SDL - Sundance Resources

[springhill]

Springhill... see my last post on 24th February below.
I am happy to tell you my holdings. I am in the green on every single one of them.

Piggy... unlike some, i only check the boards every couple of weeks and i do not bag people. Carbon has been bagging me since my first post because i said SDL will be going to 7 cents which is exactly what happened. Since then, i have made over a 100% gain in FMG, steady with BRM (with very little risk) and have made trading profits on AGO as well. All the IO plays are going very well, only SDL going to all time lows as i predicted. If you only want to have posters that pump up the stock then fine, good luck to you.

I am just trying to tell new investors that all is not rosey with SDL and the chances of this stock going to Zero are huge.

24th February 2009..Carbon Steel and othe Bag Holders,

You can bag me all you like but the stock is down 30% (40% now) in the last couple of weeks. FMG up around 80% and BRM up over 10% from my first post.

CUS up over 30% as well as AGO. All of my stocks are up including CBA at 25,
BHP and RIO.

My first post, i said that you will be able to buy at 7 cents in a couple of weeks, but i suppose that i am the idiot????

You will see 7 by the end of the week, maybe tomorrow.

Carbon, if you try and compare SDL to BRM, you are just mad. BRM has 102 million dollars in cash, ZERO debt, existing rail network a few kms away and a new port facility. More than 1.3 billion tonnes of quality iron ore and a market cap of just 135 million.

SDL has a 400K piece of land, no rail, no port and hundreds of kms from the ocean. Not to mention Africia, no funding and no chance of funding. Stock at 8cents and only going lower.

If you think that this mine is going ahead, you need to pull your head out of your butttt. I would calculate that you have more chance winning the lotto.

I was just trying to warn you inexperienced investors about getting into this stock and holding the bag. See you at 7cents this week, maybe even .6.5cents. Good luck all!

Congratulations snoppy thats a fine effort, perhaps you'd consider starting your own blog on here, and we could learn from your efforts and reasoning behind them in a constructive manner instead of telling members to "pull your head out of your butttt"?

 

[snopandsnap]

Hey Carbon,

You wouldnt have $1000 to bet. I thought you said we would never see 7 cents just a few weeks ago and that SDL only traded up with the SJO.
Well, the market is up today including every single one of my stocks.
SDL down another 7%. Excellent pick mate.

Can you give me another one of your top picks so i can have a laugh.

Good luck and see you all again in another couple of weeks. SDL will be between 6 and 7 by then. As for your 2.5 billion revenue. Oh please.
How many other miners in W.A. have 1 billion tonnes of IO just sitting in the ground.

Brockman have 1.6 billion so far just a few kms from existing train lines.
Market cap of 130 million with 100 million CASH. That means the market value for them minus cash is 30 million.
You are taking about raising 3 to 5 BILLION for land 480 km from a port and rail that does not even exist. Never mind that the land borders three African nations. Please, please, you are honestly dreaming dude.

P.S. i have typos because i type around 80 wpm and english is not my first language.

 

[hangseng]

no funding and no chance of funding

Really????

Care to share how you know that? I would truly like to hear why the certainty in your statement.

 

[Joe Blow]

Just a reminder to all that statements like "you need to pull your head out of your butt" are really not appropriate. Feel free to disagree with others, but please try and do it without being imflammatory or insulting.

Also, I want to be clear that I have no problem with bullish or bearish views as long as you are prepared to support your argument with some facts and figures. This supporting material is what separates a genuine bullish or bearish view from a ramp or downramp.

 

[CarbonSteel]

Hey Carbon,

You wouldnt have $1000 to bet. I thought you said we would never see 7 cents just a few weeks ago and that SDL only traded up with the SJO.
Well, the market is up today including every single one of my stocks.
SDL down another 7%. Excellent pick mate.

Can you give me another one of your top picks so i can have a laugh.

Good luck and see you all again in another couple of weeks. SDL will be between 6 and 7 by then. As for your 2.5 billion revenue. Oh please.
How many other miners in W.A. have 1 billion tonnes of IO just sitting in the ground.

