QOL - Queensland Ores

[jooooooles]

Coudn't find any postings on this company under Q-Z under the forums.

Here is a breif outline on what well could be Australia's first molly producer. The company has a fully funded Molly / Tungsten project 100km South West of Cairns and is expected to start mining in the last quarter of 07 (within 6 months)

Currently has a market cap of less than 40 million. Will be producing 150,000 tonnes of ore per year with JORC MoS2 grade 0.17% and JORC WO3 grade 0.41% with a mine life of 6 years. Commissioning of crushing equipment expected to happen between Dec - Jan. There is huge potential to increase the current JORC resource as well/

Molly prices currently fetching around US $32 / pound and Tungsten US $250 / MTU - unlike other explorerd who are + 5 years of becoming producers QOL is likely to be there within 6 months. Huge potential to take advantage of strong rising prices particualry for molly with some analysts predicting that it could top US $50 / pound in the near future.

The project was fully funded through a right's issue and the company will be generated a cash flow within first quarter of 08.

They have just signed off on the native agreement and lodged their EPA application for public review which hopefully will be completed and lodged in Aug - Sep

Interesting link to have a look at which mentions QOL http://www.thormining.com/docs/downloads/tungsten21June07.pdf

Company also has a copper/gold project and is hoping to be a 2 mine operating company within 2 years.

As always DYOR

 

[prawn_86]

have to say that after a weekends worth of research i decided to buy in at 32c.

happy to hold for a couple years, especially with such good exposure to moly and the copper and gold potential.

does anyone know if their moly is hedged? as i couldnt find that info anywhere.

 

[doogie_goes_off]

Did my research last week too, price moved before I could act. Thanks for alerting ASF'ers to QOL jooooles. I'll be looking for an entry point.

 

[prawn_86]

depens on what your hold strategy is but i can see it being well above curreent prices by the end of the year. at least 40c by december imo

 

[Who Dares Wins]

Any ideas on how much it will cost to mine the ore on a per tonne basis? it would help to know this to evaluate the company.

Could be above that 40c mark sooner than some think the way its going. Strong again today so far.

 

[jooooooles]

No problem guys - this one isn't going under 30 cents any time soon I beleive. Up a massive 13% today with some huge buy orders going through - turned into a bit of a frenzy at one stage.

Excellent support

Quantity Price
114,955 33.5
350,000 33
150,000 32.5
290,000 32

To think this still has a market cap around 40-45 million is absolutely bewildering to me. Still priced as an explorer - will be generating cash flow around 6 months 9 at the absolute latest. Considering some of the U plays out there who have market caps in excess of $100 million and won't be minning until well over 3 years with so many risks and unknowns is staggering. So many boxes are ticked off for this one and with Native title just signed off on last week and the EPA being lodged for review.

Considering also that fact that the options (QOLOA) are being snapped up at an 10 cents. These have an excess of 35 cents (Need a SP of 45 cents to break even!!!) That means that who ever is buying them is behind the 8 ball already. Punters are looking to leverage their holdings and returns one would assume and who ever is buying them seems pretty confident.

Who dares wins - have a look at the link in the first post I did - there are some 'base calculations' on QOL on the last page.

I forgot to mention they also have a copper / gold project as well read the annoucnements. They plan on being a 2 mine producer within 2 years - the first being Wolfram around about 6 months.

There is also the potential to upgrade the resource tonnage at Wolfram. They are still drilling and results are pending as well.

Also interesting to note molly is extremely bullish and many analysts beleive that US 50 / lb is a 'heart beat away' -

As I just finished typing it has shot up 34.5 up 15 %

DYOR as always and make your own conclusions regarding this company

Jooooooles

 

[porkpie324]

There are some posts on QOL on the commodity section, I managed to pick up some this morning at .33, did'nt go to mad, may be some anouncement temp buying pressure. porkpie

 

[prawn_86]

here is an email i recieved from the MD this morning with regards to a few questions i asked.


Hi Shaun

Thanks for the email.

In relation to your questions please note the following:

1 QOL will be attending a lunch at the Melbourne Mining Club in
July and currently uses Farringtons to manage PR.

2 The announcements planned include further progress relating
to the Wolfram camp mining lease leading to mining commencing in Dec
2007 and production in early 2008. The direction the board has taken is
that once WC is up and producing then Mt Cannindah, a copper and gold
project in Monto will be developed with the intention of production
commencing in 2009.

3 The cash forecasts currently show that the current cash
holdings will take the Wolfram Camp thru to production. At this point in
time there is expected to be no further dilution of shares with the next
movement expected to be the exercise of options in Nov 2008

4 Please see attached


Regards

Peter Birch


1. does the company have any PR planned? if so will they be handling it
internally or externally

2. what announcements/results are planned over the next 6 - 12 months
and what is the long term vision/forecast of the board?

