Great move on LJ. POS now has 5 working mines- windarra, silver swan, Bswan, Silver swan and LJohnston with 2 large resources Laverton JV with PAN and Cerberus, plus 2 processing plants that can process at 2.2MTPA & 1.5MTPA = 3.7MTPA thats about 30,000 Ni tonnes in concentrate thats $561M income per annum at full capacity.
People are forgetting that LJ is medium grade 1.49%-4.18% at Emily Ann and Emily Ann and Silver Swan are the jewels in the crown with that high grade going through first the profit margin will be massively higher and can be used at lower millage tonnes to make larger income. Also people are forgetting that Norilsk is the current offtake received in brazil to MBN mirabella and kept that NI operation alive. I reckon Norilsk will not agree to such low sale prices unless they had agreed to take the offtake as well, Norilsk invested over $1B into these plants and mines from lionore and they are in excellent condition, thank you from russia with love. And POS has now taken over this Norilsk project almost entirely instead BHPs Nickel West looks like going to glencore for $300M instead of $800M which will make AF and the ANL boys mad as hell. Other NI producers in WA are all dependent on BHP - PAN MCR WSA supply BHP with ore.
Now POS has overnight become the third largest producer and resource holder and THE LARGEST plant mill operator with 3.7M TPA milling capacity without any further expansions which it can easily expand from profits in coming years. The market is still not gettin this- POS is the challenger to BHPs Nickel West and is the new Norilsk and the New Nickel. Its base will be kalgoorlie and if it can get the smelter off BHP piecemeal for $100M it will totally dominate the whole WA NI market. Even without the smelter for $4M POS has developed into a NI operation larger in scope and resources than MBN MCR and even Norilsk in WA. Still smaller than WSA and SIR. WSA depends solely on BHP ore milling and has no mill of their own and SIR is not even built yet with $500M-$1B of debt to 2017. Their MCs are $1B
So whats POS worth, it has to be well above the TP of Petra capital of 44c NPV, with LJ and its new mill, 5 mines, 2 massive resources, 2 mills at 3.5MTPA, no real debt right now (CN and AF loan is not real debt). I estimate Petra Capital will come out with a new NPV of 60c SP. POS has the capacity to mill ore for kambalda miners like PAN and MCR at LJ and compete with Nickel West, this will throw BHPs sale process into a spanner in the works. AF will compete against the swiss who took ANL off him! What a grudge match, AF must be falling off his chair in excitement, The FMG old boys and Petra must be lining up to pitch in funds and debt, AF will soon be working those phones with credit suisse his bankers and Bud Scruggs and Jeffries Bank as this is a compelling investment case for any lender now - high production, massive resources, a second largest producer/ miller in WA with low or no real debt, if it were me, heres $300M please let me in.
POS is the New NIckel, AF has silently built the third largest NI operation in WA, Petra and pattersons NPV upgrades being worked on now. Dr Tesla says he has been watching and buying in. Well done boys on this. Congrats to all, SP at 50c soon.
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