SDL - Sundance Resources

[CarbonSteel]

Announcement released today, $15m has been raised (assuming the placement to Talbot Group gains shareholder approval which I'm sure it will)

What are everyone's thoughts on the SPP response and the overall amount raised? Those commenting within the announcement seemed pleased by the level of response. I would like to see what SDL's cash position is now, but if I'm correct, a March Quarterly cash flow report was never released so it would be impossible to ascertain at this point. In any event, they should have enough to see out the year, considering they have ceased drilling at Mbalam having already identified their target resource level.

The Chairmans Address dated 29 April 2009 actually does address the issues you raise....

http://www.asx.com.au/asx/statistics/announcements.do?by=asxCode&asxCode=sdl&timeframe=D&period=W

or direct download here...

http://www.asx.com.au/asxpdf/20090429/pdf/31h9jy56vrx26s.pdf

Also there is a presentation given in Beijing (22 pages) released today, with some minor new info and also available on ASX website or direct download here...

http://www.asx.com.au/asxpdf/20090429/pdf/31h9lqmddyn81d.pdf

Hope it helps

 

[The Muffin Man]

Yes, those documents were released after my post.

It doesn't state what cash the company holds but does state it will get them through into 2010 which is nice to know. SDL can now continue to impress the significance of this resource on potential partners. I wouldn't mind knowing when the Cameroon Government is officially going to tip their hat into the ring and come up with the 50% of development costs for their increased stake in CamIron. I get the feeling they are going to sit it out until SDL can secure partners. You would think that once a partner is found, the Cameroon Government will jump in and commit.

The timeline in the presentation is interesting (possibly a little optimistic too!). Neither the negotiations with partners nor the Mbalam Convention go past 2009 and into 2010. The update of the Feasibility Study and construction costs will be interesting, it will be good to see how far the CAPEX has reduced since the initial estimates were made sometime ago. Any information that will bring down the CAPEX of the project will make it look that much more attractive to potential investors. I just hope there are a few companies out there willing to look past the current sentiment and see what will be a great investment.

 

[CarbonSteel]

From the Quarterly Activities Report released today....

1. Continue to focus on discussions with interested parties.

2. Discussions to take place in June with the Government to progress the Mbalam Convention.

3. Got a cool $25Mil in cash.

4. Posssible pellet plant to add value. (4 Mt/a)

It's getting a little more positive. :alcohol:

Any good news I've missed?

Oh yeah...hit 10.5c again today

 

[big sal]

this isn't normal - has hit 11c on 79M volume and buyers now 36M vs sellers 15M units! and might just hit 11.5c ...

 

[The Muffin Man]

The movement is a little weird, I've given up trying to determine why the prices move the way they do and at what volumes!

I can't see any new news within the announcements over the last few days that would warrant an 80m share volume and a 18% price increase. I'm thinking the price will get traded back down to aroung 9c over the next 3-5 trading days as per usual

 

[CarbonSteel]

Any good news I've missed?

Oh yeah...hit 10.5c again today

Wow! Make that 11.5 cents!

(These 0.5 cent rises make it reaaalllyyyy worth while!)

Where's good old :bowdown:snopandsnap when you need him?:

 

[big sal]

i'm not sure how to check when SDL last had volume of 86.5M units in the one day but it's big! what % of total number of shares on issue is that?

there may just be some momentum there now to carry it forward again tomorrow and if the DOW stays in the green. overly optimistic to bet it can crack through the sellers in the 11.5-13c range, but with buyers 33M units v sellers 15.8M units at close, you never know, especially if quick profit takers from today's rise stay away.

 

[jonojpsg]

i'm not sure how to check when SDL last had volume of 86.5M units in the one day but it's big! what % of total number of shares on issue is that?

there may just be some momentum there now to carry it forward again tomorrow and if the DOW stays in the green. overly optimistic to bet it can crack through the sellers in the 11.5-13c range, but with buyers 33M units v sellers 15.8M units at close, you never know, especially if quick profit takers from today's rise stay away.

From memory it occurs fairly regularly (1/couple of months) bigsal. I think the week before last saw 150m-ish with a move up of about 1c? SDL have about 1.8bn shares on issue so 86m is about 5% of that.

