PNN - Power Minerals

[UraniumLover]

PNN is out of control. It could take the first place for the race to producer in Australia amount the junior hopeful. The speed of dash is beyond my imagination. But it is understandable.

A good company with almost everything taken care of. In a good state, advanced in project, financially sound, strong Chinese backup, and Chinese customers as well.

Yes has everything going for it. Sino backing, almost certain change in gov, near term production (2011) - 'was' relatively cheap when compared to peers AGS etc, but at this rate not sure for how long ..
That picture of the new drill they acquired as well probably icing on cake..
Still surprising to see it move so fast, not that I'm complaining
:1luvu: PNN :1luvu:

 

[insider]

I don't own a single share but I picked this baby in the stock tipping competition... Nini Nini he's our man, if he can't do it no one can

 

[mmmmining]

The deal with Chinese is sealed. I am in tears, not sure it is for happy or sad...

 

[56gsa]

assuming AGS is valued on NPV basis:

AGS
mkt cap $645m
possible resource still not JORC (25% of 40kt total) 10,000t

PNN
mkt cap $153
JORC resource 6740t (so 67% of AGS resource)

67% of $645m = $431m / 68.7m PNN shares

=> PNN share price $6.33

this is all guess work and can't compare apples and oranges etc etc but if you take the implicit SMM valuation from Avera's buy-in as US$30/lb:

for PNN
14.828m lbs U * US$30 / 68.7m shares

=> PNN share price of US$6.48 / approx A$8.00

which is why you're crying mmmmining cause no ones taking it over now with Sino on board - or can they?

 

[UraniumLover]

this is all guess work and can't compare apples and oranges etc etc but if you take the implicit SMM valuation from Avera's buy-in as US$30/lb:

for PNN
14.828m lbs U * US$30 / 68.7m shares

=> PNN share price of US$6.48 / approx A$8.00

which is why you're crying mmmmining cause no ones taking it over now with Sino on board - or can they?

I'm loving this 56gsa, PNN has been stablising with solid support around 2.60.
Already has JORC in the friendly state of SA with the strong possibility of doubling it's u resources from around 20 mt. This doesn't even take into account the new drill they bought on sino backing to drill in the masgrave region using historical information which comes in May .... they can now drill a hole whenever they feel and make an announcement if they wish every time they find something hehe
It even compares well to what BMN has found so far without JORC underlying the potential when you take into account the SA laws should chane on Monday. Yet volume is down with everybody targeting AGS due to mike rann vamping .. his grandma must own it lol

 

[Pommiegranite]

Having briefly reviewed last years accounts:
http://www.pepinnini.com.au/media_releases_files/Pep_AR06.pdf

...one thing stands out (besides the usual losses of exploration companies ):

..at current expenditure levels, PNN has only enough cash ($1.4million) to fund exploration for 2 more years.

Does anyone know where they will be getting more money from to fund further exploration...and at what point do you expect them to start getting some income? Surely the idea of any non-charity is to make a profit?

Thanks
PG

 

[sleeper88]

Having briefly reviewed last years accounts:
http://www.pepinnini.com.au/media_releases_files/Pep_AR06.pdf

...one thing stands out (besides the usual losses of exploration companies ):

..at current expenditure levels, PNN has only enough cash ($1.4million) to fund exploration for 2 more years.

Does anyone know where they will be getting more money from to fund further exploration...and at what point do you expect them to start getting some income? Surely the idea of any non-charity is to make a profit?

Thanks
PG

Sinosteel will pay PNN A$28.5 million for a 60% stake in Cumamona project.
Thats plenty of cash for exploration!..and Sinosteel will commit $11m in exploration expenditure over 2 years.
If that is insufficient, they'll raise capital through placements and SPP etc
As for production, it may still be a way off.

 

[nizar]

This stock looks a winner.
I have heard of it but havent looked into it until now.

With chinese backing, SA region, an advanced deposit, and a market cap about 1/3 of AGS, this looks like a winner to me.

I will be looking at an entry this week. But which one to chop now that is the question........

