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RWD - Reward Minerals

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exberliner1

exberliner1

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RWD is starting to look good imo.....they came out with a great JORC ANN last week concerning the potash reserves they own.

There is only about 44 million shares and the JORC has an in situ value of something ridiculous like $100+ per share. Potash has a retail of about $630 per tonne.

The JORC ANN of last week offered up the following:

24mn - 27mn tonnes of the stuff

There are no other potash producers in Australia as far as I am aware.

Recently BHP had expressed an interest in potash and has started an expensive mining project in Canada.

RWD's potash lies at surface in what are basically huge evaporation pools.

In addition RWD has some good looking gold prospects as well.

The price has been creeping up all week closing at 84c...it was interesting to note a buyer getting filled at 80c for 150k on Friday ....this just about cleared out the sell depth.

RWDO have a strike of 20c and mature in June 09.

Even taking half price for the RWD potash to take into account cap ex for the first year or so of operation we still get

25mn tonnes (approx) potash @ $315 = $7,875,000,000

So undiluted that's : $178 per share
and diluted : $135 per share

Current price 84c

It's gotta be worth a lot more than 84c

So with 44mn shares and only 14mn oppies available I do expect this one to fly to very soon - you have been warned.

EB
 
Re: RWD

exberliner1 said:
RWD is starting to look good imo.....they came out with a great JORC ANN last week concerning the potash reserves they own.

There is only about 44 million shares and the JORC has an in situ value of something ridiculous like $100+ per share. Potash has a retail of about $630 per tonne.

The JORC ANN of last week offered up the following:

24mn - 27mn tonnes of the stuff

There are no other potash producers in Australia as far as I am aware.

Recently BHP had expressed an interest in potash and has started an expensive mining project in Canada.

RWD's potash lies at surface in what are basically huge evaporation pools.

In addition RWD has some good looking gold prospects as well.

The price has been creeping up all week closing at 84c...it was interesting to note a buyer getting filled at 80c for 150k on Friday ....this just about cleared out the sell depth.

RWDO have a strike of 20c and mature in June 09.

Even taking half price for the RWD potash to take into account cap ex for the first year or so of operation we still get

25mn tonnes (approx) potash @ $315 = $7,875,000,000

So undiluted that's : $178 per share
and diluted : $135 per share

Current price 84c

It's gotta be worth a lot more than 84c

So with 44mn shares and only 14mn oppies available I do expect this one to fly to very soon - you have been warned.

EB
Click to expand...

What is potash used for? also looks liek it already spiked! you should have mentioned RWD before the spike!

thx

MS
 
Re: RWD

Potash (or carbonate of potash) is an impure form of potassium carbonate (K2CO3) mixed with other potassium salts.

Potash has been used since antiquity in the manufacture of glass and soap and as a fertilizer. The name comes from the English words pot and ash, referring to its discovery in the water-soluble fraction of wood ash.

Most of the staff is produced in Northern America.
 
Re: RWD

potash used in fertilizer......and I would argue that this is not a spike....merely the beginning of a huge rerating...

Just keep it on the watchlist....

EB
 
Re: RWD

exberliner1 said:
potash used in fertilizer......and I would argue that this is not a spike....merely the beginning of a huge rerating...

Just keep it on the watchlist....

and diluted : $135 per share

EB
Click to expand...

Is that a diluted share price of one hundred and thirty five dollars or one dollar and thirty five cents.?

:confused:
 
$135 per share....

$7,875,000,000 / 58,000,000 shares (44mn RWD + 14mn RWDO)

= $135

And that's taking potash at half price $315 per tonne instead of $630 per tonne.

See what I mean about upside

EB
 
exberliner1 said:
$135 per share....

$7,875,000,000 / 58,000,000 shares (44mn RWD + 14mn RWDO)

= $135

And that's taking potash at half price $315 per tonne instead of $630 per tonne.

See what I mean about upside

EB
Click to expand...

Interesting. Do you know when they are planning on generating cash from this project?
 
Do you also know how many years that the production would go for? You have calculated the in ground total value by the looks of things but I don't think that thats the way to work out a share price is it?
 
No it's not the way to calculate NPV on a share price champ....but it does give an indication of value going forward...

Even valuing the SP based on 2% of in situ would give us $2.70 on the fully diluted...or at 5% we get $6.75....

It is early days yet RWD has just caluculated the JORC resource....but with BHP looking to spend $1.5bn on a deep potash mine is Canada then RWD might look very attractive to them. The RWD resource sits at (or near) surface and can be recovered using simple solar evaporation.

No expensive mines needed for RWD.

I am just bringing it to people's attention here on ASF....you use your own methodology to work out where the SP should be.....I think like me you will come up with a number that is a lot bigger than the 84c it closed at on friday.

EB
 
Nice to see some early morning buy orders in RWD this morning....recently this stock has been flying below the radar.

Keep an eye on RWDO....when the heads move you can often benefit from a short term arbitrage opportunity.

Still a few left at 85c.....after that we are up around $1

Based upon last week's action and the JORC ANN issued by RWD last week I would not be suprised to see RWD undergo a bit of a rerating during the first half of this week.

Good luck

:)

EB
 
Hi Exberliner,

Do you have a website that I can check out which states what the going price is for potash per tonne?


Champ
 
sorry Champ.....I don't....

Article from The Age...

A few days old......but still nice to see BHP and Reward Minerals discussed in the same breath....wishful thinking perhaps....

____

"RISING living standards in the boom economies of China and India not only gets translated into higher prices for base metals.

