheet with the junior for supply of its nickel ore into the BHP system in March 2019.

Why BHP didn’t just swallow Mincor whole back then remains a mystery, as we watch Forrest’s offer of $760 million for Mincor and wonder whether BHP will make a counterbid.

After all, the renaissance of nickel has been a central part of BHP’s public narrative since 2019 when the company declared it was no longer trying to sell its WA nickel business.

If Forrest does get hold of Mincor, it will be the second time in a year that a supplier to BHP’s Kalgoorlie smelter has been acquired by someone other than BHP: Western Areas was swallowed by IGO last year.


Forrest stuck his nose into that saga too. His rapid buying of Western Areas shares during the takeover bid garnered for himself an improved takeover price and a right to own part of any nickel sulphate plant that IGO chooses to build in Australia.

Nickel sulphate is a crystalline commodity that battery makers and electric vehicle manufacturers need.

Volume problems​

BHP built Australia’s first nickel sulphate plant at Kwinana over the past five years and now sells the majority of its nickel to battery and electric vehicle manufacturers like Tesla, rather than the less-fashionable, stainless steel makers that traditionally bought from its Nickel West division.

BHP risks being held to ransom here; if IGO and Forrest get enough nickel resources to warrant investment in their own nickel sulphate refinery, the volumes that Mincor and IGO currently sell into BHP’s Kalgoorlie smelter could be diverted, exacerbating BHP’s volume problem.

Throw in Noront, and Forrest’s private company, Wyloo Metals – led by Luca Giacovazzi, is starting to look like many of the things BHP wants but doesn’t have.
But even the OZ Minerals deal – likely to be formalised on April 13 by a vote of OZ shareholders – raises questions whether BHP is moving too slowly on these potential deals.

BHP had worked closely with OZ in the South Australian copper fields – the region that was the major motivation for the $9.6 billion acquisition – for a long time before deciding to pay $28.25 for each OZ share.

well BHP is a slow mover i don't debate that , so who has surplus cash ( or the willingness to issue extra shares ) and the ambition

if not BHP , would S32 have a close look ( even if only to stall the process for BHP to look closer )

MIN is willing to issue shares , to increase their assets ( i bought some NWE to deliberately increase my MIN holding ) would MCR fit in their plans

IGO certainly has an interest in Australian nickel miners ( would they offer shares or cash )

nobody is interested in PAN ( and i can't really blame them )

is there any other player( s ) out there , the market suspects a higher bid coming

Operations and Guidance Update
Mincor Resources NL (ASX: MCR, “Mincor” or the “Company”) provides the following operational and
guidance update.
Mincor combines ore from its Northern and Southern Operations to deliver a blended product to
BHP’s Kambalda Nickel Concentrator. This ore is subject to product specification requirements,
including a nickel-to-arsenic ratio.
During the ramp-up period, Mincor has delivered off-specification product. Whilst BHP has been
accepting off-specification product, both parties have been working together to explore and trial
methods to better manage off-specification product going forward. This work remains ongoing.
Mincor recently initiated discussions with BHP regarding potential amendments to the off-take terms
to provide ongoing flexibility with respect to product specification requirements and provide Mincor
certainty as to its ability to deliver 100% of mined ore to BHP. Mincor was notified on Wednesday, 29
March 2023, that BHP would not agree to amend the off-take agreement specifications.
Given the lack of certainty regarding future acceptance of any off-specification product and the
incomplete status of potential solutions, Mincor has decided to withdraw its guidance (see ASX
announcement on 7 March 2023).
Mincor will continue to deliver on-specification ore to BHP and is conducting work to improve
orebody knowledge to enable optimisation of its forward mine plan to consistently deliver onspecification product. Mincor will stockpile any ore that BHP indicates will not be accepted due to
product specification requirements, allowing for blending with other Mincor ore sources at a
subsequent date.


