RMI - Resource Mining Corporation

[sting]

0.077 and rising I agree but we do need some ann. Tell me is it just quet or are companies holding info....RMI ADI AAR all have percieved positive news sp 's are up but no word or ann if we dont here something soon I can see these prices falling back again

semper ubi sub ubi

 

[greggy]

Hi Greggy,

Thanks for the ERL tip, did very nicely on that one and still got 100k oppies at 1c to come.

Been a very good week for RMI. I am surprised at the small number of sellers given that it has in the order of 425 million shares on hand. I think accumulation is occuring but they are have had to bring the SP up a bit to get some selling and at the same time I don't think they won't to draw attention by having another speeding ticket.

Nickel at Wowo gap and with RDS in the West Melgraves and they are both currently being drilled. Wowo Gap is the lateric variety but the RDS JV is the sulpher variety. Looking good for the future.

Kevro

Kevro,

Your most certainly welcome. I'm glad ERL has made you a good profit. As for RMI, to have 2 drilling programs for nickel underway, this is good timing indeed. With the nickel price going from strength to strength, any positive results are liking to have a strong impact on RMI's share price. RMI's share price has done well of late as the market has taken a strong liking to the smaller nickel plays.
DYOR

 

[Georgeb]

The Nickel and Iron Ore projects are a company maker and if my sources are correct expect a huge increase in price in the coming months.

 

[Joules MM1]

........and nice vols today

Only have to watch the volume to know that a news release is pending with this stock.........like a kitchen sieve ............today maybe a different ball-game.........I am long on this stock from .042 through to .052 and see more inside activity from deep-sea drivers ............

 

[prawn_86]

ok all, i believe its time i start contributing something back to ASF!!

this is my first real attempt at an in depth analysis so go easy on me, and i am more than happy to be corrected on any issues/calcualations.

RMI - Resource Mining Corporation​

Nickel play in PNG with other iron ore and cu tenants in Aus. Has its finger in many pies.
Is also sitting on a promising haematite iron ore tenement, which can only add value into the future.


WOWO
jorc inferred 120mt @ 1.2% ni and 0.1% cobalt
assume ni price of USD$35000 per tonne
cobalt price of USD$95 per pound

120mt * .012 = 1.4m
1.4m * 35000 = USD$5billion (or is it $50bill)

share on issue - 427542812 * sp of 6c = 25.6mill market cap

therefore, current market cap vs NPV of ni alone = <0.5% as all figures are in USD


Argyle Iron Ore
The Argyle Iron Ore Project is situated 120 kilometres south of the Wyndham in the eastern Kimberley of Western Australia

RMC is seeking to prove sufficient haematite reserves with respect to tonnage and grade to sustain an annual production and shipping rate of 1.0 to 1.5 Mt per annum


Advantages:
Outlined above, plus close access to river for shipping etc
Chinese board connection
lots of other tenaments
ANZ major holder (8.4%)

Disadvantages:
relatively unknown board
PNG issues
High cost setup of nickel laterite mines/processing
Other companies have faced similar issues at nickel laterite projects. Inco recently announced similar cost blowouts and delays at its $US2 billion-plus Goro development in New Caledonia

Other Info
3 other main tennants on which they are seeking JV or happy just to sit on.

I believe the wowo announcement will be the start of a re-rating.

Hasnt run yet, giving us time to set ourselves, as we did for FNT.

Already a JV partner with Straits (top 200 company) with their three rivers project.

50% held by top 20

www.resmin.com.au



please let me know what you think.
I hold from 0.058

 

[YOUNG_TRADER]

Nice work prawn,

Its great to see others doing analysis,

As I said to you, I like RMI I have been watching them for about 12 months, however their Iron Ore project is stranded and the Nickel project has a very low confidence level

So I will look at the stock when either of the following occur
1. A JV or clearer path for development appears at Argyle

2. Drilling assays at WOWO GAP to increase confidence

3. Some better drill results at RDS JV


Good luck

 

[prawn_86]

the drilling assays from wowo should be out within the next 4 weeks maximum, if the info i have is correct.

seems to be a bit of increased interest of late, but i would like to get a techies opinion if any of them read this thread please. looks to be in a long term up trend over the last year according to me.

this is a bottom drawer stock for me and i am happy to hold for a while until positive news, due to the massive difference highlighted in my previous post.

