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SDL - Sundance Resources

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adobee said:
SDL now advertising on the radio ??? Sure the advertisement said production 2011...
DO they need more market exposure to get this moving by mums and dads .. surely not ..
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where was this advertised ? directly by company? it is not a good sign if they are plugging.

Reminds me of FML trying to get market interested by making daily releases saying things like "we dug a hole, then we drilled a bit, oh and today bill got his teeth fixed so we are closer to higher production...." (ok obviously not, but the point I make is that it doesn't seem to help...)
 

Absolutely correct guys, this is a point everyone needs to pick up on. SDL is still using under US$70/t in all of it's financial modelling, it's just expressed it differently in the DFS release.

USc/dmtu is a different measurement to US$/t.

US105c/dmtu is equivalent to the US$68-69/t that has been used by the company sice day dot.

This means that there is still huge potential upside if the IO price is anything above that US$68-69 when we start producing.
 
The Muffin Man said:
This means that there is still huge potential upside if the IO price is anything above that US$68-69 when we start producing.
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There is also potential downside. There are some massive projects on the go to increase the supply of iron ore. By the time SDl gets something to sell the iron ore price could be nothing like todays prices. I'm holding for now, tax reasons make a difference, but I doubt that I will still hold when they are selling iron ore.
 

The CRABS (short sellers and bots) are in control at the moment.

Yes there are always downsides to this project, but it is moving along and it is one of the all time biggies. With the weather up here in W.A lately this area could well suffer the same fate as N.Queensland coal industry, and I was living in QLD when that happened, so before anyone says it cant happen think again. The project area Govt's are all on board with this and they will push this ahead and we know China is going to keep on charging on despite the fluctuations in the interest rates etc there, the overall direction for them is up.

The price of iron ore could well be higher by the time this comes on line who knows you cant just extrapolate data and say it is going to be lower.

But your point is taken and it is a good one it keeps us all in reality thankyou for that.
 

But nioka, SDL isn't using today's prices for it's financial modelling. The only way there could be downside to what has been presented so far is if the price of IO is below the US$65 - US$70 used in the financial modelling. All of the financial modelling and data is being done on that US$65 - US$70. What are the chances of that happening? Low I would think, considering India is just about to enter it's economic expansion phase and is starting to apply export taxes on IO, Brazil is looking at applying export taxes on IO so it develops it's own domestic steel industry, and Chinese IO production prices just keep rising and rising as their ore becomes of much lower grade and harder to extract.

Downside if IO is below US$65-US$70

Upside if IO is above US$65-US$70
 

If there is one thing that I have learnt over the years it is this;"High prices lead to eventual overproduction and low prices" Often very low and uneconomic prices. That will be SDL's second hurdle. The first hurdle that it hasn't yet overcome is funding. It will get funded but as yet the conditions and the cost of that funding are yet to be announced. When I know the funding details I wll decide whether to stay or go.
 

You're a realist, I like it.
If there is one thing I have learnt over the years, it's that the high prices lead to me making money on others' hope and enthusiasm about those high prices!

I am in and am going to bail the ride when the crest first breaks, which will hopefully be a while yet. Don't forget that there is added resilience in this management team due to it's heritage, and there is some padding in their figures too.

You never know what lies around the corner. Perhaps SDL needs to code some more DSO or maybe they need another company to share the rail line...they may still be trying to convince China that investment in this ore is warranted... This could get very stale very quickly if they don't find someone soon in these solid conditions. Capital outlay vs. ore delivery date is a decent duration, might be better options elsewhere currently...
 

I agree that much more supply is coming on line (that's why I'm expecting prices to come down to some degree), but if SDL can't be profitable with it's OPEX costs then no IO miner can be. As the price drops it will be the high-mid cost producers that go first, meaning once they go supply will naturally contract. As the IO price drops it will also become more uneconomical for Chinese mines to produce due to their high production costs. SDL is sitting pretty as far as OPEX goes. I don't think that the prices used in the modelling are in any way outlandish, I'd say they are ultra conservative, that's why I think there is more chance of there being upside to the financial modelling when considering the IO price used than there being downside.
 

We are also in unprecedented territory. There is no point in history where 40% of the worlds population needs to become affluent within 20 years. Now we really do have this reality. As I said it is unprecedented and it is anyones guess what will happen in this scenario. Far from prices decreasing with more supply, it is also possible that prices could triple isn't it? Who really knows? The world has never been here before.