 

[Sean K]

Been watching this for an entry into another SA U player.

Has been consolidating of late after a dramatic run from $1.50 to $3.00 in a couple of weeks. Now found support at $2.50 and stabilised a bit. Currently $2.65 ish.

70m shares @ 2.65 = $185m

Sinosteel JV PNN 40%

Curnamona Project (South of Gould’s Dam, NW of Radium Hill, W Honeymoon)

26 known U prospects other than Crocker Well and Mt Victoria

Crocker Well
19.8m lbs U cut off 250 ppm
14.8m lbs U cut off 300 ppm

Potential to be in production in 3 years (from the company)

[QOUTE]PepinNini’s General Manager, Mr Phil Sutherland, said Crocker Well was now a highly advanced uranium project, and should be in production in three years time. “The likely cost will be around A$160 million and provide around 100 permanent jobs once the mine is commissioned,” Mr Sutherland said. “This seems like a big call but Pepinnini is already favoured by having the Chinese Stated-owned SinoSteel Group as a 60% strategic partner and shareholder,” he said.[/QUOTE]

They have another 10 prospects identified in the vicinity of Crocker and Mt Victoria where they have found high grade surface samples (greater that 2% U.

Any opinions?

http://www.pepinnini.com.au/

 

[Punter]

So far I get

19.8mil lbs(40%) owned = 7.92mil lbs

PNN mkt cap about $180m.

re: exploration potential - surface samples don't mean too much. I saw the anomalies and they looked small.

Currently exploration potential aside(every u company has exploration of some degree), its valued at $22/lb of every pound in the ground.

 

[Sean K]

So far I get

19.8mil lbs(40%) owned = 7.92mil lbs

PNN mkt cap about $180m.

re: exploration potential - surface samples don't mean too much. I saw the anomalies and they looked small.

Currently exploration potential aside(every u company has exploration of some degree), its valued at $22/lb of every pound in the ground.

That's not that flash is it.

Damn hard to find anything undervalued now.

Chart for what it's worth. Might have been good value just year ago. Missed the boat on another one....

 

[Punter]

Thats right kennas. With index hitting new records it is not easy. Don't be fooled by PNN's low SP, low SP doesn't mean its cheap. Thats why I am in higher risky stuff like ERN and MTN. Those are high risk but if they hit deposits they might find stuff. $22/lb PNN, you might as well open a Canadian broking account and buy Uramin or Forsys metals, coz they probably sell cheaper and have bigger projects.

 

[56gsa]

I think you're right - this is no longer the bargain it was - with the 40% share in U deposit now my valuation above looks more like a $3.20 value for PNN

There are some other factors though that may drive sp above this:
- drilling on other U potential sites could increase U resource
- drilling on musgrave nickel/copper area seems to have potential

Also 21m shares have just been released from escrow - you'd think logically this would dampen price but in the past I've seen this have the opposite affect - not really sure why - can someone explain - is it because theres more volume bigger players can get in without pushing price up too much? PNN has traditionally been a very low volume trader...

 

[Punter]

I think you're right - this is no longer the bargain it was - with the 40% share in U deposit now my valuation above looks more like a $3.20 value for PNN

There are some other factors though that may drive sp above this:
- drilling on other U potential sites could increase U resource
- drilling on musgrave nickel/copper area seems to have potential

Also 21m shares have just been released from escrow - you'd think logically this would dampen price but in the past I've seen this have the opposite affect - not really sure why - can someone explain - is it because theres more volume bigger players can get in without pushing price up too much? PNN has traditionally been a very low volume trader...

Agreed. If they hit another crocker well it will go up, but remember the 40% stake applies to other deposits it finds as well. It more and more resembles AGS, but it lacks the WOW factor of AGS's grades.

 

[Mr_S]

So what does everyone think of this company? I'm looking for a solid and profitable small mining company to invest in longer term.