P.S. i have typos because i type around 80 wpm and english is not my first language.

...and respect and courtesy are not your first considerations.

Hey Snoppo, can you direct me to the post in which I allegedly claimed that SDL would never be at 7 cents. I've looked and looked and looked, my friend, and for the life of me, I cannot find it.

Actually I do have plenty of money to bet, but alas, I note that you refuse to accept any wager to back your own claims. No guts, I guess!

As an aside, I am down 13.09% on SDL, having bought at a dollar cost average of $0.085 between December and the present. The lowest price at which I bought was $0.073 on 15/12/08.

What made you assert that I was 80% down?

I must confess that I am very impressed by your ability to type 80 wpm, it's quite an achievement for you obviously, because you feel the need to tell people who have absolutely no interest whatsoever.

At the end of the day, these are rhetorical questions and comments that I do not need a response to. The truth is that I have really tired of your attitude and you are no fun anymore.

I cannot bring myself to trust your investment advice, because I seriously doubt that you are as wealthy as Ken Talbot who has made many good investment decisions, the most recent (and quite sizeable) endorsement of SDL at a time when you are advising that SDL will suffer a slow death.

До свидания, идиот.

Can you give us some more examples of not bagging people, besides these ones.....and the opening quote above....

If you think that this mine is going ahead, you need to pull your head out of your butttt. I would calculate that you have more chance winning the lotto.

I was just trying to warn you inexperienced investors about getting into this stock and holding the bag.

I also don't understand why you come to our forum, if you don't hold SDL and bag it constantly without fail.

Maybe you would be happier somewhere else, I know I would be happier if you were somewhere else! I don't need to continuously scroll past your rubbish to read what SUPPORTERS are saying.

 

[CarbonSteel]

China has offered Rio Tinto an unlimited line of credit, potentially worth more than $30 billion, to develop major mining projects in Australia, China and around the world.

The Weekend Australian says the offer from the state-owned Export-Import Bank of China, or Exim Bank, will help Rio Tinto expand at a time when frozen debt and capital markets have starved the mining industry of funds.

But the paper says the proposed loans would add another layer of complexity to the federal government's deliberations over state-owned Chinalco's $US19.5 billion ($A29.79 billion) investment in Rio Tinto, Australia's second-biggest miner behind BHP Billiton. The Exim offer is tied to the success of the Chinalco deal.

The undertaking from Exim was delivered to Rio Tinto on February 12, the same day the miner inked its deal to sell Chinalco $US12.3 billion ($A18.79 billion) worth of stakes in key assets and $US7.2 billion ($A11 billion) of convertible bonds.

Rio Tinto, which last year rejected a $US135 billion ($A206.26 billion) takeover bid from BHP Billiton, turned to Chinalco after rejecting other options to reduce the $US38 billion ($A58.06 billion) debt pile left over from its much-criticised acquisition of Alcan.

The company is lobbying shareholders and the federal government on the merits of the deal - the biggest foreign investment by a Chinese company and the biggest by any foreign company in Australia.

Source: The Sydney Morning Herald - 14/03/09

What do you think, fellow SDL holders? Implications for our pick?:bier:?

From the Half Yearly Report...

A Framework Agreement was executed between Cam Iron SA, represented by the Chairman of Sundance, and the Government of Cameroon, represented by the Prime Minister on 18 December 2008.

.......Mbalam Convention to be executed when the Project feasibility study has been completed.

As I understand it, the Feasibility Study completion is a precursor to the Mbalam Convention, after which the Cameroon Govt. will buy its' stake in the project. I cannot see a schedule for the completion of the Feasibility Study, but in any case, it must be completed, the Mbalam Convention ratified and then the purchase will be effected.