 

[Pythagerous]

I think that this sudden jump in the share price of SDL is quite easy to explain. There has been a lot of hype of the last couple of days about SDL, with the meeting and several announcements / documents made. This has resulted in a number of news articles bringing attention to SDL.

I would say that the traders have also used this as an oppurtunity to try and rally the share price.

There are going to be a number of shareholders that recieve 62,500 shares, which they purchased at 8c in the SPP. As soon as they have access to these shares, I am tipping there will be somewhat of a sell off, as some will see the oppurtunity to lock in a $1250+ profit if they can sell it for 10c and above.

 

[fureien]

I think that this sudden jump in the share price of SDL is quite easy to explain. There has been a lot of hype of the last couple of days about SDL, with the meeting and several announcements / documents made. This has resulted in a number of news articles bringing attention to SDL.

I would say that the traders have also used this as an oppurtunity to try and rally the share price.

There are going to be a number of shareholders that recieve 62,500 shares, which they purchased at 8c in the SPP. As soon as they have access to these shares, I am tipping there will be somewhat of a sell off, as some will see the oppurtunity to lock in a $1250+ profit if they can sell it for 10c and above.

would you know roughly when that would be?

i was holding shares in sdl, but i had a non expiring limit sell order at 0.098 yesterday which i totally forgot about (i bought at 0.09 was trying to sell within the support and resistance ranges) because of the previous weeks drop in share price (i bought it just as the share issue at 0.08 was being hyped up, so i guess eveyrone was trying to consolidate it down to 0.08) i didnt think it would break the resistance. but waddya noe it broke it and i missed out on like an extra 15% profit or something lol. damn! didnt even get a chance to blink.

but if your saying they havent recieved the shares yet (i thought that "completion of capital raisin" would mean eveyrone got their shares already?)
im gunna see another drop? cause i made a bid today at 0.01 cents cause volume seems good -_-

 

[CarbonSteel]

There are going to be a number of shareholders that recieve 62,500 shares, which they purchased at 8c in the SPP. As soon as they have access to these shares, I am tipping there will be somewhat of a sell off, as some will see the oppurtunity to lock in a $1250+ profit if they can sell it for 10c and above.

This may well be the case for some investors....however, there is at least one other option.

I personally will not be selling the shares that I just bought for 8 cents. I sold at 10 cents and then bought these shares at 8 cents, so I already have my profit in free shares. There is the possibility that I will profit by a lot more than 2 cents if I use time as a tool.

I think that there are some good reasons not to be a seller right now. (I could not forgive myself if I sold now to take a 2 cent profit and was then staring down the barrel of say, for example, 30 cents three months hence.)

1. The focus on discussions with Strategic Partners sounds like it is intensifying during the June Quarter. From the Quarterly Report...

These companies include some of the world's largest iron ore and steel industry groups. Site inspections have been completed by a number of parties with follow up technical and commercial evaluation.

It is therefore possible that there will be an announcement regarding the outcome of these talks at the end of July. Indeed, I understand that George Jones was quoted as saying he was "confident" or "very hopeful" that this would be the case.

2. Discussions are to take place in June Quarter with the Government to progress the Mbalam Convention. This is a pre-requisite to the Cam Government tipping in its' share of loot for its' share of equities. So, if there is an announcement regarding securing a Strategic Partner at the end of July, I suppose it's just possible that the Mbalam Convention could be ratified contemperaneously. (Don't ya love it when a plan comes together?)

3. I figure that Ken Talbots' dollar cost average is more than 45 cents/share, after forking out another $5M. I don't think this man is stupid and will have more information about the future of this company than me. No man is infallible, but I have a gut feeling that this guy, knowing this market, knows exactly what he is doing.

4. There are other plusses, including a possible pellet plant to add value; an increase in high grade DSO; the recent sale of a "comparable in-ground ore resource" in South America for $US1/t, and the very recent incredible opportunity for exposure, through the INDABA Seminar in Beijing, to the worlds' biggest user of IO.

