RMI - Resource Mining Corporation

[GOOGOOJEE]

whats goin on with the sp, drops another 9% today............... people are just too scared to hold their shares....................Hope this will be the bottom of it.........

 

[KIWIKARLOS]

Mate these guys were always heaps spec, the deposit is in rough terrain in a wild country will low grades and huge infrastructure costs. If there is a credit crunch (im not betting on it) these types of companies will be the first to fizzle.

 

[Gurgler]

If there is a credit crunch (im not betting on it) these types of companies will be the first to fizzle.

Well we seem to have come back to (almost) the same level as before RMI's most recent surge. Where to from here? Have we bottomed yet?

I guess we'll see. 200 point drop overnight on the DOW. Are we entering uncharted/unchartable territory?

 

[zhang9288]

Looking forward to news.

RMI is holding up niceley after yesterdays run.

With a little good news we should see a return to 10cents hopefully.

 

[skiper]

Zhang, spoke to the office lady who openly told me there was news coming out Friday, when i quized her she said about the Nickel of course, which may explain some of the buying over the last couple of days:sheep: Watch them all flock back:

 

[Gurgler]

Looking forward to news.

RMI is holding up niceley after yesterdays run.

With a little good news we should see a return to 10cents hopefully.

Zhang - don't know what you make of this 10 day chart, but it will need some very good news Friday to reach your target. On the other hand, tonight or tomorrow night, the DJIA and the S&P500 may just throw a wet blanket on that. Good luck to all.

 

[tibby]

Zhang, spoke to the office lady who openly told me there was news coming out Friday, when i quized her she said about the Nickel of course, which may explain some of the buying over the last couple of days:sheep: Watch them all flock back:

Hey Skiper...I too have been in contact with the company (Julie Hill) as I wanted to know about the GPR results being released, I was assured it would "nearing the end of the week"...that was on Monday...so should be very close

 

[INORE]

Seeing as there is an announcement out soon i thought this may freshen memories and help rate/justify the SP on any results that may be announced...not sure whether the elusive YT would care to update his most excellent analysis...thanks YT.

Guys sorry it took me so long to get this done, but have been trying to trade while researching/typing etc etc

RMI​

Mkt Structure

Shares
430m
Mkt Cap @ 7c = $30m Current
Mkt Cap @ 15c = $65m Target 1
Mkt Cap @ 20c = $86m Target 2

TOP 20 = 52%
Substantial Shareholders
Sinom (Hong Kon Stell/Iron ore Insto Group) 13.4%
ANZ 8.4%
Mount Gibson Iron MGX 7.4%


Cash
$2m not alot so will obviously need more down the track


Projects



Wowo Gap Nickel, 100%, PNG
120mT@1.2%Ni + 0.1%Co = 1.7%Ni Equiv

Note that my research on Wowo Gap has found that based on all the historical work, the PNG government is confident to quote a JORC of
300Mt@1.6%Ni Equiv

Valuation
As its a laterite Project I'd say once the JORC is firmed up a $1000/t EV is appropriate (Note Spot $35k - $50k/t)

For now until we recieve assays and confirmation of the mineralisation I will use $100/t Ni EV

120Mt@1.7%Ni Equiv = 2Mt+ Ni @ $100 = $200m = 47c RMI

Now the mian points are
1. Although the current JORC has a low confidence level, detailed research of PNG databases has revealed a JORC of 300Mt@1.6%Ni Equiv is being quoted, so there is plenty of upside to the jorc, this in turn has greatly increased my confidence in the project.

2. Given the huge technical and infrastructure costs, a JV with a major is a must! = Farming out/down of interest, but see HIG, they sold a majority stake in Ramu (145Mt@1.5%Ni Equiv) to the Chinese so a JV partner shouldn't be a problem


Blackstone/Michael Hills Ni/Cu/PGE/PGM, 25% Free Carried by RDS, Musgrave Province W.A.
The project is 30Km's away from WMC's Babel and Nebo Nickel Sulphide deposits,

While its early stages, Patersons are highly encouraged by the work so far and belive that RDS/RMI are onto something quite promising here

Valuation
I like Patersons fully agree that the bulk of RDS's current mkt cap is attributable to these projects,
Hence a comparative valuation can be made

RDS 90m shares @ $1.40 = $26m for 75% Interest

Thus RMI's 25% Interst is worth $42m = 9-10c approx RMI


Argyle Iron, 75%, W.A. near Wyndham
JORC 17Mt@55%Fe

Unfortuantely this deposit is somewhat stranded and RMI will need to show a clearer path to development before I will value it properly,

However apparantly their has been strong Chinese interest in a potential JV, once one appears I will re value this project

Valuation
As stated, due to development uncertainty the project only deserves an EV of $2.50/t vs $5/t I was happy to use for CUL's

17Mt@55%Fe = 9.35Mt, 75% Interest = Net 7Mt's Fe
7Mt's Fe @ $2.50/t = $17.5m = 4c RMI