Bottom line... it is a while away.:nosympath

 

[CarbonSteel]

We have had a SDL poster (praise be to the wisest one:bowdown telling us that African projects have a huge risk of failure and that mining companies must be "in the back pocket of the government". Apparently, Rio Tinto, (the worlds third largest mining company) unaware that such good advice is freely available right here in this forum, has not heeded the advice of this poster....

dated Feb 13/09......

http://www.reuters.com/article/innovationNewsIndustryMaterialsAndUtilities/idUSTRE51C5GY20090213

 

[Sean K]

Apparently, Rio Tinto, (the worlds third largest mining company) unaware that such good advice is freely available right here in this forum, has not heeded the advice of this poster....

dated Feb 13/09......

http://www.reuters.com/article/innovationNewsIndustryMaterialsAndUtilities/idUSTRE51C5GY20090213

Well, depends which part of the article you want to read really.

In December, Rio Tinto said it would slow the pace of production at its La Granja copper project in Peru. The company aslo said earlier this year that it had all but halted its expansion of the Kitimat aluminum smelter in British Columbia.

After further cuts, Rio Tinto announced on January 20 that it would shed 1,100 jobs, cut a further six percent of aluminum output and scale back alumina production.

Rio and Cameroon's government each own 46.7 percent of Alucam, their joint venture. The remaining 6.6 percent is controlled by other shareholders.

A statement issued by Alucam said the geo-technical studies had been completed but an environmental assessment remained. A final decision on whether the project will go ahead will be taken by the end of the year, it said.

Already the world's fifth largest cocoa producer, Cameroon is targeting mining investments in the region of $10 billion over the next few years. The central African nation pumped 30 million barrels of oil last year but reserves are tailing off.

Cameroon has had to cut its 2009 growth forecast to 4 percent, down from 6-6.5 percent, largely due to the financial crisis and plummeting prices for its oil and metals exports.

Not sure what the Cameroon numbers really mean. Is it still growing on target?

Doesn't read all that bright and shiny for developing projects to me.

Major slow down globally. Hope SDL's remains on track for you.

 

[jman2007]

We have had a SDL poster (praise be to the wisest one:bowdown telling us that African projects have a huge risk of failure and that mining companies must be "in the back pocket of the government". Apparently, Rio Tinto, (the worlds third largest mining company) unaware that such good advice is freely available right here in this forum, has not heeded the advice of this poster....

dated Feb 13/09......

http://www.reuters.com/article/innovationNewsIndustryMaterialsAndUtilities/idUSTRE51C5GY20090213

While I do appreciate your enthusiasm Carbon, perhaps we should try to compare apples with apples here.

Don't underestimate the power of the big 'super-miners' to bully and cajole their way into getting their own way, and dare I say it, to pay off the right people. I'm certainly no expert in the intricacies of Cameroon Mining law and legislation - but certainly there is an element of country risk here.

SDL in comparison, is just a little cork riding the waves and being carried along by the current. On the other hand, you would think that the Cameroon Govt would be more open to developing the project given the somewhat dire economic figures quoted.

jman

 

[The Muffin Man]

I'm not sure that cutting the Cameroon growth rate to 4% from 6% is a 'somewhat dire' economic statistic when you take into consideration the current economic climate around the World. A 4% growth rate is still quite encouraging I would have thought. Any project that can contribute a gross 8% of GDP towards a country would surely be at the top of the list to support as far as developments go.

I personally believe that the main risk for SDL now has become cash reserves. The share announcement last week has helped alleviate those pressures, but for how long I'm unsure. I'm trying to read into the situation based somewhat on how large (or in fact small) the share placement was.

Consider that the placement will raise $10m. In recent past, SDL has gone through around $10m-$12m per quarter, but that is expected to come down due to drilling and exploration at Mbalam being finished. From memory, SDL had $19m in cash at 31 December 2008. What I'm reading into the share offer is that it is a solution to possibly fill a cash shortfall in the short term. The $10m raised could sustain the business for probably a quarter, maybe a little longer. If the SDL board believed that more money would be needed beyond the $10m (or in other words, 3 to 4 months of operations) surely they would have made the share offer larger?

What I'm hoping is that this share issue is a safeguard to make sure there are enough cash reserves while SDL works on all of the necessary agreements with the Cameroon Government, which upon their completion the Cameroon Government will buy into the project further (and thus inject further cash into the company)

It's hard to try and analysis this when you have to make so many assumptions, or apply your thinking to what's happening and the possible reasons behind it, but they are my thoughts. Anyone else have a take?