 

[prawn_86]

WOWO
jorc inferred 120mt @ 1.2% ni and 0.1% cobalt
assume ni price of USD$35000 per tonne
cobalt price of USD$95 per pound

120mt * .012 = 1.4m
1.4m * 35000 = USD$50billion
share on issue - 427542812 * sp of 6c = 25.6mill market cap

therefore, current market cap vs NPV of ni alone = <0.5% as all figures are in USD

just did some follow up and it should be $50billion, not 5 bill as i had there. this is a real potential company maker.

does anyone know much about the management team?

 

[prawn_86]

does anyone have any feedback/querys as to my analysis? aside from what YT has said

like i said, its a first for me so just looking to improve.

 

[WRONG'UN]

Hi Prawn 86
Thanks for your informative post.
( It might pay to check the cobalt price - the latest price at cobalt.bhpbilliton.com is $US27.20/lb cf your assumed $US95 - don't worry, this has no effect on your conclusions )
I maintain a spreadsheet of about fifty resource companies which calculates the ratio of the in-situ value of each company's resource to the market capitalization of the company. The ratios are then sorted in descending order. RMI's Wowo project has a ratio today of about 2500 ( ie. < 0.04% the other way, which ties in with your < 0.05% - yes, it is $50B ). This puts it at the top of my list, by a considerable margin, and miles above other explorers in the 25 to 100 range and producers which are typically less than 10. And then there are the Argyle and other projects.
My spreadsheet is not rocket science, and is nothing like the detailed stuff done in broker reports and indeed as presented by well informed contributers on this forum. However it does give a rough method of assessing relativity between various companies, and sometimes throws up a potential gem - RMI could be one of these, notwithstanding YT's genuine concerns. The results of the current drilling will therefore be very interesting.
From a technical perspective the attached weekly line chart ( close ) is looking promising - the price is above the 30 week wma ( ref Weinstein ) and looks poised to break a resistance zone between 6.3 and 7.0 ( may need some positive news on the drilling front ). The steady buildup in volume that has accompanied this year's rise is also good news.
An interesting observation is the fact that RMI has closed at its daily high only once since 10 May - time and again it has either opened at its high, or has been propelled to its high, only to fall back later in the day. Evidence that this persistent selling is ending could be an increase in the frequency of "close at the high" days - a sign of an imminent breakout?
( This is my first attempt to post a chart, so hope it works! )
I am not a financial advisor, so do your own research.

 

[Bushman]

'The Wowo Gap Project is located about 200km east of Port Moresby, and 35km from the villages of Safia, near the Musa River and Wanigela, situated on Collingwood Bay.' Anyone have any idea of the topography of this area? PNG is a rugged, mountainous country so it would be interesting to know where the deposit lies and how they intend to move it to a port. Any similar type laterite projects out there that can give some sort if capex indicator?

In terms of ann, I would really like to see the exploration licence renewed as a first step. Then obviously firming up the estimate (120 mt), feasos etc.

What is a given is that the resource, if proven, is a sh*tload of Ni.

 

[prawn_86]

'The Wowo Gap Project is located about 200km east of Port Moresby, and 35km from the villages of Safia, near the Musa River and Wanigela, situated on Collingwood Bay.' Anyone have any idea of the topography of this area? PNG is a rugged, mountainous country so it would be interesting to know where the deposit lies and how they intend to move it to a port. Any similar type laterite projects out there that can give some sort if capex indicator?

In terms of ann, I would really like to see the exploration licence renewed as a first step. Then obviously firming up the estimate (120 mt), feasos etc.

What is a given is that the resource, if proven, is a sh*tload of Ni.

not too sure about the topography, but one of the rumours i have heard is that they would be able to use a barge to get the ore/ni(is there a proper name for it?) down to the port, due to the proximity of the river.

apart from what i posted in my first post with regards to nickel laterite i couldnt find much more info, apart from the fact that it can be difficult, although a resource this size would be enough to cover the costs/get finance one would hope.