I feel that the whole project is now a lot more credible and has more credibilty with the folks who will quite possibly be screaming for IO in 18 months time.

I feel that the prediction by a detractor that we would be seeing a price of 5.5 cents in June now has a very remote chance of being correct.

 

[fureien]

you just made me feel alot better lol *holds onto new stocks tightly*

30 cents? i like the sound of threefold ur money

 

[Jewels]

I was at the recent SDL Meeting and thought I'd give you guys a bit of a run down.
Firstly as announced the SPP was successful, so the only motion that required moving for the whole meeting was re Ken Talbot picking up his $5 million worth. Was this all a ploy for KT to increase his shareholding legally? Good question, I'm glad you asked. If so why would somebody kick in $5 million dollars into a 2 bit company with no hope of financing? Once again, I'm glad you asked.
Not to many people there, about 60 or so (just a guess).
After the chairmans address the whole meeting only took 5 minutes before it was closed. Then came the interesting bits, question time:
For those of you who know me you'll know that I'm likely to ask the questions that the board don't like to answer.
My first question was basically pipeline Vs railway. I was surprised that in a recent article in the AFR that GJ was still courting the idea of a slurry pipeline, espescially considering the proximity of Mbalam t Auora Resources and the many other surrounding tennements.
Basically GJ said that the advantage of a pipeline was a considerably reduced CAPEX and OPEX, when compared to a rail line. His theory was that SDL could start with a pipe to get cash flow up and running and then once the balance sheet looked a bit stronger move to a rail line. Of course the downside to this is that steel mills like their DSO dry, so rail is the preferred method for freighting DSO. Nothing concrete, but I just got the feeling that maybe the railway was being held back as a bit of a bargaining chip, as obviously the Government would much rather a railway was put through the jungle than a single user slurry pipeline.
So after luring GJ into a false sense of security I slapped him between the eyes with the big nasty one.
"Obviously as a shareholder of SDL I am anticipating a further dilution of my shareholding in order to bring the project to fruition. What level of dilution do you and the board consider acceptable?"
I'm not sure but I thought I saw GJ go weak at the knees:
Now I have to say that GJ handled the question with the aplomb of a John Howard, Wayne Swann or a Bromwyn Bishop.
He started off by dancing to the left, " When considering the dilution the board has the option of selling off rights to Mbalam only (and then he started a little pirroret to the right) or issuing a considerable tranche of shares in The Company ( I assume that he meant Sundance and not Cam Iron, but I could be wrong). He then explained that currently the tennements were in 2 differing countries (Cameroon and Congo) and that there were benefits and draw backs to both. After about five minutes of explaining what we all already know, he then skipped off to the next question, with out actually answering my question and with out looking back.
So Jewels gets the impression that with the deals already on the desk that I'm going to be dropping my pants and taking a great big black one right up where the sun dont shine.
Now I was also interested to know if Sundance was privy to talks with the IMF, as they only visited Cameroon about 4 weeks ago.
GJ's reply was interesting. Now remember this with Mbalam only, and with current resources, SDL will be providing about 8% of Cameroons GDP.....
When this project is in full flight we will be producing up to 20% of Cameroons GDP" Whilst Sundance was not involved with talks with the IMF on this occasion, the IMF, World bank, Bank of Africa and the like are big supporters of Sundance. They are backing us by making sure that the business process in Cameroon is fair and transperant. Now I'm paraphrasing this bit, but basically if the Government of Cameroon tries anything Dodgy, then this will severely impede the current process that they have embarked upon with the IMF (ie making their government more trasperant and less corrupt) leading to the IMF and world bank turning off the tap of monetary supply.
Now I wonder if GJ knows something about Cameroons GDP going forward from 2012? Either the countries oil and gas reserves are all but dried up, or there is a hell of a lot more ore in the ground than the shareholders know about ( and yes I am aware that Mbalam is open at depth and strike.) I also wonder if GJ was taking into account other mines coming on line between now and 2012 (eg Rio. Auora etc etc.)? An additional 12% of a countries GDP that has to be a hell of a lot of iron ore doesn't it????
After the meeting closed officially I cornered GJ and asked:
"Obviously you've had several months to consider the Non-binding proposals that you announced to the market in the last quarter of calender 2008, you must have a preferred outcome, how confident are you that you will be able to achieve your preffered outcome?" (I always try to ask questions of boardmembers that they can answer them without having to run foul of the ASX listing rules <more chance of getting an answer>)
I was very pleased to hear GJ say that negotitions were proceeding as planned and that he was very confident of achieving the desired outcome. Having said that though, I'm sure if you had of asked Woosha if the Eagles had a chance against Freo on Saturday, I'm sure Woosh would have answered that he also was very confident of achieving the desired outcome.
Something else that seems to have slipped through the cracks is that DL wasnt at the meeting. When giving appolagies GJ said that DL was in China on SDL business. Nobody else seems to deem this comment worthy of discussion. Maybe they are looking at the chinese rights to the "Wok in a Box" franchise or something.
Anyway just thought I'd keep you posted with some informed commentary, as there seems to be a lot of posting by people who have little or no relationship to the company or Cameroon (and hence little or no idea).
And believe it or not English is my first language, I just couldn't be fagged proof reading this dribble and don't have the facility to spell check when writing posts.
Ciao Jewels

