Instead of me writing out a whole new post, I thought I would just address your points by copying yours and making comment. It can be taken out of context this way, so don't see it as that. Just making simple comments (or just my views - but just doing it because I'm pretty busy at the minute).
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Interesting comments re MLM and MZI. I think exploring small scale development makes sense if we definitely can't get a full scale development going in a reasonable period of time. (And i think we need to consider that as being from a few months into BBs time at the helm which was the beginning of a rescue mission really).
What's a suitable time frame? I would say some reasonable time into an upturn in the market place as that's what it seems it will take to get a full scale partner for Coburn - better prices and more favourable currency. If no body is interested say 6 months in to a genuine recovery then your plan could be a goer. Personally I'd also look at any ways of monetising it if we can't get it up in recovery conditions including flogging it off.
I think BB should have pushed that from the minute he walked in, but like I've said before, it more than likely couldn't be done because of the low grade of Coburn. The mine plan if I remember correctly for Coburn was for a 20mt thru-put and that's a lot of sand. MLM's project is small, but the grade is strong at 10%+, so that's probably the reason why they could get it up. Also, it will be pretty mobile so they would be able to move it like what was proposed for MZI's Tiwi Island plant. But it goes to my whole point about Coburn that it's a deposit that shouldn't have had so much coin spent on it.
Not sure what you mean re Mike Folwell. Are you referring to working with Steelx in a different commodity sector? I don't think that matters overly much given he has got very relevant background. David Robb took over Iluka from Folwell coming from energy with Wesfarmers and he's done a solid job. Correct me if I'm wrong but my understanding is that whilst Folwell was ultimately pushed out of Iluka it was during his time that the core assets they're exploiting now were discovered - ambrosia and jacintha. My reading is that his years at the helm helped lay the foundation for where they are now.
Even if I'm overinterpreting Folwell's achievements he's still got very valuable sands experience that should be beneficial for us when that's put with his team. The collective experience is important for the reason that you point out that there is no shortage of sand. I think we're seeing that it's not always obvious from an asset why some things are getting funded and others aren't.
Yeah, probably a bit hard on him. But the industry has evolved dramatically in the past 8 years since he was at Iluka. Pricing mechanisms have changed and China has shoved it's way to the top of the end user list and to deal with China you need people that have either worked there or are currently working there. Base Resources ripped Stephen Hay from Iluka, he was their Chinese GM.
You've cited a good example there in MLM, how does an inconsequential project like that get solid support? To me the answer is people - skills, connections and networks, deal making abilities etc.
Yeah and a bit of luck. The other interesting point is that MLM are only making a concentrate. This will then be shipped up to the chinese to be dry milled and they get to make money on top of the sale. I also think that they are eyeing off their bauxite deposits. A metal that is having a real turn at the moment.
BB is putting these things in place - things which you've correctly highlighted as weaknesses in GUN in the past. I might be naive but I think we're starting to see some positive fruit from BBs labours, stuff we haven't known was happening in the background. He's already done good work for us with the Torrens/mt gunson copper relationship and this builds on that step. These people and what they're bringing, a whole new face and a new story is exactly why new shareholders are putting good money into the move.
I really don't follow the copper thing much, but it looks positive, but I don't understand why they don't push that and their nickel harder and less off the sand. Where has the sand got Gunson holders?
I think it's fair to urge some caution about the Tanzanian assets. They are definitely very early stage and there's plenty of work ahead. I hear what you are saying re dunal vs strandline but do you think the early exploration doesn't look interesting?
No, I don't. There are enough sand deposits already known around the world that are JORC'd. That map provided in the presentation shows a lot of very large deposits south of Tanzania, some are not even developed and they have huge mine life's, why go find another if they haven't been developed? You've also got MDL's deposit coming online in the next couple of months as well. Like I said, WTR have got a massive deposit in Madagascar, but they are 3c and struggling.
There looks to be a lot of blue sky to open up and the market has proven it will listen to new sands discoveries as Sheffield (SFX) have demonstrated. (Backed by Hartleys who are conducting the private placement for us)
I think the market at present is off new sand discoveries. (Here's a list of JORC'd deposits just in W.A. - GUN, DRX, IMA, SFX, MZI). That's a heap of sand. As for Sheffield's Thunderbird, the more I look at it, the more I dislike it. That latest presentation shows me why Rio gave it up with TiO2 levels that battle to get to 50%. (it's just low grade crap, that would need to be leached and smelted). They have given figures of $180t for it, just laughable.
For one, I'm keen to learn more about the issues that might be challenges ahead for the Strandline assets as much as the opportunities they might look like presenting.
If they bought Strandline and started searching for HM, in reality it's going to cost $15m plus and possibly 10 years to get development - at best. Think about how many cap raisings they will do from now until then. Look it could spike up within that time, but it's a real gamble particulary with so many other juniors fighting in the same space.
I have written more views about the sand industry and where I think it could go on the MZI thread.
P (I don't own any stock mentioned within this post).
GUN Price at posting:
2.1¢ Sentiment: None Disclosure: Not Held