I'm still extremely confident in the basis of the project, given all of the facts that have been listed in the thread before. For me, the major issue is ensuring SDL has the cash reserves in hand to continue operating until the Cameroon Government makes it's decision on buying further into the Mbalam project. Raising just $10m signifies to me that SDL is confident this will happen in the not too distant future, or else they would have tried to make the share offer larger.

 

[big sal]

Raising just $10m signifies to me that SDL is confident this will happen in the not too distant future, or else they would have tried to make the share offer larger.

Agree on the amount being raised and the reasons for it. suggests they need a little longer with contract discussions etc before making an announcement to the market.

 

[jman2007]

I'm not sure that cutting the Cameroon growth rate to 4% from 6% is a 'somewhat dire' economic statistic when you take into consideration the current economic climate around the World. A 4% growth rate is still quite encouraging I would have thought. Any project that can contribute a gross 8% of GDP towards a country would surely be at the top of the list to support as far as developments go.

Mmmm yes, point taken

If the figures can be trusted, 4% growth shouldn't be sneezed at, and any entity that could potentially contribute 8% to a country's GDP is pretty mind blowing. Me thinks this is still definitely one to go long on.

jman

 

[CarbonSteel]

Well, depends which part of the article you want to read really.
Not sure what the Cameroon numbers really mean. Is it still growing on target?

Doesn't read all that bright and shiny for developing projects to me.

Major slow down globally. Hope SDL's remains on track for you.

Greetings kennas,

The point I was trying to make is that companies are already mining, proposing expansion and investment, and adding value in this African country, so it is not beyond the realms of imagination that SDL's project could ultimately follow suit. (The poster I referred to made it sound as though this is a hugely unlikely outcome for SDL - I do not agree with that view) Not only is it a very real possibility, but it must be a very attractive proposition for the Cameroon Government. Why would they ruin an opportunity to have a new venturer provide 8% of their GDP?

While the projected income was scoffed at by the same poster, he failed to provide an insight into what was wrong with the figures. (35 Mtpa x $US44pt = $US1.54Bpa) or the example based on SDL's claims for initial production (50.Mtpa x $US44pt = $US2.22Bpa). I would have thought that even a $3-4B CAPEX becomes relatively insignificant to a producer who wants a long term supply (> 20 yrs) of quality product, (at a guaranteed price) which they can ensure for themselves by getting involved in offtake/finance agreements now. This GFC will end one day I'm sure.

Possibly it has no meaning whatsoever, but it is difficult for me to believe that an "insider" like Ken Talbot, would throw good money after bad. He is probably better informed than most of us and has made a decision to increase his stake and exposure. Why would he do that?

 

[prawn_86]

Possibly it has no meaning whatsoever, but it is difficult for me to believe that an "insider" like Ken Talbot, would throw good money after bad. He is probably better informed than most of us and has made a decision to increase his stake and exposure. Why would he do that?

People said the same about Micheal Keirnan, and look how well that went for them...

Point is, even rich people within the industry can make mistakes.

In fact Talbot was one of the Rich200 who lost the most recently due to his exposure to speccies....

 

[The Muffin Man]

If you look at the June 2008 Financial Report, you can see under the Non Current Assets section of the Balance Sheet the line item 'Exploration and Evaluation Assets' with a balance of around $64.37m.

From what I can gather, Sundance is capitalising their exploration and evaluation costs into this asset account. If you follow down to the corresponding note (note 14), it breaks up this $64.37m balance into the Mbalam Iron Ore Project and the Congo Iron Ore Project. Mbalam currently holds $64.27m of that balance.

Now, you need to add on exploration and evaluation costs for the last two quarters, but remembering that there has been further exploration of the Congo site in this period also.

The September quarter showed exploration and evaluation of $12.36m, let's say that $9m of that was spent on Mbalam to be on the conservative side.