This company looks interesting to me compared to all the new uranium explorers popping up everywhere. Pepinnini already has proven reserves of uranium plus the potential to double this (I may have misinterpreted this) from what I've been reading in their statements. They are getting a lot of money from Sinosteel over the short term, and with their cooperation it seems they could possibly fast track the company's resource portfolio, especially taking into account their very own drilling rig.

How many other uranium companies are capable of mining uranium in three years and have a solid entrance into the Chinese market? Most seem to only be talking about looking for uranium soon.

Maybe I'm wrong, but this one looks to be one of the more profitable small resource companies in Australia, even if they don't have the huge amounts of uranium like Paladin. They aren't just narrowing themselves to uranium which I think is a big plus too.

What do you guys look for in uranium/spec mining companies? Any of you guys looking for longer term investments in the resource sector?

 

[Mr_S]

I'm pretty confident I've found a good place to buy in. haha I was planning on entering around $2 but I'm happy with below that. Seems there's not much interest at the moment in PNN or AGS lately. Can't wait for more info on their nickel and uranium drilling. Things should change after that.

 

[56gsa]

This was an old favourite but has fallen hard since April from its $3.30 high. Has it bottomed?

IMO worth looking at again for one reason - management has announced they will buy-back 4.9million shares over 12 months because they don't think price accurately reflects the value of company (scared of takeover??). With only 69m in total this is not insignificant. So what price will they start buying in? Well there is a buy now at 1.15 for 130k which is the average daily volume for the last three months - is this the company? (is anybody able to check this?) Does this artificially provide support and break the down trend?

prospects still remain as above - uranium (JV with Sino) and nickel - with drilling happening at both atm

 

[Rafa]

been pretty quite on the PNN thread for a while...
Their quarterly report has just been released...

Some of the Highlights:
♦ Discussions have been held with consultant groups and South Australian Government Departments to establish guidelines and a development timeframe for the development of the Crocker Well Uranium Deposit. Current strategy is aimed at being in production by 2010.
♦ Independent resource consultants Hellman & Schofield have been commissioned to upgrade sufficient current JORC compliant uranium resource at Crocker Well from an Inferred category to an Indicated and Measured category to allow for a Definitive Feasibilty Study to be undertaken for the development of the project.
♦ At the end of the quarter the Company held $32.95million in cash. (not bad for a market cap of ~ 100m)


Few more details:

New Adelaide office officially opened by Hon. Paul Holloway, MLC, South Australian Minister for Mineral Resources Development on 10th September, 2007.

Office premises have been established in Adelaide for the Joint Venture Management Company which will undertake further exploration with a priority objective of preparing a Bankable Feasibility Study for the development of the Crocker Well Uranium Deposit to produce at least 600 tonnes of U3O8 per year for at least 10 years. It is the intention of the Joint Venture to get into production as soon as possible to take advantage of the current uranium market.


Chart Wise.... it threatening to form a base, tho nothing has been confirmed yet... Would appreciate any further TA insight.

Is there something I am missing here as to why the SP is so low??? (besides the obvious that the market always knows...)

 

[PBH]

Remember, the company is currently engaged in share-buyback, so they won't be doing anything to push the price up too far just yet... but when keeping an eye on trading volumes you kind of get the idea that they've been quite busy at these levels, which bodes well for the future..

Furthermore a lot is still dependant on the outlook of uranium prices in the medium to long term, which in turn seem to be very much contingent on the fortunes of the huge Cigar Lake project.

Personally I'm quite bullish about the prospects of uranium prices, especially as the water-logged Cigar Lake mine doesn't seem to be going anywhere in a hurry, and thus am happy to hold and even acquire PNN shares at the moment.

Also I think PNN is very close to a breakout.

 

[Rafa]

Got on board on Friday...

the Chinese, the plans for the new mine by 2010, the cash on hand... the new office and the chumminess with the ministers... and this share buy back (only logical given the low SP)...

But something must be brewing...
I really do think of the two rivals to AGS for the next new mine in SA are MTN and PNN... and PNN might be winning the race.

The issue with PNN tho, is their stake in the mine... In dollar terms, what is that worth to them, and what share price reflects that value?