3. How long is the current cash in bank expected to last? will there be
any further dilution of shares?

4. Would it be possible to gain a list of top 20 shareholders?

I look forwards to your correspondence and may have further questions in
the near future.

Kind Regards

Shaun

 

[alankew]

Shaun thanks for that,is it possible to put up the list of the top 20 including the percentages held.Thanks in advance

 

[prawn_86]

im not at my normal computer cause im visiting my old man, so i'll have to wait till the weekend to put up the list.
but the talbot group (ken talbot) of macaurthur coal (i think) is the major holder with about 8%. the top 20 totals around 38%.
real figures will come on the weekend.
sorry for the delay.

 

[BIG BWACULL]

E TURD (E TRADE)website has this to offer atm hope it helps,
07/08/2006 Donwillow Pty Ltd 9,765,000 18.92%
20/12/2006 Talbot Group Holdings Pty Ltd 8,100,000 13.66%
31/01/2007 Rigi Investment Pty Ltd 4,100,572 5.98%

 

[mick2006]

very interesting day's trading for QOL, all time record volume with a steady stream of large 100k plus buy orders. One would think a bit of accumulation going on.

The research paper from Far East Capital could very well be attracting a fair bit of new interest into QOL.(available from QOL website very interesting read)

What we do know is that QOL is going to be the first in a new breed of Molybdenum/Tungsten producers in Australia with first ore mined late 2007 and first sales early 2008.

With a excellent outlook for both commodities and near term production/cashflow, QOL should benefit from a large re-rating as it gets closer to production.

Also very interesting to note the very high grade molybdenum, with grades around 4 times higher than that of DGR's project.

 

[Ken]

I am a fan,

But chart wise is this right time to be buying? 26 cents to 35 cents. Will there be profit taking if the buyers are done for the short term?

If the buyers have there stag, and it sits around current levels.. slowly but surely the impatient sellers will push it down.

Just reminds me of ELK a bit, not saying its not going north, just trying to find myself an entry, and history has told me, majority of the time, you will get an opportunity.. after some decent gains, which QOL has had.

 

[jooooooles]

Closed above the 34 cents mark. This is first time since May. Maybe we are looking to break 40 cents mark?

Since posting this one in the forum last week I am really surprised about the response. Seems a lot of punters like the QOL story including myself. Looking very strong in pre open already - punters scrambling in to get cheap stock before it might take off again - this is a possibility.

DYOR as always

 

[Spaghetti]

Sold out of this stock in April for .415. Could not understand then why it wasn't go ballistic but was soon after a rights issue or something I do not understand. Saw the company on TV over the weekend talking with the locals and generating a lot of interest so jumped back on without any thought yesterday and paid the highest price of the day. Still far cheaper than my sell price in April I tell myself lol

I remember reading a broker report on the QOL website that gave a very healthy price target if I recall correctly. Sure it was included on the prospectus, anybody else seen it? Cannot for love or money find it now. Do not want to quote it without providing support.

 

[Spaghetti]

Found it, under capital raising presentation March 2007. Not an independant broker report so will not quote here, their estimates I guess. Anyone can read on the website.

 

[mick2006]

hey guys have had this one on my watchlist for a while now and have been buying small chunks here and there, hoping to get a decent position. But judging by the movement today on good volume the market is finally waking up to QOL.

It will be Australia's next Molybdenum and Tungsten
producer with mining to commence in the 4th quarter and first sales in the 1st quarter next year.

It has the jump on many other of the near term producers such as THR,PDM,VML.


So a look at QOL and its projects


Share Structure

Shares 138,381,153
Options 34,730,192


Market Cap

$58,857,857



Reasons to buy into QOL

- Exposure to hot commodities in Molybdenum/Tungsten
- 2 mining operations by early 2009
- Wolfram Camp mine already fully funded and due for production 4th Quarter 2007
- Mt Cannindah (copper/gold/silver) due to come online early 2009
- High potential for resource expansion in immediate proximity to producing mines.
- First in new breed of Molybdenum producers
- Will be generating profits in first year of production
- plenty of Shareprice upside due to stock re-rating as mine commencement gets closer.
- undemanding p/e of 1.5 based on current share price.
- top 50 shareholders control 57% of the company (thanks Shaun)

Wolfram Camp

Production to start late 2007, with first sales early 2008.

To produce on a yearly basis

- 229,000 lbs of molybdenum
- 41,820 metric tonnes (MTU) of Tungsten

Annual sales of $21 million

Costs of $9.3 million

Profit of $11.7 million



Mount Cannindah

Feasibility Study complete early 2008
First Ore 2nd quarter 2009

Yearly Production of

- 8200 tonnes copper
- 5950 oz gold
- 275,000 oz silver

Total sales of $67 million per yer

Profit of $27 million per year



With over 3km strike left to explore at Wolfram Camp, QOL believes that they will be able to tripple the current resources.