 

[WRONG'UN]

Yes, information about the topography is an issue for me.
The 2006 AGM presentation has aerial photos of the site which suggest a reasonably flat plateau area between mountainous terrain. If the sample GPR cross section is also from the site, it would provide some confirmation of this -at least the ground surface on that section is not on a 45 degree slope!
Can someone with Google Earth take a 3D look at the area if this is possible?
The GPR section itself looks impressive, with the different zones clearly identified. I can understand why the company is confident they can accurately quantify a resource with fewer drillholes than would otherwise be required in the absence of GPR.
There is now an April 2007 report by Patersons on the recently improved website. Some key points are:
Resource:
"RMI's objective is to define an indicated resource of over 200mt" ( the current inferred resource is 120mt )
Changes to PNG Mining Act:
"... no assurance can be given over renewal of any Exploration Licences in the PNG"
Land Ownership:
"... no assurance can be given that disruptions won't occur"

There is also the outlook for the nickel price itself - it has fallen over 30% from its recent high - where to from here?

 

[prawn_86]

nickel is currently at the same price as it was a year ago, im not too sure about the supply and demand side of things, anyone out there that is?

but in a bull commodity cycle one wouldnt think it can keep falling. even using half my calculations it still gives $17.5 billion which is still a significant number.

i have google earth but cannot find the longitude and latitudes on the co's website. have i missed it somewhere?

 

[prawn_86]

sorry to double post, but i just got an email from the company with regards to some questions i asked:

1 I'm wondering when your first round of drilling results from Wowo are likely to be announced.

2 Also what your companies current activities are and what's planned next?



Here's the response:

Drilling is slower than planned, the first holes have been completed but we are having problems getting the core out as all helicopters are occupied with the current election activity. (Politicians and Govt officials have priority on access to choppers). We expect that once the elections are over, we'll have more predictable access. We don't expect any assay results until closer to the end-of-the-month.

Our activities remain:

1. Wowo Gap exploration with the diamond drilling/GPR work

2. Argyle Iron Ore seeking a partner which is on-going with considerable interest

3. Monitoring the JV activity with Redstone Resources re Blackstone range Michael Hills exploration

http://http://www.radioaustralia.net.au/news/stories/s1968245.htm this link talks about helicopters in PNG and how they are used.

hope this all helps!

 

[WRONG'UN]

Well done checking out the programme for the drilling results - the end of the month is only three weeks away. The good news is that the holes are only about 20m deep, so they should cover a large area relatively quickly. And presumably a shallow deposit in itself is good - open cut mining.
I found the coordinates of Wowo on p2 of the company's announcement of 19July 2006. They are: 9 degrees 33 minutes South, 148 degrees 55 minutes East.
I agree with your comments on the Ni price. Two positives from the Kitco charts: a. a possible support level around the $US16/lb level. b. LME Ni stocks are still very low.
Cheers.

 

[YOUNG_TRADER]

Hey Prawn,

Pato's did a research report on it not too long ago, they like me are waiting for 1 of the following before they take a proper interest in the stock

1. A JV or clearer path for development appears at Argyle

2. Drilling assays at WOWO GAP to increase confidence

3. Some better drill results at RDS JV

Until then I don't expect it to move much,

Also I wouldn't expect WOWO assays to be reported for at least 4-6weeks (more likely 6 weeks) so there is still time to sit and wait

Some good research there though

 

[prawn_86]

Well done checking out the programme for the drilling results - the end of the month is only three weeks away. The good news is that the holes are only about 20m deep, so they should cover a large area relatively quickly. And presumably a shallow deposit in itself is good - open cut mining.
I found the coordinates of Wowo on p2 of the company's announcement of 19July 2006. They are: 9 degrees 33 minutes South, 148 degrees 55 minutes East.
I agree with your comments on the Ni price. Two positives from the Kitco charts: a. a possible support level around the $US16/lb level. b. LME Ni stocks are still very low.
Cheers.

i had a look on google earth, but there is not enough detail. all you can see is jungle pretty much. i dont think their satellites focus too much on PNG

 

[WRONG'UN]

Oh well, it was worth a try - thanks.
On reading the website more closely I see that the company describes the site as a "relatively flat plateau", pretty close to my "reasonably flat plateau" suggestion - so I think we can safely assume that the terrain at the site isn't too bad. Getting road access to the site ( elevation 700m ) is another matter of course.
This has been a really interesting thread - thanks to all contributors.

 

[skiper]

Going by todays action, i'd reckon they have got over the terrain issue and a lot of people are aware of this, lol