SKM - Skylark Minerals

[barney]

Safe play is to wait till that's out I guess as a negative result will probably send this back to 2c.

DNH and just jumping in for a quick look.

No idea of the fundamentals with this battler, but the 036 level definitely looks a place to watch for any associated action??

 

[Sean K]

DNH and just jumping in for a quick look.

No idea of the fundamentals with this battler, but the 036 level definitely looks a place to watch for any associated action??

View attachment 132735

Well spotted Barney. Could slide back to there before an announcement comes out even, if one does.

 

[Sean K]

I've decided to step back in here with some support at 4c and a decision on investment by EXIM imminent. Taking a significant risk with the funding decision but only taken another small bite. Will continue to watch very closely.

Supporting this is the US deciding to put Ni and Zn on the critical minerals list, which will give EXIM an easier decision to lend money for the capex to get this off the ground, which is the major hurdle. It's an excellent deposit in an awkward location but capex around $650m seems to be the major problem to me.

If they don't get the loan, then they're going to have to go to market immediately for some operating cash with only $1.6m in the bank at end of Sep.

United States adds nickel, zinc to critical minerals list: Andy Home​

(The opinions expressed here are those of the author, a columnist for Reuters) By Andy Home LONDON, Nov 15 (Reuters) - Nickel and zinc are now deemed critical minerals by the United States.

The U.S. Geological Survey (USGS) is proposing both metals be included in the redrafted critical minerals list. The list has grown from 35 to 50 since the last iteration in 2018, but that largely reflects the splitting out of rare earth elements and precious group metals into separate entities.

Four minerals - helium, potash, rhenium, and strontium - have been dropped. The United States is the world's leading producer and net exporter of helium, while import dependency for the other three is mitigated by "low disruption potential".

Uranium was also dropped after being reclassified as a "mineral fuel". Nickel and zinc are the only two new additions, and each reflects an evolution of the methodology used to determine whether a mineral is critical to the well-being of the U.S. economy.

 

[Sean K]

This wasn't what was expected. They've just qualified for special consideration and it's not the loan decision. Disappointing. We seem to have been misled by what stage of the process they were in, unless I misread previous announcements and statements.

 

[barney]

This wasn't what was expected.

Market seems to be happy so far (DNH)

 

[Sean K]

Market seems to be happy so far (DNH)

Ended up 15% so Mr Market liked it a little. I'm very good at picking market sentiment with these things...

The positive out of it is that it's progressing, and it's not a no deal. To be in the frame for the EXIM is critical, so if this is the proper path, then great. Just wish I had have known what the hoops were to jump through. Hopefully there's no more announcements about the application jumping through another unknown hoop and they just come out with the final decision. I am feeling a little bit more confident on my roll of the dice at the moment.

 

[Sean K]

IBG pause in trading for an announcement. Can only be the EXIM, you'd have to think. All digits crossed.

edit: now in halt - ref finance. The stock could halve or double depending on a no or a yes. Hopefully it's clear cut and not another hoop that's been jumped through.

 

[Sean K]

I'm having a good day today.

 

[Sean K]

Jumped the gun on today being a good day, although indicative open is currently 5.9c from prev close 4.7c, so still ok.

This still isn't a binding agreement, and just another hoop, but it's hard to see it not happening from here. Plus, they're doing a CR at the same time, so anything could happen.

Going to be interesting to see what this has on it's MC. Currently still just $50m with all that Zn and Pd and about to get a line of credit for up to US$650m.

 

[Sean K]

Uh oh, it’s in The Fin. I didn’t buy enough.

 

[Sean K]

In suspension, for a halt, for a CR now. Hopefully holders get some at whatever discount it is. They should have done the raising after it re-opened and the possible re-rating upwards due to the EXIM. Seems they might be raising at a pretty low price for what it could be. Odd.

NPV of the project is $US363 but their MC is $50m...

 

[Sean K]

Gapped up a little bit.

Hopefully that doesn't get filled.

 

[Sean K]

Well, that is one ugly MF of a candle if you bought in early today, but if you had some prior to the ann, and you sold a few, it'd be a very sweet Friday afternoon. ?

If they get this off the ground it's still undervalued at under $100m MC.

And that is surely going to happen now that EXIM are 90% on board.

 

[Sean K]

Very surprised this has reversed back down to pre-announcement region. The very likely decision on the EXIM loan should have held this up and re-rated it. Perhaps there's something else in the wind about the decision that's spooking punters.

 

[Sean K]

I wanted to pick this in the yearly 2022 comp but the SP is too low.

MC under $70m and they're about to get $650m in financing. How does that add up?

Perhaps there's still a load of risk applied to it.

At this stage, happy to have accumulated a few around the 4c mark.

 

[Sean K]

I was expecting (hoping, maybe more like it) that the EXIM would have come through in Jan and put a ? under this, but no. Well, it could happen Monday. So, ? it's Feb. Maybe I'm underestimating the DD period. I anticipate similar price action to when the PPL was delivered, but some follow through and it being re-rated considerably. MC still at a lowly $50m ish with all that Zn just sitting there.

 

[Sean K]

I think I'm going to have to change my monthly comp pick as this EXIM process could go on forever. Last year the company was saying that they'd get an answer by the end of the year but all they got was the PPL. I don't think they've been very up front with the exact process and timeline TBH.

Quarterly:

Further discussions are currently underway between Ironbark and US EXIM Bank on the timing and process for Phase 2 work in 2022. A range of external advisors, in addition to Greengate LLC, are yet to be appointed by EXIM for Phase 2 with the final scope, work program and outcomes not currently anticipated to be agreed until late February. An announcement on this will be made at the appropriate time.

 

[Sean K]

I think I'm going to have to change my monthly comp pick as this EXIM process could go on forever. Last year the company was saying that they'd get an answer by the end of the year but all they got was the PPL. I don't think they've been very up front with the exact process and timeline TBH.

Quarterly:




View attachment 136812

There was supposed to be an agreement by late February and then an announcement. That's Monday boys! Come on, you're killing me in the monthly comp.

 

[frugal.rock]

What a Downer. A.

 

[The Triangle]

Sorry for being a Debbie Downer here. This is another project I can't ever see happening. I only know of one other Aussie tie-up with the import/export bank and that was Newsat... And that didn't exactly turnout very well.

Here are my thoughts on why this is a dud of a project:

• In arguably the most remote part of the world:
  • No 'Just drive to to Kal this morning and pick up that part we need'
  • The inventory they would need to hold to ensure no supply chain risk would be rather high.
  • No local community - so where does the workforce come from? Expats can go to Asia and Africa with the typical expat 'trappings' available there and it's not cold.
  • UG mining costs of $25/tonne USD?? Is that real? For example BGL is forecasting $86/tonne AUD... Not quite apples to apples but again, see above. Operating in the arctic is not going to be cheap.
• 15% IRR....And nearly a billion AUD in capex.
  • Razor thin margin in my opinion for a high risk project. If it was 10 minutes outside of Port Hedland or Kalgoorlie it would be different.
  • Mainly underground mining at around 5.0% zinc? look at all the other zinc mines in the world. I believe they are all much higher grades/margin per tonne. In 5 minutes on google I found the following:
    • Dugald River = 12%
    • Golden Grove = 4% (also have 1g/t gold, 1+ oz/t silver, 1% copper - which I think ends up as nearly 10% ZnEq)
    • Red Dog = 15% + 4% lead (also in arctic but open pit)
    • Rampura = 14%
    • Mcarthur River = 8% (and 4.4% lead and 2oz/t silver)