 

[The Muffin Man]

Thanks for the run down Jewels. It's nice to get information from someone that wes present.

It's also nice to see the board is very confident of achieving their preferred outcome. It gives you the sense that negotiations are going well, or at least that SDL isn't being done over by a larger company / industry group. That the IMF and other groups are actively involved in the area is nice to know. The possible 20% of GDP is a really interesting one, that is a phenominal amount and would surely require an increase in both the iron ore and mine size. I'm thinking this figure would have to be an absolute best case scenario.

As for dilution, I think we all know in some form it's coming, it's the only way the project will get off the ground. I'm expecting a dilution of SDL rather than CamIron, simply because the tenements in the Congo are held by an entity other than CamIron, but is still controlled by SDL. Whoever is contemplating joining the project would want access/ownership to the Congo tenements as well, as it has significant DSO resources and possibly itabirite iron ore beneath that. (similiar to the Mbalam formation)

 

[jman2007]

I was at the recent SDL Meeting and thought I'd give you guys a bit of a run down.

And believe it or not English is my first language, I just couldn't be fagged proof reading this dribble and don't have the facility to spell check when writing posts. Ciao Jewels

Thanks for taking the time to fill us in Jewels

Good to know that there are still some shareholders who aren't afraid to punch above their weight

 

[bumclouds]

What do you think about the current price as a possible entry point?

// AJ

 

[CarbonSteel]

I was at the recent SDL Meeting and thought I'd give you guys a bit of a run down.

Thanks Jewels for taking the time to relate the contents of this meeting to us and your questions and answers. My general feeling that this company is "coming of age", credibility-wise, is much enhanced by your commentary.

 

[Miner]

I was at the recent SDL Meeting and thought I'd give you guys a bit of a run down.
xxxxxx.
Ciao Jewels

Mate

Thanks for your braveness to front a bunch of pseudo crook or less professional board members and then sharing the discussion in ASF.
My commendation to you as a small share holder (bought at 40 cents with a hope to sell them on a profit or to win Lotto whatever comes first).
You just showed your name Jewel is really Jewel in the Crown.

Pls keep the good work up

 

[The Muffin Man]

Mate

Thanks for your braveness to front a bunch of pseudo crook or less professional board members and then sharing the discussion in ASF.
My commendation to you as a small share holder (bought at 40 cents with a hope to sell them on a profit or to win Lotto whatever comes first).
You just showed your name Jewel is really Jewel in the Crown.

Pls keep the good work up

Can you elaborate Miner? I'm not quite following what you are saying here.

This sentance is to simply to get me over the minimum character count.

 

[Sean K]

What do you think about the current price as a possible entry point?

// AJ

Is it undervalued, or overvalued?
Is it on a downtrend, sidetrend, or uptrend?
What time of the star cycle is it?
What's the future trend of the economy?
What's the outlook for IO?
What's management like?
How's the country risk?
Is entry price important?
etc etc...