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DYOR

i hold MCR ( 'free-carried' )

divs4ever said:

Operations and Guidance Update
Mincor Resources NL (ASX: MCR, “Mincor” or the “Company”) provides the following operational and
guidance update.
Mincor combines ore from its Northern and Southern Operations to deliver a blended product to
BHP’s Kambalda Nickel Concentrator. This ore is subject to product specification requirements,
including a nickel-to-arsenic ratio.
During the ramp-up period, Mincor has delivered off-specification product. Whilst BHP has been
accepting off-specification product, both parties have been working together to explore and trial
methods to better manage off-specification product going forward. This work remains ongoing.
Mincor recently initiated discussions with BHP regarding potential amendments to the off-take terms
to provide ongoing flexibility with respect to product specification requirements and provide Mincor
certainty as to its ability to deliver 100% of mined ore to BHP. Mincor was notified on Wednesday, 29
March 2023, that BHP would not agree to amend the off-take agreement specifications.
Given the lack of certainty regarding future acceptance of any off-specification product and the
incomplete status of potential solutions, Mincor has decided to withdraw its guidance (see ASX
announcement on 7 March 2023).
Mincor will continue to deliver on-specification ore to BHP and is conducting work to improve
orebody knowledge to enable optimisation of its forward mine plan to consistently deliver onspecification product. Mincor will stockpile any ore that BHP indicates will not be accepted due to
product specification requirements, allowing for blending with other Mincor ore sources at a
subsequent date.


===========================================================================================

DYOR

i hold MCR ( 'free-carried' )

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Interesting scenario IMO, is BHP playing hardball to squash Twiggies takeover and then pick them up themselves after.
Is Mincor ore too difficult to deal with? I would think that is improbable
, as they have several sources of ore from multiple areas, that are fed into the Kambalda plant, so why would blending be an issue?
So what is going on? I wish I knew.

sptrawler said:

Interesting scenario IMO, is BHP playing hardball to squash Twiggies takeover and then pick them up themselves after.
Is Mincor ore too difficult to deal with? I would think that is improbable
, as they have several sources of ore from multiple areas, that are fed into the Kambalda plant, so why would blending be an issue?
So what is going on? I wish I knew.

Click to expand...

leaving the door open for a third player , perhaps


maybe BHP is thinking the OZL assets will replace the MCR contribution ( as they might once the OZL nickel assets are developed )

BHP decisions in recent years have not been the sharpest ( could BHP be seeing a drop in nickel demand and being reducing feedstock without being obvious ? )

Wyloo supplementary bidders statement out today.
Not going to increase price due to the recent rejection of ore by BHP.
Can't see BHP working to help Wyloo out.
Maybe they will let Wyloo buy MCR then shut them out completely, before buying the lot from Twiggy.
Mick

DrBourse said:

If you were in MCR late last week, you have obviously done very well, although I have no idea what would have made anybody want to buy MCR in the last 10 or 11 months – as it’s been a bit of a Pullback over that time…..

TA for MCR produces an odd Combination of a perfect Benchmark Candle Formation AND a Combination Benchmark Candle Formation that just happens to produce a Centre Line @ $1.44, that’s about where todays SP is hesitating, interesting to say the least..

The High Point of the BC reflects the maximum that punters are willing to pay for MCR over recent times, so a Sell on the CCI & MFI signals for 23/1/23 was a great move.

The Low Point of the BC reflects the minimum that punters are willing to sell MCR atm.

The Centre Point $1.44 is obviously related to the current Wyloo announcement’s.

The problem for anyone wanting to Buy in now is that they have no idea which way the MCR SP will go next.

MCR’s IV atm is about $1.16. – it’s a nightmare situation – Buy and you will prob loose – wait and you will miss the boat.

I always avoid situations like this – too many unknowns, best to move onto another stock IMO.

View attachment 154750
Cheers.
DrB

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MCR heading the predictable and correct ST direction IMO......

MCR have come out and said the holders should accept the Wyloo offer.
Guess that's it then.
Mick