Can anyone give me a website that does not charge for the current spot IO price?

Greatly appreciated if you can.

Regards to all.
 
I note with interest that in todays investor presentation the conclusion of finance/offtake partner agreements has now been moved to straddle 2nd & 3rd Q's. I guess that means end of the end of Q3 unless it is modified yet again.
 
CarbonSteel said:
I note with interest that in todays investor presentation the conclusion of finance/offtake partner agreements has now been moved to straddle 2nd & 3rd Q's. I guess that means end of the end of Q3 unless it is modified yet again.
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Nah, it was there before this carbon. Guilio stated in DFS release that finance/offtake would be done in 2nd qtr - here's hoping anyway
 
What are Owners Costs?

Quite a large figure has been allocated to these costs and I am just trying to understand what they might relate to?

Sorry for what may be a basic question.

Thanks bj
 
jonojpsg said:
Nah, it was there before this carbon. Guilio stated in DFS release that finance/offtake would be done in 2nd qtr - here's hoping anyway
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I beg to differ sir.

See the International Roadshow Presentation dated 28/01/11, page 16. You can find it here - http://www.asx.com.au/asxpdf/20110128/pdf/41wfp32fwd7lx4.pdf - see how the diamond is in the centre of Q2?

Now look at the latest Investor Presentation date 14/04/11, page 17 - 2.5 months later. You can find it here - http://www.asx.com.au/asxpdf/20110414/pdf/41y1hbl17p8846.pdf

See how the diamond now straddles Q2 & Q3?

My question is this. Why would they change their schedule in a graphic sense if they still intend to complete Finance/Off-take according to the 2.5 month old International Roadshow Presentation schedule?

I submit that instead of making what would be seen as a negative announcement, they have altered this schedule almost by slight of hand.

Given delays in the past, it is not surprising but it is fact.
 
It is of interest the delays over the years to these most important announcments ( Government ratification / Financing ). I would suggest that the board is awaiting on the Exstrata Glencore merge. Exstrata has made its point that it wants its own IO division seperate to its coal. It currently has $22b budgeted for expansion and aquisitions and the Glencore Merge will raise another $10b cash and also give it marvellous access to the markets. West Africa is the only place left where you can become a serious player ( 100m tonne per year ). Exstrata recently purchased majority share of the Zanuka IO depoist in southern Congo - ( approx 500 km away from SDL Congo ). Although a large deposit it only averages 33%. It is having difficulties planning a railway to Port Du Prince. My gut feeling or "hope" is that in reality the deal is done, Exstrata will want SDL and eventually run the railine North to SDL. That is why the Chinese have bought 20% stake of SDL quite suddenly to have some say as it also wants to become a major player with its Belinga mine ( 150km away ) but Gabon is a basket case. The Chinese would much prefer to run a rail link up to Mbalam than set up a seperate track. The hope is for a bidding war between the Chinese and the Swisse for SDL as it has what it takes for the region to open up ( rail / power / port/ stronger soveriegn risk The board and the government is waiting for a catalyst and just maybe this merge is it.

ZODIAC
 
A lot of speculation over what the company is doing and Im thinking they are not telling the real story about what is going on. Yet more delays to negotiations and this will probably be delayed again as is the habbit of the board to delay and then throw up some old interview or appraisal dressed up to look new in an atempt tol impress somebody.

Has anyone heard that BHP is planning to triple its Iron Ore output fron the Pilbarra, I read an article about it. It wont be good for IO prices if they do, has anyone got anymore on this?

Oh by the way has any of the contracts actually been signed for the rail and port. I know there are MOU's but I dont think there is any signed sealed and delivered contracts as yet it will have to happen soon after the financing whenever that happens. Anybody know for sure?

bye now
 
no contracts to my knowledge.
rest assured that BHP won't let the price go down significantly, its bad business to supply too much product.
Captain obvious just told me that SDL is going to be shipping ore from Africa, which carries more risk, but remains attractive due to the unexplored region (promising for further resources) and the fact that it is NOT BHP or RIO or VALE, that will keep some interested.
Not impressed with the performance lately. There must be major issue with getting someone signed up, I don't know what the hang up is, but it is worrying with this low level of info from SDL.
time will tell.
 
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