The December quarter showed exploration and evaluation of $9.9m, let's say $6m of that was spent on Mbalam to be on the conservative side.

So we have the initial $64.27m held in the asset account that has been capitalised, and $15m from the first half of operations so far this year, which totals $79.27m. This is just a rough estimate and includes no other expenses that have not been capitalised during the time Mbalam has been developed.

It depends on how the company has accounted for items like consulting fees for instance. Consulting fees appear in the June 2008 Financial Report in the Income Statement. If these consulting fees were to do with Mbalam should they also be added to the end sale figure to the Cameroon Government? That's what I mean by there being some grey areas where only the company and Cameroon Government will know the real figure.

Feel free to pick this apart but I'm pretty confident that the Exploration and Evaluation Non Current Asset will be a very good starting point in figuring out how much has been spent developing the Mbalam site, then you need to add on this years current expenses.

After sitting down and going through the report, we can see that the Mbalam Exploration and Evaluation Assets Account held $97m in it at December 31. My estimate was a little way off, but the variance is in SDL's favour. I'm interested to know if this account is what will be used to determine what the Cameroon Government will pay for the extra 15% of CamIron.

I can understand that there are still quite a few things that could derail the Mbalam Convention, but there are encouraging signs. Why would the Cameroon Government nominate CamIron as the preferred developer of the Iron Ore section of it's multi billion dollar Kribi Port development if the Government had drastic concerns about the detail of the Convention?

Under the Potential Strategic Partners heading is some information I think we all knew. The Global Financial Crisis is effecting the process of introducing strategic partners to the process. The capital raising recently announced will ensure that SDL has the operating funds to see it through to 2010, which is an assuring statement. Hopefully by this stage, or earlier, there has been some improvement in World economic conditions.

I have a feeling SDL may be a little quite for a few months. Would the Cameroon Government sign the Mbalam Convention and buy into the project further before SDL can secure strategic partners / off-take agreements? I'm not so sure. Hopefully the company is being nice and tight with cash reserves so it doesn't experience any financial pressures in the near future.

 

[CarbonSteel]

People said the same about Micheal Keirnan, and look how well that went for them...

Point is, even rich people within the industry can make mistakes.

In fact Talbot was one of the Rich200 who lost the most recently due to his exposure to speccies....

But how did they get to be rich people in the first place? Warren Buffet is also hurting. Is he now not worth following? Is his advice now worthless? You only lose money if you sell, although your net worth can be trimmed by stock declines. Did Talbot sell?

My point is that at a time when everybody is being very cautious and selective about their investments, Talbot (an SDL insider) has decided that SDL shares are a good investment at 8 cents.

 

[Sean K]

You only lose money if you sell,

Not necessarily. I've had two companies that were very undervalued by the market, which I had a lot of faith in, and had some great investors and large banks on the register, that went belly up. My return? Nada. A nice capital loss was my return. There's been a few of those recently actually.

 

[Pythagerous]

Anyone know anything about African Aura Resources Ltd increasing its targets on the Nkout Iron Ore prospect?

I read that it is strategically positioned 150kms south of the Mbalam Project.

Do people see this as a good thing, as it will help with getting costs and demand for a rail and a port? Or is it a bad thing, as it is going to increase competition and potential investors could be taken away from SDL?

 

[CarbonSteel]

Not necessarily. I've had two companies that were very undervalued by the market, which I had a lot of faith in, and had some great investors and large banks on the register, that went belly up. My return? Nada. A nice capital loss was my return. There's been a few of those recently actually.

HMMMMM!!!

Point taken kennas

You think Talbot is a possible Pied Piper of Financial Death then?

 

[hangseng]

You think Talbot is a possible Pied Piper of Financial Death then?

Maybe that is why he has just chosen to pump another AUD$5M into SDL. Or maybe he just threw it all on black at the casino.

I really don't think so at all. He knows far more about this project than any of us her. He has done this because he knows what is going on, what will occur and has placed (further) funds to what he believes is an excellent investment.

Either that or he is a complete dill, again I really do not think that is the case.