If a chinese JV or clearer path to development appears I will be happy to use $5/t = 8c RMI




Qld 3 Rivers Ni/Cu, 10% Free Carried by SRL, Greenvale Qld
SRL should have drilled 3 deep holes to test for NI/Cu sulphides, not sure where this project is at



Summary

- WOWO could be a company making project, remember JRV's run? 400% in a month based on its huge laterite Nickel Project
- The RDS JV underwrites/implies an SP of 9c-10c
- The Argyle Iron Ore Project adds 4c in spec value (8c once I see JV etc)


Total Value I see pre Wowo Gap rerating = 23c
After more confidence in Wowo = 40c+

 

[prawn_86]

i still think these guys are way underpriced, as per YT and my analysis many weeks ago.

try finding me another company whose market cap is less than 0.1% of its NPV.

also, for the people who are worried about cashflow problems consider this:

if RMI was unable to find a JV partner or raise capital (highly unlikely) then if it were to sell only its Wowo project one would safely say that $50million is a minimal figure which they would easily get.

this $50mill is still about 60% higher than the current market cap.

just another way of looking at how wowo has not even begun to be factored into the SP.

enjoy!

 

[YOUNG_TRADER]

Hi guys,

Well there's nothing to update really hence why I haven't made a comment,

The SP has gotten absolutely smashed, but then so have most spec's although I felt the pain more on RMI, can't believe at one point it was at 4.1c!!!!!!!!!!!!!!!!!!


Once company releases some results, then they'll be something for me to update

Cheers,

p.s. still waiting for capital raising, they need money based on their last qtrly, pity they didn't try and raise it when the SP was 14c

 

[INORE]

Well a few people selling out now....perhaps cos of the weekend nerves and i must admit i allmost did too....but most of the trades that went through today were above 8c so i beleive that may add some support....perhaps the announcement was sent to the ASX yesterday/today hence the delay in getting to market...hoping on an after market closes announcement....

Tibby or Skiper, you's wanna call rmi and ask them WTF?

 

[prawn_86]

yeh i woke up hoping for a ann symbol next to rmi this morning and yet it hasnt come up all day.

patience is the key, it was always my plan to hold to the announcement, so another weekend wont hurt

 

[juw177]

Was there not some word of an annoucement coming up? Or was that just a ramp? If so it worked because Friday's SP spike was probably due to people believing there was an annoucement. (Yes I was one of those people that bought in a few days ago)

 

[prawn_86]

im not sure of the specifics as i havnt rang the company, but a wowo announcement is well overdue, even taking into account the delay they mentioned in their quarterly

 

[tibby]

im not sure of the specifics as i havnt rang the company, but a wowo announcement is well overdue, even taking into account the delay they mentioned in their quarterly

Hi Guys....I was told last Monday that an announcement would be due regarding WOWO project "nearing the end of the week" I have since been informed by Julie Hill via email that they are planning to ..........."release an announcement early this week which provide an update on the exploration progress at the Wowo Gap project"

 

[INORE]

Hi Guys....I was told last Monday that an announcement would be due regarding WOWO project "nearing the end of the week" I have since been informed by Julie Hill via email that they are planning to ..........."release an announcement early this week which provide an update on the exploration progress at the Wowo Gap project"

thanks for the follow up tibby...Is Julie Hill a director? Lets hope its a positive announcement.........

 

[juw177]

Julie Hill is the company secretary according to ASX website. I am holding and will top up if the ann is good.

 

[tibby]

thanks for the follow up tibby...Is Julie Hill a director? Lets hope its a positive announcement.........

No problem inore..........Julie Hill is the Company Secretary. Will wait and see I suppose as to when the announcement actually comes out, I will be watching sp very closely as there are a few traders out there that jumped on late last week to have a punt on the announcement....you would like to think that people would wait until the announcement comes out to make a decision...

I have a question for anyone out there that may have been looking ouside the square on this one....does anyone know if the rainfall in PNG has been unusually high as stated in the last quarterly. This was one of the reasons for the GPR results delay, just dawned on me that I never actually checked if that was true, exaggerated or whatever...just nit picking I supose

 

[Mazrox]

Got all excited when I saw the "news" icon up .... but just a notice re options for the consultants.

(Sigh) I guess I can wait a bit longer...

(Investing and trading in shares really does help develop your patience!)

 

[tibby]

Hi Everyone,

Just had contact with the company and got a few answers from Alicia Pugh. Thought I would post a few comments that I took from it.

Rain in PNG has still be unpredicatable, but the work rate has improved substantially.

GPR results at Wowo are close to being completed and the delays have been due to technical problems on the part of the contractor supplying the service.

Drilling will be complete on the main resource by October. There will be announcement very soon updating the progress with the Wowo project.

Not alot of info I know. But gives a start on what we can expect in the announcement. GPR results still not completed, I believe the last quarterly was aiming for 2-3 weeks.....