Ann: Quarterly Activities Report - March 2022, page-64

I've got a good few but also holding off any top up. Time to lighten was couple of weeks ago once it became obvious between China and Fed world was going into a recession. One has to assume min sand pricing falls post Jun qtr and Kwale stops throwing out the over-sized cashflow it has been on new contract pricing Sep qtr onwards. Regardless of 'value' history shows commodity stocks don;t do well into recessions. Not that I did, or many could have trimmed sails into 30's on low real volume (removing the prop bids of market makers trading with themselves), but quickly the price re-rates down to levels more not so obvious for a trade out and back in later.

Another red flag was Regal advertising to the market they were back into selling game mode with that circular share loan agreement into controlled investment bank account release (for sure imo). Smacks of classic Regal, hold the stock, lend to investment bank and trade with yourself and/or sell their own stock but without triggering a CG disposal or change in sub notice beyond the lending contract. Shake the tree into market corrections, unwind on the way back up and make good trading profits while never even reporting a short to the ASX. Nobody better at it, they specialise in smaller stocks the other big boys dont play with. Look at their net selling from 19th May Change in Sub notice and cross-check with the ASX reported shorts... nada, selling is not naked and not to genuine third parties one assume so no no shorts reported to ASX...

My point is, I agree with you, no point averaging down too early when Regal are happy to walk a genuinely illiquid stock down to where they want it for whatever reason they want it down there. At some point it will be 'oversold' enough for me to double down but not yet, and certainly not until I see clarity on the Madagascar deal done. BSE was primarily an investment in BSE re-rating on a good deal and educating the markets exactly what Toliara is worth LT. Pity the deal dragged for 6 months longer than expected, if deal was done early in the year as hoped stock would have bee re-rated in bull market and this would be a different conversation... ce la vie.

@LongTony... agree the plan was not to shout monazite value add form the roof tops or at all in fact, less it offend Madagascar during negotiations. Walking quietly however does not preclude doing the obvious and required pathway studies. There is a lot of complication and compliance issues dealing with high U-Th monazite unfortunately... one reason BSE isn;t priced way, way higher already. In fact, running 'pathway studies' in the background since last year when it was obvious how important monazite could be (eg REO pricing to the moon, ILU and their Eneabba Re plant in case anyone was living under a rock) was the smart tactical move imo. No NPV or value work, just a reminder to Madagascar of the difficult risky slog handling and transporting U-Th monazite is.

All that pathway planning is required before plant design with mon circuit insertion, off-take contracts and all the 'value add' negotiations can begin in earnest. My point is that is a l ot of work right there... ILU sell a ~20% mon con to get under transport radiation levels, RIO ship lined sea containers in otherwise nearly empty ships to get around it, not just the pathway how but the permitting etc to do so. Walk quietly and carry a big stick as the saying goes... the big stick being having all their monazite ducks in a row early, not finding out in 12 months time everything is design ready for the green light go except monazite which is still being worked out because they started looking into the technicalities too late. Hope I'm just paranoid and wrong, but too often professionals surprise me with how unprofessional they are.

My call... Toliara deal this month, on good terms, no more divies. Just hope they don;t come back to market cap in hand because they went too hard on divies too early.