"The discrepancy between this report and company disclosures is quite distressing for shareholders, as has been commented on by many"... hey VinceS2, welcome aboard the retail ship STA Mushroom. Now all the dead bodies have finally floated to the surface (as they always do) we can conduct a more accurate autopsy of events. No doubt DMU and other equipment failures compounded ongoing WCP ramp-up issues, but I can't remember ever seeing lack of operators mentioned, and "enhancing tails deposition planning" was first mentioned 10th July for 7th shipment update...
According to Shaws, the major issue since early April has been tailings disposal issues, first alluded to
27th Apr in Mar Qrtly report.
Investor Presso
17th May
1st June for 6th Shipment update
10th July for 7th Shipment Update
20th July Noosa Presso
I understand that blaming "equipment availability" is a neat and simple grab-bag for why ramp-up is slower than expected as per every release from the Mar Qtr onwards (Mar Qtr being all running to plan, Shaws and Morgans both wrote glowing updates, market happy with share price). Clearly admitting that mine planning and lack of operators was an issue is embarrassing, that simple higher water table in finished pits issue was not acted upon quickly is embarrassing (solution was add more sump pumps... really
) and that once tailings build up without anywhere to go causes double handing bottlenecks requiring shut downs is embarrassing.
The seemingly innocuous mention of "enhancing mine planning" all year was meant to say something like "lack of staff including senior mine engineers and operators means mining is chasing it's tail around poor operation and implementation" perhaps would have been a more honest explanation rather than make out it was all DMU's and equipment. (I remember
@Peppie posting that advert for Cobern Senior Mine engineer a month, which now looks more ominous than it did at the time).
I guess we will eventually get the truth of it if STA ever announces the quantum of warranty claims against DMU supplier... frankly, if nothing is ever said that would strongly point to the DMU issues not being the major cause of ramp-up issues after all. If a large warranty claim is paid out that would be proof the DMUs were a major issue. I have investigated the DMUs extensively by industry comp and see no reason why the 3 DMUs are not fit for purpose and 23.5Mtpa once mechanical failures are sorted. Likewise, power outages etc, many small issues need ironing during any mine ramp up stage.
In summary, Shaws site visit update paints a picture much more of a poorly run and managed mine, chasing it's tails (pun intended) with as much reactive problem-solving production downtime as equipment failure. Good mine management obviously monitors and anticipates key risks while keeping the mine plan flexible to required adjustments as issues start occurring... No wonder a new CEO was brought in to get onto of mine planning and operation issues as opposed to simply waiting for the equipment failures to get fixed and nameplate to just naturally follow on.
Yes I'm sour, because I didn't buy materially until the Noosa Presso where it seemed Luke was giving the thumbs up to rectification of issues being blamed for ramp-up issues, and very positive hints about the mine hitting 75% soon and 100% nameplate before end of year. Followed up with Shaws 'oversold' Buy report next day, and following day touching 20.5c LT support where I bought the next big swag I really can't fault my reading of the situation or timing of my buys from a technical charting and management guidance perspective. No matter how well you analyse and tick boxes when trading/investing, it is and will always be a risky game of driving by looking in the rear-view mirror... and the odd head on smash into an unseen CR dead ahead
GLTAH
(20min delay)