Ann: Application for quotation of securities - NRZ, page-6

Ah, the mysterious Pre-FID funding.

Cheyne rightly says, "Where is the pre-FID funding ?"

I say, "What the bloody hell is this pre-FID funding?"

It's time for another reality check.

Here is my current view of the situation. It is my pessimistic opinion only, can't substantiate it, please comment on it if you like, but don't get your knickers in a twist.

The pre-FID funding (up to $100 million), promised in September 2022, but not delivered.

I believe that it is not part of the $3 billion required for the project (my current assessment of the cost of the project). It is just enough to keep the company alive until it earns income.

It will be a share placement, and if it is dropped now, the share price will be about 10 cents. i.e. 1,000,000,000 shares. Ouch.

NRZ currently has about 1,100,000,000 shares on issue. A total of 2,100,000,000.

On top of this NRZ has to provide equity, in the form of a placement, in the order of 15% of $3,000,000,000. i.e. $450,000,000. This will be at about 10 cents per share. i.e. 4,500,000,000 shares.

There will now be 6.6 billion shares on issue.

Now back to the Pitt Street Research Report of 15 September 2022.

Two scenarios,



Bull Case. Capital raised at 20 cents per share, and increased urea prices. Pigs might fly.
Base Case. Capital raised at 14 cents per share. Very long odds.

If we base fair value on an Enterprise Value of around $1.4 billion and 6.6 billion shares, we get a share fairly valued at about 21 cents. And who is prepared to pay fair value for a project, particularly at this stage of the proceedings. And there would be no profit

The metrics used in the calculations have to be maintained to hold value or improved if you want a better result.

It will be a long time before you see 20 cents per share, IMO, guys, but be patient, I think that if there is nothing untoward it will get there eventually.

What do I see?

"Analysis paralysis on the part of management" and "A project so complex that it is not completely under control"

That's it. folks, my opinion only, but it's your investment.

How close do you think this scenario might be? Give us your assessment of the where it's at. J L.