The two main projects above will keep QOL busy over the short term they have several other exciting prospects being Banford Hill and Triple Crown.

If you take the potential profit of $38 million from the two projects it leaves QOL with a fully diluted

EPS 22 cents
P/E 1.5

Shows how much potential upside there is with QOL if you use the standard P/E of 10 it would give you a share price of around

$2.26

I would like to add that I am not saying that QOL will reach $2.26 but this is used to highlight the potential of the company.

Also the commodity price used for the calculations are as follows

Molybdenum $25 per lb
Tungsten $250 per MTU
Copper $2.50 per lb
Gold $650 oz
Silver $10 oz

All of the above commodities are trading significantly higher than the price assumptions used by QOL, which could add even further upside to the company.

Below is part of an article from Far East Capital

Prospective Tungsten Producers
“Update Shows Qld Ores is Leading the Pack, Boosted by Molybdenum”
The Molybdenum Co-Product is Adding to the Appeal of Some …
Molybdenum Price Has Been Stremgthening: The tungsten market has been overshadowed by the
surge in molybdenum prices from US$25/lb in February to US$33.50/lb at the end of May.
• The market has woken up to the fact the non-corrosive qualities of molybdenum make it an
essential element in construction of pipelines for the oil industry and in nuclear power plants.
The problems with leaking oil pipelines, such as we have seen in the Alaskan pipeline, can be
avoided if molybdenum is used in the steel. Currently approximately 66% of the oil pipelines in
use have to be replaced as their steel doesn’t contain molybdenum.
• The desire for molybdenum amongst investors has been highlighted by the commissioning of a
new molybdenum investment fund by Sprott Asset Management in Canada.
• The value of molybdenum is highlighted by the observation that it has now reached the price that
uranium was fetching, two years ago.
Limited Molybdenum Entry Points: There is no direct entry into molybdenum production for
investors on the ASX at present.
• Australia’s first molybdenum producer will be Queensland Ores, due to commission its
mine at the end of 2007, or early 2008.
• Two prospective tungsten producers have molybdenum as a co-product; Queensland Ores
and Thor Mining. Only Queensland Ores has a fully-funded development project.
• Thor Mining is still in the pre-financing stage with no definite timetable for production, but
we do view it as a project of merit.
• There are a number of exploration companies with prospective molybdenum projects.
These will be covered in a report that we are currently working on. However, none of them
will be a producer in the short term ahead of Queensland Ores.
Debt Finance Difficult: Specialty metals projects, tungsten and molybdenum included, are very
difficult to debt finance due to the thin markets. Equity financing is essential. While there is merit
in seeking debt/quasi debt from end users or investment banks, as a means of minimising dilution,
these negotiations can lead to development delays and constrictions.
… But Tungsten Prices Have Firmed Up As Well
• The tungsten prices as quoted in the London Metals Bulletin, has remained strong. The price is
based on surveys of producers, consumers and traders. For the month of April, the average low
price was US$257/MTU. We have increased the price from US$220/MTU to US$250/MTU in
our spreadsheet, the lowest level it achieved in May.
• China is the largest consumer in the world. In the past it has subsidised mines, but the subsidy
levels have been diminishing and a number of mines have closed. Stockpiles are being drawn
down to satisfy demand so there is an expectation that prices will remain firm


Would be interested to hear peoples thoughts on the company.

Looks very good going forward likely to be heavily re-rated closer to the start of production.

 

[greggy]

hey guys have had this one on my watchlist for a while now and have been buying small chunks here and there, hoping to get a decent position. But judging by the movement today on good volume the market is finally waking up to QOL.

It will be Australia's next Molybdenum and Tungsten
producer with mining to commence in the 4th quarter and first sales in the 1st quarter next year.

It has the jump on many other of the near term producers such as THR,PDM,VML.


So a look at QOL and its projects


Share Structure

Shares 138,381,153
Options 34,730,192


Market Cap

$58,857,857



Reasons to buy into QOL

- Exposure to hot commodities in Molybdenum/Tungsten
- 2 mining operations by early 2009
- Wolfram Camp mine already fully funded and due for production 4th Quarter 2007
- Mt Cannindah (copper/gold/silver) due to come online early 2009
- High potential for resource expansion in immediate proximity to producing mines.
- First in new breed of Molybdenum producers
- Will be generating profits in first year of production
- plenty of Shareprice upside due to stock re-rating as mine commencement gets closer.
- undemanding p/e of 1.5 based on current share price.
- top 50 shareholders control 57% of the company (thanks Shaun)

Wolfram Camp

Production to start late 2007, with first sales early 2008.