It also gets translated into increased food consumption, which, by extension, means that agriculture needs to become more intensive through the increased use of fertilisers.

That's why BHP Billiton, of all companies, recently flagged its interest in looking for a world-class potash deposit in Canada.

Potash is the common term for fertiliser forms of the element potassium (K). While it is common (seventh) in the earth's crust, finding a commercially payable deposit is something else.

As BHP begins its Canadian hunt, a little-known Perth explorer, Reward Minerals, is well down the path. That was reflected in the group's share price more than doubling in the past two weeks, from 41 ¢ to Friday's 84 ¢ a share.

The reason for the surge was simple enough ”” the company reckons that its Lake Disappointment potash deposit could contain as much as 27.37 million tonnes of sulphate of potash (SOP).

SOP is a major source of potash in fertilisers and at present sells for $632 a tonne, which means that Lake Disappointment might be anything but a disappointment.

Australia alone imports $200 million of SOP at the retail level.

____

The article quotes 27.37mn tonnes at $632 per tonne....the problem here is that most calculators do not have enough digits in the display to work that one out.....so according to The Age - makes Reward's JORC worth $17,297,840,000 or $288.30 per share fully diluted share or $393.13 per share undiluted...in situ of course.....but that is in situ at / or near surface and in Australia...

So valuing RWD at 5% of an in situ JORC.....well you work it out...

EB
 
exberliner1 said:
sorry Champ.....I don't....

Article from The Age...

A few days old......but still nice to see BHP and Reward Minerals discussed in the same breath....wishful thinking perhaps....

____

"RISING living standards in the boom economies of China and India not only gets translated into higher prices for base metals.

It also gets translated into increased food consumption, which, by extension, means that agriculture needs to become more intensive through the increased use of fertilisers.

That's why BHP Billiton, of all companies, recently flagged its interest in looking for a world-class potash deposit in Canada.

Potash is the common term for fertiliser forms of the element potassium (K). While it is common (seventh) in the earth's crust, finding a commercially payable deposit is something else.

As BHP begins its Canadian hunt, a little-known Perth explorer, Reward Minerals, is well down the path. That was reflected in the group's share price more than doubling in the past two weeks, from 41 ¢ to Friday's 84 ¢ a share.

The reason for the surge was simple enough ”” the company reckons that its Lake Disappointment potash deposit could contain as much as 27.37 million tonnes of sulphate of potash (SOP).

SOP is a major source of potash in fertilisers and at present sells for $632 a tonne, which means that Lake Disappointment might be anything but a disappointment.

Australia alone imports $200 million of SOP at the retail level.

____

The article quotes 27.37mn tonnes at $632 per tonne....the problem here is that most calculators do not have enough digits in the display to work that one out.....so according to The Age - makes Reward's JORC worth $17,297,840,000 or $288.30 per share fully diluted share or $393.13 per share undiluted...in situ of course.....but that is in situ at / or near surface and in Australia...

So valuing RWD at 5% of an in situ JORC.....well you work it out...

EB
Click to expand...

Thanks for that exberliner.

Something for me to mull over i think.
 
Yea, I bought some at 55c.

The potential is huge and so is the risk. The location is in the middle of the desert, how do they get the stuff out? Is the quality high enough? The company are probably looking at a partnership with a larger company.
I'm happy to wait and see what unfolds.
 
Apparently the quality is of an excellent nature and very similar to the quality of SOP in the states so that doesn't seem to be an issue. I imagine that they could just Truck the stuff out so shouldn't be any problems there either. I've chatted to the exploration manager and he recons that they should be able to go into production within 2 years. Give them a call if you like. They are good to talk to.

They don't seem to be looking for a partner for their Potash project however i think they will need a partenr for their base metals project. They seem set on holding on to that Potash project fairly tightly but we'll just have to wait and see what pans out. Either way I don't see much downside with this company with the JORC already announced for their Potash mine as that alone underpins the shareprice and they have plenty of cash in the bank to keep the projects going. I'm not focussed on any of their other projects however they should all be the icing on the cake.
 
RWD looks like its coming up with the goods folks and looks set for a substantial re- rating in the coming months due to their fast progression of their Potash projects and a stream of further upcoming drilling for more Potash in other locations that have potential to host world class billion dollar projects.

I'm personally looking forward to seeing what unfolds in the very near future.

Cheers!

Champ
:)
 
RWD has big plans for future potash resource. Experiencing a significant re-rating on the back of the fertiliser MAK boom. Potential numbers are also on a MAK scale .. you can read posts above for details:D
 

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Indeed.

I got badly burnt this morning as I'm sure I was the only idiot who bought at 1.205:banghead:

I wanted to to be a short term trade but instead copped yet another loss:(
Now that i look at the chart I really dont know what i was thinking by buying in today. Its had such a good run it was almost certain to have a day like today.
 
I came across an article on potash last month (http://www.dailywealth.com/archive/2008/feb/2008_feb_07.asp) which led me to Reward Minerals on the asx, managed to buy in a bit below $0.60, not sure whether to hold or sell.. My first stock purchase - greed has got the better of me already.

http://www.resourceinvestor.com/pebble.asp?relid=40460 (13th Feb '08) quotes the following regarding potash companies:
'Despite handsome runs across the board, recent retracements are a buying opportunity and going forward, most retracements will be buying opportunities in the context of the greater potash bull and its certain longevity in light of supply and demand realities. As the story really gets out there, the most levered players could deliver spectacular returns.'

I read that the native title decision will be made this month re: access to Lake Dissapointment, so I guess no doubt that'll influence the price for RWD. Wait and see..
 
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