Good afternoon
and here we go again….it seems that some tarde agreement might not be that far away. Politics, since Trump entered the scene, are absolutely unpredictable these days. The NATO meeting seems to be a farce ( in London and not in Paris, as I said yesterday …). In any case- trade hopes are solicting equities & metals higher, bonds lower today, and gold remains largely unchanged. Palladium is continuing it´s bull-run with new highs.
The Chinese government targets 25% of all vehicles sold in 2025 to be electric….sounds difficault to me, and Macquarie analysts predict 13%. But one thing is without question: The political drive for EV´s remains very strong indeed.
Rare Earth producers in China shot higher today, as prices for their products saw substantial price increases.
RIO will spend 1.5 bill US$ to keep Bingham Copper producing for an additional 6 years. They are obviously putting their moeny, where their mouth is with regards to the long term outlook for copper. RIO also halts mining operations, and also work on the 500 Mill US$ capital project, at Richards Bay, the worlds largest producer of TiO2. There has been massive trouble in areas surrounding the project for years, but things got even worse a few days ago, when a worker was shot. Should be very good news for Sheffield ( sorry, but the world is cynical! )- but their share price was down, regardless.
Interesting update from Evolution, showing the very strong seasonality of the gold index in Australia: November has been the weakest month over the years by a long shot ( on average down 6.3% ), while Dec/Jan/Feb are the strongest month ( on average up by 7 / 7.8/ and 6.2%. That is quite remarkable - let´s hope, that it happens this year as well!
Hot Chili - I have not written about them for years, and below the line, the stock has not done all that much…it´s only recovering now to levels last reached in 2016…but the company has made good progress over the years - working on the same project, still, in Chile, Today, tehy announced results from a fantastic, deep hole, of 972m with 0,5% copper and 0,2g gold - including 412m at 0,7% copper and 0,3g gold. Their main project so far has been Productora, about 18km disatnce to the more recent discovery, which contains 1.5 millt of copper and 1 mill oz of gold, but probably needs better copper prices to get the go-ahead. The new find could have betetr grades, and also very large tonnage - so definitely worth keeping an eye on this 60 mill$ company. At the end of this Quarter, they should have 4 mill$ left in cash - so next placement will be coming some time in the 1st Quarter 2020. It could be an interesting one.
West African - released a new presentation with new fotos - stating, that construction is 80% complete, and electrification of the plant has started. Not sure, what they want to do in the next 6 month! The proejct should start pouring gold earlier than in late June, as officially stated. Could it be, that one of the rules of investing in mining stocks will be broken: Never have a geologist running a development??? But to be honest - it should not make a difference to the company´s valuation, whether it starts producing gold in May or in June…But we all know, what markets are like - and especially following some negative experiences recently, where mining companies had severe problems to bring their new developments into proper production. So in light of this, I think it´s smart for the company to err on the conservative side!
Panoramic - the operational review has found no material differences to the final feasibility study for the all-important Savannah North orebody. 5% less ore at 2% less grades is expected, but costs are estimated to be unchanged, using the same parameters as in the feasibility study at the time. The company now expects AISC of 3,75 US$/lb payable nickel - a fraction higher, using today´s parameters. The new MD sees upside from several things, especially using contract work for more efficiency. tenders are out, and will be returned before the end of the year - we could see better productivity . They also stress, that there is very matterial upside frome xploration - from recent , positive drilling results, but also, as large areas have not been drileld ( much cheaper to do it from underground ). The board stresses: take no action in regard to the takeover…pleanty of time left, and I add: Who knows, who else comes out of the bushwork and makes a competing offer!
have a nice evening
WS