To produce on a yearly basis

- 229,000 lbs of molybdenum
- 41,820 metric tonnes (MTU) of Tungsten

Annual sales of $21 million

Costs of $9.3 million

Profit of $11.7 million



Mount Cannindah

Feasibility Study complete early 2008
First Ore 2nd quarter 2009

Yearly Production of

- 8200 tonnes copper
- 5950 oz gold
- 275,000 oz silver

Total sales of $67 million per yer

Profit of $27 million per year



With over 3km strike left to explore at Wolfram Camp, QOL believes that they will be able to tripple the current resources.

The two main projects above will keep QOL busy over the short term they have several other exciting prospects being Banford Hill and Triple Crown.

If you take the potential profit of $38 million from the two projects it leaves QOL with a fully diluted

EPS 22 cents
P/E 1.5

Shows how much potential upside there is with QOL if you use the standard P/E of 10 it would give you a share price of around

$2.26

I would like to add that I am not saying that QOL will reach $2.26 but this is used to highlight the potential of the company.

Also the commodity price used for the calculations are as follows

Molybdenum $25 per lb
Tungsten $250 per MTU
Copper $2.50 per lb
Gold $650 oz
Silver $10 oz

All of the above commodities are trading significantly higher than the price assumptions used by QOL, which could add even further upside to the company.

Below is part of an article from Far East Capital

Prospective Tungsten Producers
“Update Shows Qld Ores is Leading the Pack, Boosted by Molybdenum”
The Molybdenum Co-Product is Adding to the Appeal of Some …
Molybdenum Price Has Been Stremgthening: The tungsten market has been overshadowed by the
surge in molybdenum prices from US$25/lb in February to US$33.50/lb at the end of May.
• The market has woken up to the fact the non-corrosive qualities of molybdenum make it an
essential element in construction of pipelines for the oil industry and in nuclear power plants.
The problems with leaking oil pipelines, such as we have seen in the Alaskan pipeline, can be
avoided if molybdenum is used in the steel. Currently approximately 66% of the oil pipelines in
use have to be replaced as their steel doesn’t contain molybdenum.
• The desire for molybdenum amongst investors has been highlighted by the commissioning of a
new molybdenum investment fund by Sprott Asset Management in Canada.
• The value of molybdenum is highlighted by the observation that it has now reached the price that
uranium was fetching, two years ago.
Limited Molybdenum Entry Points: There is no direct entry into molybdenum production for
investors on the ASX at present.
• Australia’s first molybdenum producer will be Queensland Ores, due to commission its
mine at the end of 2007, or early 2008.
• Two prospective tungsten producers have molybdenum as a co-product; Queensland Ores
and Thor Mining. Only Queensland Ores has a fully-funded development project.
• Thor Mining is still in the pre-financing stage with no definite timetable for production, but
we do view it as a project of merit.
• There are a number of exploration companies with prospective molybdenum projects.
These will be covered in a report that we are currently working on. However, none of them
will be a producer in the short term ahead of Queensland Ores.
Debt Finance Difficult: Specialty metals projects, tungsten and molybdenum included, are very
difficult to debt finance due to the thin markets. Equity financing is essential. While there is merit
in seeking debt/quasi debt from end users or investment banks, as a means of minimising dilution,
these negotiations can lead to development delays and constrictions.
… But Tungsten Prices Have Firmed Up As Well
• The tungsten prices as quoted in the London Metals Bulletin, has remained strong. The price is
based on surveys of producers, consumers and traders. For the month of April, the average low
price was US$257/MTU. We have increased the price from US$220/MTU to US$250/MTU in
our spreadsheet, the lowest level it achieved in May.
• China is the largest consumer in the world. In the past it has subsidised mines, but the subsidy
levels have been diminishing and a number of mines have closed. Stockpiles are being drawn
down to satisfy demand so there is an expectation that prices will remain firm


Would be interested to hear peoples thoughts on the company.

Looks very good going forward likely to be heavily re-rated closer to the start of production.

Hi Mick 2006,

Thanks for the tip Mick 2006. QOL looks very interesting and is set to go into production by late 2007, early 2008. Its also cashed up after an issue supported by Far East Capital.
DYOR

 

[Spaghetti]

I am going accumulate a huge parcel of QOL in the next three months. It still has one hurdle I believe, that is the environmental management plan approval so some risk attached. Their notices suggests all approval processes and the go-ahead should be October 2007, originally hope for August 2007. They are ready to roll now, just waiting for the approvals.

 

[porkpie324]

Accumalation is the way, just be aware that any hickups with issues to cause a delay in production will result in QOL shares being hammered, probably an oppotunity to accumalate a few more.porkpie